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on International Trade |
| By: | Francesca SPINELLI; Dorothée ROUZET; ZHANG Hongyong |
| Abstract: | The paper provides evidence on the investment patterns of Japanese multinational enterprises (MNEs) across countries and industries and analyzes the main drivers of Japanese foreign direct investment (FDI) location strategies, using detailed micro-data on Japanese parents and affiliates statistics. The main stylized facts point to the high degree of concentration of the activity of Japanese multinationals and differences in size and productivity depending on parents' and affiliates' main industry groups. The breakdown of affiliate sales by destination markets reveals that Japanese MNEs establish services affiliates primarily to maximize the proximity to local customers, while foreign affiliates in manufacturing sectors tend to engage more with third countries. Yet, some economies emerge as strategic gateways to other destinations in the region. The econometric analysis further analyzes the drivers of Japanese MNEs' expansion abroad in search of new markets, production efficiency, and regional or global platforms. Important factors shaping Japanese FDI decisions include firm characteristics and host market specificities such as market size, proximity, labor costs, technology, and trade policy barriers. The largest and most productive parents are more likely to invest in FDI-export platforms, particularly in host countries with efficient customs procedures and more favorable services trade and investment regulation. Distance and comparative advantage in terms of skills and digital infrastructure play a stronger role in intra-firm trade, while the size of the domestic market and the local regulatory environment are important attractive points for affiliates that sell mostly locally. Overall, the paper stresses the importance of better integration into global production networks and the policy priorities to attract and maximize the benefits of FDI inflows. |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:18057&r=int |
| By: | Ferguson, Shon (Research Institute of Industrial Economics (IFN)); Gars, Johan (GEDB) |
| Abstract: | The purpose of this study is to measure the sensitivity of traded quantities and trade unit values to agricultural production shocks. We develop a general equilibrium model of trade in which production shocks in exporting countries affect both traded quantities and trade unit values. The model includes per-unit trade costs and develops a methodology to quantify their size exploiting the trade unit value data. Using bilateral trade flow data for a large sample of countries and agricultural commodities we find that the intensive margin of trade is relatively inelastic to production shocks, with a 1 percent increase in production leading to a 0.5 percent increase in exports. We also find that per-unit trade costs are large, comprising 15 to 20 percent of import unit values on average. Overall, our results suggest that there is room for improving trade as a mechanism for coping with food production volatility. |
| Keywords: | Food production volatility; Trade costs; Agricultural trade; Gravity model |
| JEL: | F14 F18 Q11 Q17 Q18 |
| Date: | 2018–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1227&r=int |
| By: | Patrick Alexander; Ian Keay |
| Abstract: | In this paper we document Canada’s trade policy response to late-nineteenth- and earlytwentieth-century globalization. We link newly digitized annual product-specific data on the value of Canadian imports and duties paid from 1870–1913 to establishment-specific production and location information drawn from the manuscripts of the 1871 industrial census. Our findings reveal a highly selective move towards protectionism following the adoption of the National Policy in 1879. Changes in the Canadian tariff schedule narrowly targeted final consumption goods that had close substitutes produced by relatively large, politically influential domestic manufacturers. |
| Keywords: | Trade integration; Economic models; International topics |
| JEL: | F F1 F13 F14 F42 N N71 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:18-42&r=int |
| By: | Fertő, Imre |
| Abstract: | One of the most important features in the international trade over the recent decades has been the increased fragmentation of the production process. This has been facilitated, in part, by the development and maturation of global value chains (GVCs).The improved availability of value-added trade data allows us to identify more clearly what fragment in the production chain is internationally competitive in a particular country. The paper examines global agri-food export performance in the light of these changes with special emphasis on the impacts of economic crisis using the concept of normalised revealed comparative advantage (NRCA) in terms of both gross exports and value-added for 61 countries over period 1995 and 2011. Systematically comparing these distributions reveals significant differences for NRCA based on gross exports versus value-added data. |
| Keywords: | Agribusiness, Industrial Organization, International Relations/Trade |
| Date: | 2017–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc17:258653&r=int |
| By: | Arevik Gnutzmann-Mkrtchyan; Christian Henn |
| Abstract: | We demonstrate that durable MFN tariff elimination affects trade patterns through several layers, and magnitudes of effects are sizable. The WTO Information Technology Agreement’s (ITA) unique setting allows us to overcome the challenges associated with identifying effects of non-discriminatory trade policies due to two reasons: (i) ITA constitutes a quasi-natural experiment of several “passive” signatories joining the agreement as an unavoidable part of pursuing a larger policy objective, and (ii) ITA’s partial coverage of the IT sector provides a natural control group for identification based on cross-product variation. Our analysis finds novel nonlinear impacts of tariff liberalization: Complete tariff elimination results in large additional trade gains - over and above tariff reductions - especially for intermediate goods. The commitment to durable tariff elimination, through WTO bindings, adds a further two layers, boosting both imports and exports more than equivalent unilateral reforms. This commitment spurned development of a downstream IT export sector in “passive” signatories. |
| Keywords: | non-discriminatory trade policies, MFN tariff elimination, World Trade Organization, Information Technology Agreement, trade policy certainty, global value chains |
| JEL: | F13 F14 F15 L63 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7172&r=int |
| By: | Sébastien Jean; Philippe Martin; André Sapir |
| Abstract: | This policy contribution was prepared for the French Conseil d’Analyse Économique. The multilateral trading system is seriously threatened by the country which has been its main inspirer, the United States. The US position is focused on bilateral trade imbalances presumably resulting from unbalanced trade policies, but it is flawed. Not only does it make little sense given the existence of global value chains, but it also misses its target - what matters most are aggregate trade surpluses and deficits, which depend above all on the differential between domestic investment and savings, and little on trade policy. This Policy Contribution first analyses the economic consequences of a full-scale trade war. Our estimates show that it would have a permanent effect of a similar magnitude on the GDP per capita of the three major global powers (the European Union, the United States and China) of around 3 percent to 4 percent of GDP, as big as the effect of the Great Recession of 2008-09. The impact would be much more damaging for small countries. By contrast, the EU is partly protected by the size of its internal market. In addition, the short-term effects would be even greater because of the negative supply and demand shock the global economy would be subjected to. For this reason, the EU must engage resolutely in a strategy of defence of trade multilateralism. We recommend combining the adoption of firm and credible retaliatory measures in response to the current attacks with an offer of multilateral or plurilateral negotiations on legitimate issues - macroeconomic imbalances, institutional design of dispute settlement at the World Trade Organisation (WTO), reciprocity of commitments and updating of rules on subsidies, state-owned enterprises and intellectual property rights. However, considering how difficult plurilateral and multilateral negotiations with the US administration are, Europe needs a plan B. In the short term, this requires, for instance, coordinating a club of countries in order to identify and implement strategies to circumvent US blocking of the WTO at the Appellate Body level. In addition, we recommend pursuing an ambitious policy of trade agreements. The expected economic gains are modest. But trade agreements can play an additional role of insurance policies in case of full-scale trade war and can be used as leverage on other non-trade issues. Therefore, these agreements should change and address two main concerns about globalisation - environmental protection with the issue of global warming and problems related to tax evasion and optimisation. We therefore recommend making the signing of trade agreements conditional on the adoption of the OECD’s action plan to combat erosion of the tax base and the implementation of the Paris Climate Agreement. We put forward progressive monitoring and sanction measures to ensure effective implementation. |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polcon:27078&r=int |
| By: | Fiankor, Dela-Dem Doe; Martinez-Zarzoso, Inmaculada; Brümmer, Bernhard |
| Abstract: | The empirical evidence that institutional differences across countries affect bilateral trade is robust. The crucial question remains how countries can enhance trade amid these differences. In this paper, we measure the degree to which governance and institutions differ between countries as “governance distance”. Using a sample of EU/EFTA imports, we examine how the adoption of private food standards and certifications modify the effect of governance distance on exports within a structural gravity framework. Our results show that while increasing governance distance hinders bilateral trade, the interaction of standards and the governance distance is positively associated with exports, hence partially offsetting their direct trade–inhibiting effects. GlobalGAP certified countries see the trade-inhibiting effects of governance distance on their exports reduced by about 50%, ceteris paribus. |
| Keywords: | Agribusiness, Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, International Development, International Relations/Trade |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gagfdp:275059&r=int |
| By: | Young-Han Kim (Sungkyunkwan University) |
| Abstract: | Based on a simple model integrating political contribution provided by exporting firms and verifiability problem of export subsidy for the upstream firms within intricately fragmented production processes, this paper demonstrates that strategic export policies influenced by political contribution can deteriorate social welfare. Moreover, when it is more difficult to identify the government subsidy provided to upstream firms within complicated vertical value chains, there is larger distortion due to higher export subsidies manipulated by the political contribution. Therefore, even if countervailing duties are imposed against the export subsidies, when the probability to detect the export subsidy is lower, the export subsidy dominates the countervailing duty with the distortion due to political contribution aggravated by the lower detection probability. These results implicate that with the deepening fragmentation of global production networks, as it gets more difficult to verify the subsidy provided to upstream production processes, it is more likely that the indirect and hidden strategic government interventions can be made. Therefore, it is imperative to make further efforts to enhance the verifiability of the hidden subsidies to reduce welfare deterioration caused by the politically manipulated strategic trade policies. |
| Keywords: | Strategic trade intervention, Political contribution, Verifiability of hidden subsidy, beggaring thyself, beggaring thy neighbor |
| JEL: | F12 F13 L13 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:7808912&r=int |
| By: | Turkmen Goksel (Ankara University) |
| Abstract: | A standard model of international trade has a setting with constant labor supply. However, this model introduces a consumption-leisure choice into a traditional model of international economics. Therefore, this paper focuses on the response of labor to changes in tariffs. Moreover, I show that there exists a positive optimal tariff rate which maximizes welfare in a setting with endogenous labor and compare this result quantitatively with the standard models using constant labor supply. This paper also focuses on the welfare implications of a decline in trade barriers (in terms of tariffs). I utilize a version of computational general equilibrium model of international trade (based on Armington assumption) where countries are potentially asymmetric in terms of labor endowment, productivity, etc. Eaton and Kortum (2002) derive a simple formula which shows the gains from trade and this formula is generalized by Arkolakis, Costinot, and Rodriguez-Clare (2012) in the case of iceberg costs and exogenously fixed labor supply. I generalize this formula in Armington setup with tariffs and endogenous labor supply and highlight the importance of both revenue generating tariffs and consumption-leisure choice. |
| Keywords: | Endogenous Labor Supply, Optimal Tariff, Computational General Equilibrium, Welfare |
| JEL: | F10 F11 F16 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:7809653&r=int |
| By: | Marc Auboin; Floriana Borino |
| Abstract: | This paper looks at the extent to which the shift in the lower value added production to countries in the following development “tier” is actually becoming a reality. Several countries in East Asia have been upgrading production patterns and moving up the value chain, this paper looks at how this helps and offers new opportunities to less advanced countries to integrate in world trade. The paper uses a combination of techniques, from an analysis of disaggregated trade flows by country and sectors, to the calculation of trade intensity indices by country and sector, and value-added trade by sector. It finds combined evidence of forward and backward trade increasing between several neighbouring Asian economies and China, in the most labour-intensive industries in particular. Econometric analysis shows that relative unit labour costs are an explanatory factor of increased trade links. In cases, the intensification of trade links on the export side can relate to a strongly expanding local market (for example India for electronic products such as smartphones), but mostly the intensification of trade links takes place both on the import and export sides with markets which are much smaller than China (Vietnam, Bangladesh, etc.), and which experienced increased outward-processing activities as a result of China's production upgrade. |
| Keywords: | investment, trade policy, business cycles |
| JEL: | E22 F13 F44 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7194&r=int |
| By: | Naylor, Robin; Soegaard, Christian |
| Abstract: | Firms which face the threat of import competition from foreign rivals are conventionally seen as favouring import protection. We show that this is not necessarily the case when domestic firms’ input prices are determined endogenously. In a framework where the input price is determined through bargaining with an (upstream) input supplier, the relationship between a domestic (downstream) firm’s profits and the number of foreign competitors depends on trade costs. If trade costs are sufficiently high, then an increase in the number of foreign entrants can raise the profits of a downstream firm in a home market characterised by Cournot competition. The intuition for this result is that increased product market competition through the entry of foreign firms is mirrored by profit-enhancing moderation of the bargained input price. We examine a number of tariff and non-tariff barriers to international trade and identify conditions under which import-competing firms will favour the removal of barriers to foreign competition. |
| Keywords: | Financial Economics |
| Date: | 2018–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uwarer:269084&r=int |
| By: | Vacu, Nomfundo P.; Odhiambo, Nicholas M. |
| Abstract: | The study investigates the determinants of aggregate and disaggregated import demand for Tanzania, over the period 1985 to 2015. The study employed the autoregressive distributed lag (ARDL) bounds testing approach. The empirical results confirm that aggregate import demand is positively determined by investment spending and export of goods and services, both in the long run and short run, but negatively determined by trade liberalisation policy only in the short run. The long-run results confirm that import demand for consumer goods is positively determined by gross national income, but negatively determined by trade liberalisation policy. The import demand for intermediate goods is found to be positively determined by exports of goods and services and gross national income, but negatively determined by trade liberalisation policy. The results further show that exports of goods and services and relative import price are positive determinants of import demand for capital goods. In the short run, the results confirm that import demand for consumer goods is positively determined by export of goods and services, gross national income and import demand for consumer goods in the previous period, but negatively determined by gross national income in the previous period and trade liberalisation policy. The results further confirm that the import demand for intermediate goods is positively determined by exports of goods and services, but negatively determined by gross national income. Lastly, import demand for capital goods is found to be positively determined by import demand for capital goods in the previous period, exports of goods and services, and relative import price. |
| Keywords: | ARDL Approach, Import Demand, Aggregate Import Demand, Disaggregated Import Demand, Tanzania |
| Date: | 2018–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:uza:wpaper:24785&r=int |
| By: | Swinbank, Alan |
| Abstract: | The original CAP’s high levels of border protection on many products involved a variable import levy bridging the gap between world prices and the EU’s much higher minimum import price. The Uruguay Round ended this, but tariffication also meant that subsequent CAP reforms reducing EU levels of domestic market price support would no longer trigger lower tariffs. Moreover the Doha Round’s plans for tariff cuts are in abeyance. The consequences are: i) only preferential suppliers penetrate the EU’s protected market; ii) negotiation of Free Trade Areas is made more complicated; and iii) “Brexit” is problematic. |
| Keywords: | Agricultural and Food Policy |
| Date: | 2018–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa162:271976&r=int |
| By: | Chen, Natalie; Juvenal, Luciana |
| Abstract: | We explore whether the global …nancial crisis has had heterogeneous e¤ects on traded goods di¤erentiated by quality. Combining a dataset of Argentinean …rm-level destination-speci…c wine exports with quality ratings, we show that higher quality exports grew faster before the crisis, but this trend reversed during the recession. Quantitatively, the e¤ect is large: up to nine percentage points di¤erence in trade performance can be explained by the quality composition of exports. This ‡ight from quality was triggered by a fall in aggregate demand, was more acute when households could substitute imports by domestic alternatives, and was stronger for smaller …rms’ exports. |
| Keywords: | Financial Economics |
| URL: | http://d.repec.org/n?u=RePEc:ags:uwarer:270016&r=int |
| By: | Bown, Chad P. |
| Abstract: | How does trade policy treat intermediate inputs relative to other imported products? Slow economic and trade growth during the recovery from the Great Recession, as well as recent political developments in the United Kingdom and United States, pose a threat to cross-border supply chains and have thus brought this question to the forefront of policy circles. This paper investigates by examining new and detailed data on Group of 20 (G20) trade policy use through 2016, with a special emphasis on changes in policymaking behavior since 2010. First, there is no evidence that the G20 economies made significant changes to their applied import tariffs during this period. However, there has been a modest increase in import protection arising through other policy instruments of note such as the temporary trade barriers (TTBs) of antidumping, countervailing duties and safeguards. More importantly, there is evidence of changes in how countries have applied their TTBs. TTBs were increasingly imposed on imports not only from China, but also on imports from other countries, reversing a post-2001 trend. Furthermore, TTB protection has moved away from imports of final goods and toward imports of intermediate inputs. These shifts in policy have several potential contributing causes as well as economic consequences, including for cross-border supply chains. |
| Keywords: | antidumping; intermediate inputs; safeguards; Supply Chains; tariffs; temporary trade barriers; WTO |
| JEL: | F13 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13079&r=int |
| By: | Svanidze, Miranda; Götz, Linde |
| Abstract: | Given Russia’s leading position in the world wheat trade, how well its grain markets function becomes very important question to evaluate the state of future global food security. We use a threshold vector error correction model to explicitly account for the influence of trade costs and distance on price relationships in the grain markets of Russia and the USA. In addition, we study impact of market characteristics on regional wheat market integration. Empirical evaluation shows that distance between markets, inter-regional trade flows, export orientation, export tax and export ban all have a significant impact on the magnitude of wheat market integration. |
| Keywords: | Agricultural and Food Policy, Crop Production/Industries, Food Security and Poverty |
| Date: | 2017–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gewi17:262000&r=int |
| By: | Stepanok, Ignat (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "Standard theory predicts that falling trade costs lead to lower foreign direct investment (FDI), this is based on the known proximity-concentration trade-off. Evidence in recent decades shows however increasing trade volumes accompanied with higher FDI. I present in this paper a North-South growth model with endogenous and costly FDI. I show that for a sufficiently large Northern market trade liberalization is accompanied with higher FDI. In the model producing in the South and shipping to the North is cheaper than producing in the North. As a result of this investing in a plant in the South is accompanied by the closure of the Northern plant, the firm uses the South as an export platform to the North. Trade costs will be paid before and after FDI since the company always produces only in one location. If demand in the South is relatively higher, then moving production there would save on trade costs. If demand in the North is relatively higher however, then moving production to the South would increase trade costs. Trade liberalization decreases this jump in trade costs from moving production away from the larger North and increases the incentive to invest in the South." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | Handelsbilanz, Auslandsinvestitionen, Investitionsverhalten, Investitionstheorie |
| JEL: | F12 F23 F43 O31 O34 |
| Date: | 2018–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201819&r=int |
| By: | Manoel Bittencourt (School of Economic and Business Sciences, University of the Witwatersrand, Johannesburg); Matthew Clance (Department of Economics, University of Pretoria, Pretoria, South Africa); Yoseph Y. Getachew (Department of Economics, University of Pretoria, Pretoria, South Africa) |
| Abstract: | We study the effect of trade openness on fertility rates in fifty African countries during the 1970 – 2010 period. Allowing for country and time fixed effects, our results indicate that trade openness and imports of manufactured goods are related to lower fertility. Furthermore, trade with the former colonial powers and imports of high-skilled manufactured goods, which include television receivers and telecommunications equipment, are related to lower fertility too. Although Africa still export agricultural products and raw materials, and in contrast with the comparative-advantages prediction, our results suggest that the knowledge and gender norms emanating from imported high-skilled manufactured goods are affecting fertility choices and, ultimately, having a reinforcing effect on Africa's ongoing demographic transition. |
| Keywords: | openness, fertility, Africa |
| JEL: | J10 N37 O55 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:201856&r=int |
| By: | Takumi Naito (Vanderbilt University and Waseda University) |
| Abstract: | We explore the role of economic growth as a cause of reverse trade diversion in an asymmetric three-country Melitz model. A regional trade agreement between countries 1 and 2 decreases country 3's growth rate and the revenue shares of varieties country 3 exports to countries 1 and 2 in the short run, but increases them in the long run, compared with the old balanced growth path. This is because faster short-run growth in countries 1 and 2 than country 3 starts to increase the members' market entry costs more than the nonmember, thereby making the latter relatively more competitive. |
| JEL: | O1 O2 |
| Date: | 2018–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:van:wpaper:vuecon-sub-18-00008&r=int |
| By: | LI Zhigang; WEI Shang-Jin; ZHANG Hongyong |
| Abstract: | Using unique Japanese firm-level production network data combined with international trade data, we examine the upstream/downstream propagation effects of exchange rate shocks on the performance of indirect exporters/importers. Indirect exporters (importers) are defined as firms which do not export (import) by themselves but supply to (buy from) at least one exporting (importing) firm. We construct firm-specific export and import effective exchange rates to take account of the variations of exchange rate exposure across trading firms. We find significant and robust responses in sales and profitability of indirect exporters to exchange rate shocks of downstream exporting firms, which suggests the upstream propagation effect of exchange rate shocks. Both the sales and profitability of the indirect exporters improved significantly with yen depreciation in downstream industries. However, on the other hand, there is weak evidence on the responses of indirect importers to exchange rate exposure of upstream importing firms. Furthermore, the responses in sales and profitability are heterogeneous among direct and indirect exporters/importers by relative firm size and upstreamness in the production chains. Our results suggest that the stabilization of exchange rates is crucial to firm performance, especially to the small and medium enterprises engaging in indirect exporting, from the perspective of supply chains. |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:18058&r=int |
| By: | Cheptea, Angela; Gaigné, Carl |
| Abstract: | We analyse the impact of the Russian food embargo on European and Russian trade patterns using a triple-difference estimation strategy. We quantify the effects on the value of trade, the trade price of products covered by the ban, and the new trade flows generated by the ban. Our results point to an average e 125 million loss in monthly EU28 exports to Russia due to the ban (with Lithuania, Poland, and Germany bearing the largest losses). However, only 45% of the drop in EU28 exports of banned products to Russia would be due to the ban. In addition, EU products banned from the Russian market were sold elsewhere at lower prices. The reorientation of EU exports to other markets translated into selling larger amounts to old trade partners, as well as in accessing new markets. EU member states were unevenly affected by the ban. Germany and Poland compensated their large losses on the Russian market by a strong increase in exports to other trade partners (mostly intra-EU), at the expense of other EU acountries, such as France and Denmark. |
| Keywords: | International Relations/Trade |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ags:inrasl:276238&r=int |
| By: | Catia Batista (Universidade Nova de Lisboa, CReAM, IZA and NOVAFRICA); Julia Seither (Universidade Nova de Lisboa, University of California at Berkeley, and NOVAFRICA); Pedro C. Vicente (Universidade Nova de Lisboa, BREAD, and NOVAFRICA) |
| Abstract: | What is the role of international migrants and, specifically, migrant networks in shaping political attitudes and behavior in migrant sending countries? Our theoretical framework proposes that migration might change individual social identities and thus stimulate intrinsic motivation for political participation, while it may also improve knowledge about better quality political institutions. Hence, international migration might increase political awareness and participation both by migrants and by other individuals in their networks. To test this hypothesis, we use detailed data on different migrant networks (geographic, kinship, and chatting networks), as well as several different measures of political participation and electoral knowledge (self-reports, behavioral, and actual voting measures). These data were purposely collected around the time of the 2009 elections in Mozambique, a country with substantial emigration to neighboring countries – especially South Africa - and with one of the lowest political participation rates in the region. The empirical results show that the number of migrants an individual is in close contact with via regular chatting significantly increases political participation of residents in that village – more so than family links to migrants. Our findings are consistent with both improved knowledge about political processes and increased intrinsic motivation for political participation being transmitted through migrant networks. These results are robust to controlling for self-selection into migration as well as endogenous network formation. Our work is relevant for the many contexts of South-South migration where both countries of origin and destination are recent democracies. It shows that even in this context there may be domestic gains arising from international emigration. |
| Keywords: | International migration, social networks, political participation, information, diffusion of political norms, governance |
| JEL: | D72 D83 F22 O15 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:1813&r=int |
| By: | Sanjuan Lopez, A.I.; Peci, J. |
| Abstract: | The objective is to quantify the trade impact and calculate the ad-valorem equivalent (AVE) of the nontariff measures (NTMs) affecting pork meat trade with China. A gravity equation is estimated for this purpose using the Poisson Pseudo Maximum Likelihood (PPML) estimator. The gravity equation is expanded to include the regulatory intensity or frequency of NTMs, which is further split into the 17 categories (to 4-digit), 14 SPS (Sanitary and Phytosanitary) and 3 TBT (Technical Barriers to Trade), currently in place in China. NTMs data comes from the Trade Analysis Information System (TRAINS) accessed through WITS. Eleven categories have a significant impact on trade, six of which have a trade restricting impact. In this sense, our results concur with the recent literature that posits both, restricting and enhancing trade impacts. Besides, AVE calculation posits a clear hierarchy across categories, where most restrictive are higher than Chinese tariffs (34% versus 15%). Furthermore, simulation illustrates that total removal of NTMs would double bilateral trade between the EU and China. While removal maybe unconceivable as it could conflict with domestic policy aiming at safeguarding food safety, the simulation shows a maximum threshold that could be reached by means of harmonization and/or mutual recognition. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:275985&r=int |
| By: | Irena Mikolajun; Jean-Marie Viaene |
| Abstract: | In the struggle between the forces of free trade and the restrictive influence of insularism the latter recently seems to have the upper hand. This is illustrated by the referendum of June 23, 2016 where the United Kingdom (UK) voted to leave the European Union (EU). In this paper we evaluate the consequences of this event for EU integration. In particular, we analyze how the extent of EU economic integration would change once the UK leaves the Union. To that end we develop an integration benchmark that consists of the steady state production equilibrium characterized by arbitrage pricing and perfect factor mobility. We apply metrics to measure the distance between this benchmark and the data. We find that the integration in the EU is incomplete and its trend is non-linear while Brexit would not bring negative consequences to its development.. |
| Keywords: | Brexit, regional integration, Euclidean distance, factor mobility, arbitrage pricing, reflected geometric Brownian motion |
| JEL: | E13 F15 F21 F40 O11 O53 O54 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7199&r=int |
| By: | Ferto, Imre |
| Abstract: | We use 6-digit bilateral trade data to document the evolution on the extensive and intensive product margins of agri-food trade in the EU over the period 2000 and 2015. In line with previous research our results confirm the importance of extensive margin in the EU’s agri-food trade. We show that importance of margins may vary according to product differentiations. Econometric analysis reveals that drivers are similar for extensive and intensive margins. In addition, the impacts of trade cost variables differs between extensive and intensive margins according to product differentiations. Our results are relatively robust to alternative definitions of trade margins and product classifications. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade |
| Date: | 2018–04–17 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc18:273496&r=int |
| By: | Deng-Shing Huang (Institute of Economics, Academia Sinica, Taipei, Taiwan); Yo-Yi Huang (Institute of Economics, Academia Sinica, Taipei, Taiwan); Ching-lung Tsay (Institute of Applied Economics, National Taiwan Ocean University) |
| Abstract: | Based on the existing hubness measure in the trade literature, we developed two modified trading-hub index in two directions, export-destination and import-source. Then we demonstrate the stylized fact of China-and-Japan’s double trading-hub, especially in export-destination sense, in East Asia since the early 1990s. After showing the dynamics of the twin-hub, more specifically the rising China-hub and shrinking Japan-hub, theoretical explanations, such as the home-market effect (HME), FDI and technology advantage etc. are provided. Finally, a panel data ranged from 1993 to 2014 of thirteen economies, including eleven economies in East Asia, USA and EU as a whole, are established to conduct empirical tests. In general, the empirical results support the role of HME, FDI and technology advantage for making a trading-hub, in terms of export-destination and/or import-sources. |
| Keywords: | : Double Trading-Hub, Export Destination Hub, Import-Source Hub, Homemarket effect, Technology Advantage |
| JEL: | F14 F15 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:sin:wpaper:18-a007&r=int |
| By: | Takumi Naito (Vanderbilt University and Waseda University) |
| Abstract: | To examine the effects of asymmetric trade liberalization on countries' long-run growth and welfare through intraindustry reallocations, we extend the Rivera-Batiz--Romer lab-equipment model of growth with expanding input varieties to include both heterogeneous firms and asymmetric countries. We first derive extended ACR (Arkolakis--Costinot--Rodriguez-Clare) formulas for long-run growth and welfare changes even with asymmetric countries. In our baseline calculation, the total long-run welfare effect of greater openness (expressed in flow terms) is about four times as large as the static counterpart. Finally, we show that even unilateral trade liberalization always raises both countries' long-run growth and welfare. |
| JEL: | F1 |
| Date: | 2018–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:van:wpaper:vuecon-sub-18-00009&r=int |
| By: | Priya Ranjan (Department of Economics, University of California-Irvine); Giray Gozgor (Istanbul Medeniyet University) |
| Abstract: | We construct a theoretical model to capture the compensation and efficiency effects of globalization in a set up where the redistributive tax rate is chosen by the median voter. The model predicts that the two alternative modes of globalization- trade liberalization and financial openness- could potentially have different effects on taxation. We then provide some empirical evidence on the relationship between taxation and the alternative modes of globalization using a large cross-country panel dataset. We make a distinction between de jure and de facto measures of globalization and find a robust negative relationship between de jure measures financial openness and tax rates. There is no robust relationship between de facto measures of finanical openness and taxation. As well, the relationship between trade liberalization (both de jure and de facto measures) and tax rates is not robust and depends on the measures of taxation as well as the time period of analysis. |
| Keywords: | Trade liberalization; capital market openness; redistributive taxation; median voter |
| JEL: | F11 F21 H11 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:irv:wpaper:181903&r=int |
| By: | Fertő, Imre; Bakucs, Zoltán; Fałkowski, Jan |
| Abstract: | While the positive effect of economic integration on trade is commonly accepted, we still lack a proper understanding of the complex patterns behind this phenomenon. In particular, it is important to better understand how the structure of trade linkages evolves. This is because there are reasons to assume that countries within an economic integration agreement do not trade with each other on random basis. On the contrary, one may argue that they select trade linkages and this choice may be driven by various factors. In this paper we test two specific predictions that originate from the recent literature and which could be informative in this respect. First, we show that the size of the initial trade network is positively correlated with building new trade linkages. In other words, a greater initial number of trading partners facilitates establishing new connections. Second, we also provide some evidence in support of the hypothesis that the evolution of trade network for a given country depends on the trade network of its trading partners. In this case however, our results are slightly less robust. |
| Keywords: | International Relations/Trade, Livestock Production/Industries |
| Date: | 2017–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc17:258656&r=int |
| By: | Hillen, J. |
| Abstract: | In Switzerland, a number of different border protection policies are in place for dairy products as a result from stepwise market opening. While dairy products such as butter and milk powder are still subject to tariffs and tariff rate quotas, cheese trade with the EU is fully liberalized. It is not well-understood how such different types and levels of protection affect spatial price transmission for the respective products and the underlying raw milk. Therefore, we analyze price transmission between Germany and Switzerland for several dairy products at the wholesale level, and for raw milk producer prices. We find that not the degree of public border protection and the resulting trade volumes determine the degree and speed of spatial price transmission, but rather the qualitative differentiation of the Swiss products. While prices of tariff-protected dairy products are influenced by German price developments, cheese prices are not. Also at the producer level, raw milk prices for cheese processing are less strongly linked to foreign prices than milk prices for industrial dairy production. Our results suggest that for small high-income countries such as Switzerland, promoting high-quality products and hence reducing international substitutability alleviates international price pressure more than public protectionism via tariffs. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade, Livestock Production/Industries |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iaae18:276015&r=int |
| By: | Chudik, Alexander (Federal Reserve Bank of Dallas); Koech, Janet (Federal Reserve Bank of Dallas); Wynne, Mark A. (Federal Reserve Bank of Dallas) |
| Abstract: | The growth of globalization in recent decades has increased the importance of external factors as drivers of the business cycle in many countries. Globalization affects countries not just at the macro level but at the level of states and metro areas as well. This paper isolates the relative importance of global, national and region-specific shocks as drivers of the business cycle in individual U.S. states and metro areas. We document significant heterogeneity in the sensitivity of states and metro areas to global shocks, and show that direct trade linkages are not the only channel through which the global business cycle impacts regional economies. |
| Keywords: | Global and regional business cycles; U.S. state and metro employment fluctuations; Global VAR (GVAR) approach |
| JEL: | E24 E32 |
| Date: | 2018–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:fip:feddgw:343&r=int |
| By: | Ferguson, Shon (Research Institute of Industrial Economics (IFN)); Henrekson, Magnus (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Policymakers in several countries have recently taken steps to promote the rapid export expansion of high-tech small- and medium-sized enterprises (SMEs). The goal of these policies has been to create successful export-intensive firms, which are often referred to as born globals. To the best of our knowledge, we are the first to study born globals in computing using firm-level register data, which cover the universe of firms in a particular country and sector. Using data on all Swedish computing startups founded 2007–2015, we find a systematic positive relationship between the propensity of a computing firm to reach customers globally via digital platforms and its long-run employment growth relative to domestically-oriented computer firms. We find mixed evidence that born globals in computing grow faster in terms of sales or value added. Our analysis also indicates that very few computing firms fit the profile of born globals; only 15 percent of the 250 largest computing employers in 2015 were born globals. Moreover, only 1.5 percent of computing startups founded 2007–2015 were computer game publishers, which arguably have the highest propensity to be born global. Thus, although we find positive born global effects at the firm level, policymakers must be aware that encouraging more born globals need not necessarily lead to large benefits for the overall economy. |
| Keywords: | Born globals; Computing industry; Exporting; Firm growth; Globalization; Job creation |
| JEL: | F14 F23 L25 M13 |
| Date: | 2018–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1224&r=int |
| By: | Fiankor, Dela-Dem Doe; Flachsbarth, Insa; Masood, Amjad; Brümmer, Bernhard |
| Abstract: | With increasing global agrifood trade, private food standards and certifications have proliferated. Yet, their trade effects remain ambiguous. We provide further empirical evidence by assessing the effect of GlobalGAP certification on agrifood exports to high-value markets in EU and OECD countries. Empirically, we estimate a structural gravity model—that accounts for zero trade and endogeneity of certification—using a novel dataset of certified producers and land area cultivated to apples, bananas, and grapes from 2010 to 2015. While our results generally confirm the trade-enhancing effect of GlobalGAP certification for both developed and developing countries, we show that the effects vary across products. |
| Keywords: | Agribusiness, Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, International Development, International Relations/Trade |
| Date: | 2017–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gagfdp:265632&r=int |
| By: | David Kohn (Universidad Catolica de Chile); Fernando Leibovici (Federal Reserve Bank of St. Louis); Michal Szkup (The University of British Columbia) |
| Abstract: | We study the role of financial frictions and balance-sheet effects in account- ing for the dynamics of aggregate exports, output, and investment in large devaluations. We investigate a small open economy with heterogeneous firms and endogenous export decisions, in which firms face financing constraints and debt can be denominated in foreign units. We find that these channels can explain only a small fraction of the dynamics of exports observed in the data since financially-constrained exporters increase exports by reallocating sales across markets. We show analytically the role of this mechanism on exports adjustment and document its importance using plant-level data. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:949&r=int |
| By: | Wilhelm Kohler; Bohdan Kukharskyy |
| Abstract: | We develop a theoretical framework to explain firms’ offshoring decisions in the presence of uncertainty. This model highlights the role of labor market institutions in shaping a firm’s ability to effectively react upon future shocks, yielding a sharp prediction of the prevalence of offshoring in a given industry: The propensity of firms to source intermediate inputs from foreign rather than domestic suppliers decreases in a foreign country’s labor market rigidity, and this effect is particularly pronounced in industries with higher volatility. Combining industry-level data on the U.S. offshoring intensity with measures of labor market rigidity and industry volatility, we find empirical evidence strongly supportive of the model’s predictions. |
| Keywords: | offshoring, uncertainty, labor market rigidity, industry volatility |
| JEL: | F14 F16 F23 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7173&r=int |
| By: | He, Yong |
| Abstract: | In my previous publication with a model to illustrate the key role of intra-national trade in developing countries, it was established that intra-national trade, together with international trade, form a network in which high growth achieved by the developed regions spills over to the less developed regions. This study aims at providing econometrical evidence to support this theoretical conjecture. Using China’s 2007 foreign trade data and provincial input-output tables, the key variables on intra- and international imports of technological inputs are made for estimating their impacts over the outputs in production functions at the province and sector levels. It is found that in the less developed regions, intra-national imports rather than international ones made significant contribution to production. In the developed regions, these impacts were just inversed. These results confirm the existence of the trade network in which mainly the former benefited from the spillovers via intra-national trade, while the latter gained this benefit via international trade. |
| Keywords: | intra-national trade; intra-national spillovers; regional input-output tables; regional disparity. |
| JEL: | F1 O1 O4 R1 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:88780&r=int |
| By: | Miriam Manchin; Sultan Orazbayev |
| Abstract: | Using a large individual-level survey spanning several years and more than 150 countries, we examine the importance of social networks in influencing individuals' intention to migrate internationally and locally. We distinguish close social networks (composed of friends and family) abroad and at the current location, and broad social networks (composed of same-country residents with intention to migrate, either internationally or locally). We find that social networks abroad are the most important driving forces of international migration intentions, with close and broad networks jointly explaining about 37% of variation in the probability intentions. Social networks are found to be more important factors driving migration intentions than work-related aspects or wealth (wealth accounts for less than 3% of the variation). In addition, we nd that having stronger close social networks at home has the opposite effect by reducing the likelihood of migration intentions, both internationally and locally. |
| Keywords: | intention to migrate; social networks; international migration; local migration; remittances |
| JEL: | F22 F24 R23 O15 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:cid:wpfacu:90a&r=int |
| By: | Alejandro Cuñat; Robert Zymek |
| Abstract: | We generalise the traditional development-accounting framework to an open-economy setting. In addition to factor endowments and productivity, relative factor costs emerge as a source of real-income variation across countries. These are shaped by bilateral trade determinants (which underpin the patterns of “international value-added linkages”) and the global distribution of factor endowments and final expenditures. We use information on endowments, trade balances and value-added trade to back out the relative factor costs of 40 major economies in a theory-consistent manner. This reduces the variation in “residual” productivity required to explain the observed per-capita income differences by more than one half. |
| Keywords: | world input-output, development accounting, productivity |
| JEL: | E01 F15 F40 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7196&r=int |
| By: | Vlahovic, Branislav; Mugosa, Izabela; Radojevic, Vuk |
| Abstract: | This paper analyses the possibility of the EU cheese export improvement by getting into the market of the League of Arab States. The most significant final dairy product is cheese. Regarding geography and continents, Europe is top cheese manufacturer in the world. The European Union (EU) has the largest share within the production structure in Europe. Arab League imports EU cheese in the amount of EUR 643.7 million, i.e. this market absorbs 39% share of total cheese value. Abovementioned indicators demonstrate that it is possible to increase market participation of the EU countries in this market in the following period. |
| Keywords: | International Relations/Trade |
| Date: | 2018–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa162:272735&r=int |
| By: | Tseveenbolor Davaa; David Kiefer; Valeria Szekeres |
| Abstract: | This paper examines the effects of macroeconomic policy reforms of trade and investment liberalization on gender earnings inequality during the post-transition period using panel data from Hungarian Wage and Earnings Survey and other statistical sources for 21 industrial categories. The results of the econometrics analysis with regression estimations show that while both women and men in foreign-invested enterprises earned more than their counterparts employed in domestically-owned enterprises, women earned less in export-oriented enterprises than in domestic market-oriented enterprises, while men’s earnings are not significantly different in export versus domestic. Also foreign direct investment (FDI) inflows and export orientation contributed to a greater gender earnings difference. While FDI enterprises dominantly contribute to export growth in Hungary, the tests indicate that these two features had independent effects on earnings levels and gaps. These results hold after controlling for human capital variables (average age and education level in industry), industrial segmentation (female share of employment), labor productivity, and the economic cycle (unemployment rates). This study, a first for Hungary, contributes to research of wage gaps in post-transition economies. |
| Keywords: | Gender earnings inequality, transition economy, economic liberalization, free trade, foreign direct investment JEL Classification: F6, J3, B540 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:uta:papers:2018_03&r=int |
| By: | Serences, Roman; Kutisova, Jana |
| Abstract: | The article judges the efficiency and the competitiveness of selected commodities of animal production, plant production and food-processing industry. Competitiveness and efficiency of the commodities was measured Revealed Comparative Advantage Index and Grubel-Lloyd Index. In the conclusion, there is a summary of values of Comparative Advantage Index of selected commodities in chosen years. |
| Keywords: | International Relations/Trade |
| Date: | 2018–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa162:271975&r=int |
| By: | Nelson Lind (Emory University); Natalia Ramondo (UCSD) |
| Abstract: | We develop a trade model in which productivity—the result of a country’s ability to adopt global technologies—presents an arbitrary pattern of spatial correlation. The model generates the full class of import demand systems consistent with Ricardian theory, and, hence, captures its full macroeconomic implications. In particular, our framework formalizes Ricardo’s insight—absent from the canonical Ricardian model— that countries gain more from trade partners with relatively dissimilar technology. Incorporating this insight into the calculations of macro counterfactuals entails a simple correction to self-trade shares. We also present aggregation results that tie micro-optimization to macro demand systems and guide counterfactual analysis based on micro estimates. Our quantitative application using a multi-sector trade model suggests that countries specialized in low correlation sectors have 40 percent higher gains from trade relative to countries specialized in high correlation sectors. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:627&r=int |
| By: | Sébastien Laffitte; Farid Toubal |
| Abstract: | Using aggregate data on U.S. multinational firms’ activities, we document the impact of tax havens on the organization and trade of multinational firms. Conventional wisdom says that MNEs set up foreign sales platforms close to large markets to benefit from the proximity to consumers. We show, both theoretically and empirically, that the tax environment plays an important role in explaining the location of the foreign sales platforms. We document that foreign sales platforms in tax havens fuel profit shifting especially in services industries. We shed lights on the attractiveness of different tax havens for distinctive sectoral activities. The back-of-the-envelope computation shows that profit shifting by foreign sales platforms in tax haven amounts to $83bn in 2013. |
| Keywords: | foreign platforms, tax havens, profit shifting, firms’ organization |
| JEL: | F23 H26 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7171&r=int |
| By: | Hill, Berkeley |
| Abstract: | More than twenty studies have been identified that are directly relevant to assessing the impact of Brexit on UK agriculture, almost all of which have appeared in the last two years. They differ in many respects, including: how many of the four major change elements (domestic policy, UK/EU trade arrangements, restrictions on migrant labour, and the regulatory burden) are considered and how they are specified; the data sources drawn upon and periods to which they relate; which UK countries are covered; the sophistication of the models used to assess changes in commodity prices; how the impacts at farm level are estimated (though some do not involve this stage and stop at aggregate level); the time horizon used, and so on. However, the three chosen for detailed presentation in this symposium share the following characteristics: • they use closely-specified scenarios to explore the possible post-Brexit UK situations • they produce independent and original results, and • they assess the impacts at farm level, with a breakdown at least by farming types Presenters will focus on the scenarios employed and the results generated. There will be opportunity in discussions to compare and contrast the approaches and their results. |
| Keywords: | Agricultural and Food Policy, International Development |
| Date: | 2018–04–17 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc18:273502&r=int |
| By: | Dalheimer, Bernhard; Brümmer, Bernhard; Jaghdani, Tinoush Jamali |
| Abstract: | While export restrictive policy has long been associated with increasing food price volatility, it has received minimal attention in the empirical literature compared to other potential drivers of international food price fluctuations. This paper aims at closing this gap by firstly quantifying the relevant policies in an indicator of export restrictive policy. Subsequently, the effects of that are tested on estimated realized and GARCH volatility in VAR-X models where various wheat price volatilities are allowed to be endogenously determined. In a second step, the impacts of export controls during times of market turmoil are assessed in asymmetric volatility models. This strategy succinctly reveals the effects of export controls along the policy, frequency, country and time dimensions providing a detailed set of evidence. It is found that, most pronounced effects on wheat price volatility stem from long-term quotas. Similarly, longer term prohibitions of some countries have impacted wheat price fluctuation as well. On the contrary, long term tax strategies are shown to not significantly impact wheat price volatility. However, during times of market turmoil all three considered export restrictions have particularly contributed to wheat price volatility. Strengthened and more binding WTO regulation could have led to significantly less food price volatility, especially in times of food price crisis, such as recently experienced during the 2007/08 and 2010/11 episodes. |
| Keywords: | Agricultural and Food Policy, Demand and Price Analysis, International Relations/Trade |
| Date: | 2017–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gewi17:262151&r=int |
| By: | David S. Jacks; Dennis Novy |
| Abstract: | We examine the evolution of market potential and its role in driving economic growth over the long twentieth century. Theoretically, we exploit a structural gravity model to derive a closed-form solution for a widely-used measure of market potential. We are thus able to express market potential as a function of directly observable and easily estimated variables. Empirically, we collect a large dataset on aggregate and bilateral trade flows as well as output for 51 countries. We find that market potential exhibits an upward trend across all regions of the world from the early 1930s and that this trend significantly deviates from the evolution of world GDP. Finally, using exogenous variation in trade-related distances to world markets, we demonstrate a significant causal role of market potential in driving global income growth over this period. |
| Keywords: | economic geography, market potential, structural gravity, trade costs |
| JEL: | F10 N70 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7164&r=int |
| By: | Marwa Lazreg (Université de Sousse); Ezzeddine Zouari (Université de Sousse) |
| Abstract: | Our goal in this paper is the study of the impact of FDI on poverty and sustainable development in the case of Tunisia and during the study period from 1985 to 2015. In addition, we used the test unit root of cointegration test, the model error correction of FMOLS and Granger causality. In the case of Tunisia, we find that all variables are integrated of order 1. Thus, we can use the cointegration test. Indeed, the result of the null hypothesis test of no cointegration was rejected at the 5% threshold, which explains the presence of a cointegration relationship between FDI, sustainable development and poverty. Finally, we present and interpreted the results of the estimated FMOLS model and Granger causality test to study the contribution of FDI to the poverty reduction and sustainable development in Tunisia. We find that the LIDE variable measuring foreign direct investment has a significant negative impact on the GINI index. We notice the LCO2 variable that measures the CO2 emissions has a negative and significant impact on poverty as measured by the poverty gap at $ 1.91. We prove that direct foreign investments have a significant negative impact on CO2 emissions. We find that the LIDE variable measuring foreign direct investment has a significant negative impact on the GINI index. We notice the LCO2 variable that measures the CO2 emissions has a negative and significant impact on poverty as measured by the poverty gap at $ 1.91. We prove that direct foreign investments have a significant negative impact on CO2 emissions. We found that the LIDE variable measuring foreign direct investment has a significant negative impact on the GINI index. We notice the LCO2 variable that measures the CO2 emissions has a negative and significant impact on poverty as measured by the poverty gap at $ 1.91. We prove that direct foreign investments have a significant negative impact on CO2 emissions |
| Keywords: | cointegration,FMOLS,CO2 emissions,poverty,IDE |
| Date: | 2018–04–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01756733&r=int |
| By: | Rogelio Mercado Jr. (South East Asian Central Banks (SEACEN) Research and Training Centre) |
| Abstract: | Using bilateral capital flows data from 10 advanced reporting economies—with over 186 bilateral country pairs—for 2000 to 2016, this paper provides strong evidence on the significance of gravity factors, including distance and bilateral trade ties, in explaining cross-border financial asset flows. This finding is new to the capital flows literature that consider push and pull factors. In addition, this study offers new evidence of regional contagion as bilateral capital flows decrease more for country pairs with closer geographic proximity (or with less information frictions) than those that are farther apart when global risk aversion rises. These findings have policy implications on the importance of information frictions, bilateral trade ties, and regional cooperation on bilateral financial asset flows. |
| Keywords: | bilateral capital flows, information frictions, bilateral factors |
| JEL: | F21 F36 G10 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep0818&r=int |
| By: | Julien Gourdon (OECD) |
| Abstract: | The OECD developed a taxonomy of measures affecting government procurement which provides a classification system for different GP measures, policies and procedures, which can impact cross-border government procurement. This project aims to further assist countries in assessing their procurement regimes by mapping the taxonomy against international good practices. The project maps the taxonomy against both the WTO Government Procurement Agreement and the UNCITRAL Model Law on Public Procurement (2011). It further tests this methodology with data collection in four ASEAN countries (Indonesia, Malaysia, Philippines and Viet Nam). |
| Keywords: | Asia, Government procurement, Government Procurement Agreement (GPA), international trade, public good, regulation |
| JEL: | F13 F53 H41 H57 K20 N55 |
| Date: | 2018–09–05 |
| URL: | http://d.repec.org/n?u=RePEc:oec:traaab:216-en&r=int |
| By: | Vasiliki Fouka (Stanford University); Soumyajit Mazumder (Harvard University); Marco Tabellini (Harvard Business School, Business, Government and the International Economy Unit) |
| Abstract: | How does the appearance of a new out-group affect the economic, social, and cultural integration of previous outsiders? We study this question in the context of the first Great Migration (1915-1930), when 1.5 million African Americans moved from the US South to urban centers in the North, where 30 million Europeans had arrived since 1850. We test the hypothesis that black inflows led to the establishment of a binary black-white racial classification, and facilitated the incorporation of - previously racially ambiguous - European immigrants into the white majority. We exploit variation induced by the interaction between 1900 settlements of southern-born blacks in northern cities and state-level outmigration from the US South after 1910. Black arrivals increased both the effort exerted by immigrants to assimilate and their eventual Americanization. These average effects mask substantial heterogeneity: while initially less integrated groups (i.e. Southern and Eastern Europeans) exerted more assimilation effort, assimilation success was larger for those that were culturally closer to native whites (i.e. Western and Northern Europeans). These patterns are consistent with a framework in which perceptions of racial threat among native whites lower the barriers to the assimilation of white immigrants. |
| Keywords: | Immigration, assimilation, Great Migration, race, group identity. |
| JEL: | J11 J15 N32 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:19-018&r=int |
| By: | Eleonora Alabrese; Sascha Becker; Thiemo Fetzer; Dennis Novy |
| Abstract: | Previous analyses of the 2016 Brexit referendum used region-level data or small samples based on polling data. The former might be subject to ecological fallacy and the latter might suffer from small-sample bias. We use individual-level data on thousands of respondents in Understanding Society, the UK’s largest household survey, which includes the EU referendum question. We find that voting Leave is associated with older age, white ethnicity, low educational attainment, infrequent use of smartphones and the internet, receiving benefits, adverse health and low life satisfaction. These results coincide with corresponding patterns at the aggregate level of voting areas. We therefore do not find evidence of ecological fallacy. In addition, we show that prediction accuracy is geographically heterogeneous across UK regions, with strongly pro-Leave and strongly pro-Remain areas easier to predict. We also show that among individuals with similar socioeconomic characteristics, Labour supporters are more likely to support Remain while Conservative supporters are more likely to support Leave. |
| Keywords: | aggregation, ecological fallacy, European Union, populism, referendum, UK |
| JEL: | D72 I10 N44 R20 Z13 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7193&r=int |
| By: | Bangmarigu, Emmanuel; Qineti, Artan |
| Abstract: | The objective of this paper is to analyse the production and export of Cocoa in Ghana. Concerns about declining output and export of cocoa in Ghana has prompted the necessity of this study. Given the significance of Ghana as the principal producer and exporter of cocoa and a major source of foreign earnings in the country, it is imperative to analyze the production and export trend of the industry. This study review cocoa production and export in Ghana over a 21 year period spanning from 1995 to 2016. Time series data were employed and these were collected from FOA database and other secondary sources from Literatures and books to process the data. We assessed the country’s production and export trend by using both empirical and descriptive approaches which were checked by multivariate statistical analysis. The results suggest that total cocoa production and export in Ghana both witnessed an average year-over- year increase of 5.3% and 5.7% respectively. In spite of these improvements observed, there is potential for further improvement and this can be achieved through government support to the subsector. |
| Keywords: | International Relations/Trade |
| Date: | 2018–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa162:272051&r=int |
| By: | Assaf Razin; Efraim Sadka |
| Abstract: | In this paper we review of literature and offer historical, empirical and analytical explanation for the interactions between the welfare state and globalization driving forces. Globalization – a widespread contemporaneous phenomenon – generates international tax competition. The consequent erosion in the tax base, especially on capital, is another blow to the finances of the welfare state. Financial globalization facilitates reallocation of capital across borders. The increased mobility of capital may likely to trigger a race-to-the-bottom tax competition. The consequent erosion in the tax base, especially on capital, is potentially a blow to the fiscal finance backing up the far-reaching redistribution of income by the typical welfare state. Another major aspect of globalization, low skill migration, attracted to the welfare state may put additional strain on it. An aging welfare-state – a common contemporary phenomenon in many industrial countries calls for young and high skill immigrants for its survival. |
| JEL: | F0 F15 F22 H2 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24919&r=int |
| By: | Cage, Julia; Gadenne, Lucie |
| Abstract: | This paper documents the fiscal cost of trade liberalization: the extent to which countries are able to recover the trade tax revenues lost from liberalizing trade by increasing tax revenues from other sources. Using a novel dataset on government revenues over the period 1792-2006 we compare the fiscal impact of trade liberalization in developing countries and in today’s rich countries at earlier stages of development. We find that trade liberalization episodes led to larger and longer-lived decreases in total tax revenues in developing countries since the 1970s than in rich countries in the 19th and early 20th centuries. Half the developing countries in our sample experience a fall in total tax revenues that lasts more than ten years after an episode. Results are similar when we consider government expenditures, suggesting decreases in trade tax revenues negatively affect governments’ capacity to provide public services in many developing countries. |
| Keywords: | Financial Economics |
| Date: | 2016–10–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uwarer:269314&r=int |
| By: | Götz, Linde; Jaghdani, Tinoush Jamali |
| Abstract: | The pork sector has been at the centre of Russia’s import substitution policy. It has shown a very dynamic development reaching the government’s aim to increase self-sufficiency to 85% in 2015. However, this policy is facing several challenges. Results of a DCC-MGARCH model confirm our hypothesis that price volatility and thus risk have increased strongly in the pork supply chain in Russia. Concurrently, the volatility spill-overs between the price of slaughtered pork and the price of live swine have more than doubled, indicating increased price interdependence. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade, Risk and Uncertainty |
| Date: | 2017–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gewi17:262003&r=int |
| By: | Erik Brynjolfsson; Xiang Hui; Meng Liu |
| Abstract: | Artificial intelligence (AI) is surpassing human performance in a growing number of domains. However, there is limited evidence of its economic effects. Using data from a digital platform, we study a key application of AI: machine translation. We find that the introduction of a machine translation system has significantly increased international trade on this platform, increasing exports by 17.5%. Furthermore, heterogeneous treatment effects are all consistent with a substantial reduction in translation-related search costs. Our results provide causal evidence that language barriers significantly hinder trade and that AI has already begun to improve economic efficiency in at least one domain. |
| JEL: | D8 F1 F14 O3 O33 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24917&r=int |
| By: | Joël Hellier (University of Lille and University of Nantes, France) |
| Abstract: | We build a simple model in which (i) households select their country of residence depending on income taxation and on the cost of migrating and living abroad, and (ii) globalization comes with a decrease in the cost of migration. Globalization leads to (i) a maximum between-country income-tax gap which is lower for the high incomes, (ii) a decrease in income tax rates and (iii) a convergence in the taxation structures of the different countries. In addition, globalization generates changes in income tax schedules and redistribution which display three successive stages. In the first stage, the redistribution goal is consistent with tax progressivity. In the second stage, the tax schedule becomes regressive at the top. Thirdly, if the migration cost continues to decline, the government can typically not achieve its redistribution goal, even if redistribution is its first priority, and there is no equilibrium taxation schedule, the tax structure becoming volatile. These results are in line with observed facts. Finally, the model shows that globalization tends to generate and magnify a trade-off between less redistribution and less tax progressivity. This provides an explanation for the middle class curse and the social democrat curse experienced by a large majority of advanced countries over the last three decades. |
| Keywords: | globalization, income tax, migration, progressivity, redistribution, tax competition. |
| JEL: | F22 H23 H24 H26 I38 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2018-464&r=int |
| By: | Tschirley, D.; Reardon, T.; Minten, B.; Liverpool-Tasie, S. |
| Abstract: | Research by Michigan State University and the International Food Policy Research Institute under the Food Security Policy Innovation lab has documented profound changes taking place in African agrifood systems, driven by rapid urbanization, growth in per capita incomes, and the increasing reach of globalized markets over the past fifteen- to twenty years. Based on detailed analysis of household expenditure data sets across East and Southern Africa, processed food inventories in eight cities of three countries, and ongoing survey research on rapidly growing and transforming value chains (teff in Ethiopia, poultry in Nigeria, and grain milling in Tanzania), this Policy Research Brief does three things: (1) summarizes the key research findings; (2) identifies the risks that these patterns of change imply for sustained and inclusive growth; and (3) highlights implications of the patterns and the implied risks for the design of policies and value chain programs in this dynamic environment. |
| Keywords: | Agricultural and Food Policy, Food Security and Poverty, International Development |
| Date: | 2017–04–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:miffpb:260427&r=int |