nep-int New Economics Papers
on International Trade
Issue of 2020‒07‒20
48 papers chosen by
Luca Salvatici
Università degli studi Roma Tre

  1. Rising Protectionism and Global Value Chains: Quantifying the General Equilibrium Effects By Cappariello, Rita; Franco-Bedoya, Sebastian; Gunnella, Vanessa; Ottaviano, Gianmarco
  2. The Impact of Chinese Technical Barriers to Trade on its Manufacturing Imports By Mahdi Ghodsi
  3. Trade Liberalization and Economic Growth – A Study on Ghana, Nigeria and Cote d`Ivoire By Francis Amoasah
  4. Estimating the Trade and Welfare Effects of Brexit: A Panel Data Structural Gravity Model By Harald Oberhofer; Michael Pfaffermayr
  5. Global Value Chains and the Removal of Trade Protection By Bown, Chad P.; Erbahar, Aksel; Zanardi, Maurizio
  6. International Trade and Labor Market Integration of Immigrants By Lodefalk, Magnus; Sjöholm, Fredrik; Tang, Aili
  7. Globalization of Markets and Ethnocentrism: New Insights for the Environment By Ornella Tarola; skerdilajda Zanaj
  8. The impact of Brexit on Africa in times of the Corona Crisis By Kohnert, Dirk
  9. The Political Economy of Populism By Guriev, Sergei; Papaioannou, Elias
  10. China’s Import Demand for Agricultural Products: The Impact of the Phase One Trade Agreement By Robert C. Feenstra; Chang Hong
  11. A Model of Global Beverage Markets By Anderson, Kym; Wittwer, Glyn
  12. Individual Preferences on Trade Liberalization: Evidence from a Japanese Household Survey By Gabriel Felbermayr; Toshihiro Okubo
  13. From UK land-bridge to sea route: Irish agri-food exports to the EU, transport modes and Brexit By Lucile Henry; Ole Boysen
  14. Natural Resource Exports, Foreign Aid and Terrorism By Asongu, Simplice
  15. Implications of Firm Heterogeneity for Offshoring, Wage and Employment By Xi Chen
  16. From Immigrants to Americans: Race and Assimilation during the Great Migration By Fouka, Vasiliki; Mazumder, Soumyajit; Tabellini, Marco
  17. The Global Financial Resource Curse By Benigno, Gianluca; Fornaro, Luca; Wolf, Martin
  18. Possible carbon adjustment policies: An overview By Cecilia Bellora; Lionel Fontagné
  19. Escalation of trade conflicts and their impact on international trade in goods By Aliev, Timur (Алиев, Тимур); Flegontova, Tatiana (Флегонтова, Татьяна); Ponomareva, Olga (Пономарева, Ольга); Proka, Ksenia (Прока, Ксения); Pyzhikov, Nikita (Пыжиков, Никита)
  20. Exploring the trade (policy) narratives in economic elite discourse By Matthias Aistleitner; Stephan Puehringer
  21. Exploring the Impact of Economic Integration Agreements Through Extreme Bounds Analysis By Park, Byungyul; Beghin, John
  22. The world economy after the coronavirus shock: Restarting globalization? By Felbermayr, Gabriel (Ed.)
  23. Asia's emergence in global beverage markets: The rise of wine By Anderson, Kym
  24. Prospects for trade and economic cooperation of the Eurasian Economic Union (EAEU) with the South American common market (mercury) By Volovik, Nadezhda (Воловик, Надежда)
  25. The Rise and Fall of Import Substitution By Douglas A. Irwin
  26. Renewable Energy, Trade Performance and the Conditional Role of Finance and Institutional Capacity of sub-Sahara African Countries By Akinyemi, Opeyemi; Efobi, Uchenna; Asongu, Simplice; Osabuohein, Evans
  27. Global Smartphones Sales May Have Peaked By Joannes Mongardini; Aneta Radzikowski
  28. The Structure of Firms' International Activities By Davies, Ronald; Markusen, James R.
  29. Trade secrets law By Luigi Alberto Franzoni
  30. 25 Years of Austria's EU Membership. Quantifying the Economic Benefits With a DSGE Model By Fritz Breuss
  31. What impact does COVID-19 have on the Congolese economy and international trade? By Christian Pinshi
  32. On the Distributional Effects of International Tariffs By Daniel R. Carroll; Sewon Hur
  33. The Evolution of Deep Trade Agreements By Mattoo,Aaditya; Rocha,Nadia; Ruta,Michele
  34. Pandemics and protectionism: evidence from the "Spanish" flu By Sharp, Paul Richard; Pedersen, Maja Uhre; Lampe, Markus; Boberg-Fazlic, Nina
  35. Analysis of the contribution of the G20 countries to implementation trade and investment areas within the framework of the Goals sustainable development By Larionova, Marina (Ларионова, Марина); Sakharov, Andrey (Сахаров, Андрей); Kolmar, Olga (Колмар, Ольга)
  36. The US-China Trade War Impact on India and its Policy Choices By Rajesh Chadha; Sanjib Pohit; Devender Pratap
  37. Import Competition, Heterogeneous Preferences of Managers, and Productivity By Chen, Cheng; Steinwender, Claudia
  38. Across the Sea to Ireland: Return Atlantic Migration before the First World War By Alan Fernihough
  39. Exports and Productivity : The Role of Imported Inputs and Investment in R&D By Manghnani,Ruchita
  40. Global giants and local stars: How changes in brand ownership affect competition By Vanessa Alviarez; Keith Head; Thierry Mayer
  41. The Impact of Technology Level on Global Value Chain Formation By Tran Lam Anh Duong; Ivan Deseatnicov
  42. Opening Editorial: Multinational enterprises and business failures: A new research agenda. By Amankwah-Amoah, Joseph
  43. Product innovation and Export behaviour in French dairy industry By Kevin Randy Chemo Dzukou; Sabine Duvaleix-Treguer; Karine Latouche
  44. Brexit and External Differentiation in Single Market Access By Andreas Eisl; Eulalia Rubio
  45. The Impact of a Carbon Tax on Cross-Border Electricity Trading By Bowei Guo; David Newbery; Giorgio Castagneto Gissey
  46. Effect of migration on the food security of households left behind: Evidence from Ethiopia By Hamed Sambo
  47. Did Globalization Kill Contagion? By Accominotti, Olivier; Brière, Marie; Burietz, Aurore; Oosterlinck, Kim; Szafarz, Ariane
  48. Globalization Cycles By Obstfeld, Maurice

  1. By: Cappariello, Rita; Franco-Bedoya, Sebastian; Gunnella, Vanessa; Ottaviano, Gianmarco
    Abstract: Quantifying the effects of trade policy in the age of 'global value chains' (GVCs) requires an enhanced analytical framework that takes the observed international input-output relations in due account. However, existing quantitative general equilibrium models generally assume that industry-level bilateral final and intermediate trade shares are identical, and that the allocation of imported inputs across sectors is the same as the allocation of domestic inputs. This amounts to applying two proportionality assumptions, one at the border to split final goods and inputs, and another behind the border to allocate inputs across industries. In practice, neither assumption holds in available input-output data sets. To overcome this limitation of existing models, we consider a richer input-output structure across countries and sectors that we can match with the actual structure reported in input-output tables. This allows us to investigate the relation between the effects of changes in trade policies and GVCs. When we apply the enhanced quantitative general equilibrium model to the assessment of the effects of Brexit, we find trade and welfare losses that are substantially larger than those obtained by previous models. This is due to the close integration of UK-EU production networks and implies that denser GVCs amplify the adverse effects of protectionist trade policies.
    Keywords: Brexit; Supply Chains; Trade Model; Trade policy shocks
    JEL: F13 F15 F40 F60
    Date: 2020–02
  2. By: Mahdi Ghodsi
    Abstract: In the past few decades China has put substantial efforts into liberalising its trade and economy that accelerated after its accession to the World Trade Organisation (WTO) in December 2001. In this period China has significantly reduced its tariffs on manufacturing imports. However, the proliferation of nontariff measures (NTMs) imposed by China has made it the country notifying the second largest number of technical barriers to trade (TBTs) to the WTO after the United States. This paper investigates the impact of Chinese TBTs and tariffs on the imports of manufacturing products at the 6-digit level of the Harmonised System (HS) during 2002-2015. Heterogeneity of exporting firms, sample selection bias, multilateral resistances, and endogeneity bias are controlled for according to the recent strands of gravity modelling. Results suggest a positive impact of tariff reduction and the imposition of TBTs by China on its import values and quantities. The impact of Chinese TBTs is also differentiated across exporting countries. Since import prices are not significantly affected by TBTs, the imposed standards and regulations embedded in these trade policy measures allowed the economy to gain access to more products from the more developed economies, leading to trade creation.
    Keywords: World Trade Organisation, trade liberalisation, trade policy, technical barriers to trade
    JEL: F13 F14
    Date: 2018–10
  3. By: Francis Amoasah
    Abstract: The study considers the relationship between trade liberalization and economic growth among three sub-Saharan African countries: Ghana, Nigeria, and Cote d’Ivoire. We find no statistically significant increase in the economic growth of the countries following trade liberalization. However, post-trade-liberalization exports (and trade) of the countries did increase. Yet, the need for the promotion of exports in high value-added industries remain an age long unduly overdue problem. Increases in imports following liberalization dominate the increases in exports, export earnings remain susceptible to international price volatility and a chunk of the export commodities remain unprocessed as well as broadly narrow in range. The EU, US and China are the major trading partners to Africa, even more (in percentage terms) than the continent trades among itself. While reasonable efforts are being made on the African Continental Free Trade Area (AfCFTA), it should be seen that regional economic integration does not automatically improve growth. However, proper desegregation with the needed checks and balances may help yield for Africa some gains from trade. It is time, therefore, that the countries devise important measures to ensure that these envisaged significant gains from trade are duly realised.
    Keywords: trade liberalization, convergence, Sub-Saharan Africa
    JEL: F43 O10 C23 O40
    Date: 2018–12
  4. By: Harald Oberhofer; Michael Pfaffermayr
    Abstract: This paper proposes a new panel data structural gravity approach for estimating the trade and welfare effects of Brexit. The suggested Constrained Poisson Pseudo Maximum Likelihood Estimator exhibits some useful properties for trade policy analysis and allows to obtain estimates and confidence intervals which are consistent with structural trade theory. Assuming different counterfactual postBrexit scenarios, our main findings suggest that UKs (EUs) exports of goods to the EU (UK) are likely to decline within a range between 7.2% and 45.7% (5.9% and 38.2%) six years after the Brexit has taken place. For the UK, the negative trade effects are only partially offset by an increase in domestic goods trade and trade with third countries, inducing a decline in UKs real income between 1.4% and 5.7% under the hard Brexit scenario. The estimated welfare effects for the EU are negligible in magnitude and statistically not different from zero.
    Keywords: Constrained Poisson Pseudo Maximum Likelihood Estimation, Panel Data, International Trade, Structural Gravity Estimation, Trade Policy, Brexit
    JEL: F10 F15 C13 C50
    Date: 2018–10
  5. By: Bown, Chad P.; Erbahar, Aksel; Zanardi, Maurizio
    Abstract: This paper examines how trade protection is affected by changes in the value-added content of production arising through global value chains (GVCs). Exploiting a new set of WTO rules adopted in 1995 that impose an exogenously-timed requirement for countries to re-evaluate their previously-imposed trade protection, we adopt an instrumental variables strategy and identify the causal effect of GVC integration on the likelihood that a trade barrier is removed. Using a newly constructed dataset of protection removal decisions involving 10 countries, 41 trading partners, and 18 industries over 1995-2013, we find that bilateral, industry-specific domestic value-added growth in foreign production significantly raises the probability of removing a duty. The results are not limited to imports from China but are only found for the protection decisions of high-income countries. Back-of-the-envelope calculations indicate that rapid GVC growth in the 2000s freed almost a third of the trade flows subject to the most common temporary restrictions (i.e., antidumping) applied by high-income countries in 2006.
    Keywords: antidumping; global value chains; tariffs; trade liberalization; WTO
    JEL: F13
    Date: 2020–02
  6. By: Lodefalk, Magnus (Örebro University); Sjöholm, Fredrik (Lund University); Tang, Aili (Örebro University)
    Abstract: We examine if international trade improves labor market integration of immigrants in Sweden. Immigrants participate substantially less than natives in the labor market. However, trading with a foreign country is expected to increase the demand for immigrants from that country. By hiring immigrants, a firm may access foreign knowledge and networks needed to overcome information frictions in trade. Using granular longitudinal matched employer-employee data and an instrumental variable approach, we estimate the causal effects of a firm’s bilateral trade on employment and wages of immigrants from that country. We find a positive, yet heterogeneous, effect of trade on immigrant employment but no effect on immigrant wages.
    Keywords: Export; Import; Immigrants; Employment; Wages
    JEL: F16 F22 J21 J31 J61
    Date: 2020–06–17
  7. By: Ornella Tarola (University of Rome La Sapienza); skerdilajda Zanaj (Department of Economics and Management, Université du Luxembourg)
    Abstract: We define a model of international trade with two countries, two vertically differentiated goods, and heterogeneous consumers in terms of their willingness to pay for quality. Trade generates two sources of pollution: the production of domestic and traded goods and the transportation of goods between the two countries. Consumers in both countries manifest home bias, which translates into ethnocentric preferences: (i) consumers perceive the quality of the domestic good as amplified, and (ii) consumers derive additional satisfaction when consuming a domestic good rather than a foreign one since only the former can satisfy their sense of place; in contrast, they suffer a psychological penalty when consuming a foreign product. We investigate the role of trade costs and ethnocentrism in shaping the equilibrium configuration of the international duopoly. Finally, we uncover the environmental damage from production and from transport in the presence of ethnocentrism.
    Keywords: ethnocentrism, international trade, environmental damage, relative preferences, vertically differentiated mode.
    JEL: D43 F10 F15 Q56
    Date: 2020
  8. By: Kohnert, Dirk
    Abstract: ABSTRACT & RÉSUMÉ: Despite the Corona crisis, London is pushing ahead with the implementation of Brexit. This will have a profound impact not only on the EU but also on Africa. The British government's vision of a reinvigorated 'Global Britain' relies heavily on a reinforced cooperation with Commonwealth Sub-Saharan Africa. Already the temporary closure of manufacturing supply chains between China and the rest of the world because of the pandemic seriously affected economic activity in GB and the EU. However, African commodity exporters such as Nigeria, South Africa, and Kenya will likely bear the brunt of both the direct and indirect effects of this weaker demand. This will add up to the economic effects of Brexit and the spread of Corona in Africa. Most likely the vulnerable and the poor in Africa's informal sector will have to suffer the most by both health hazards and the economic decline.
    Keywords: Brexit,Corona,Africa,UK,EU,South Africa,Nigeria,Kenya,Poverty,African Studies
    JEL: F13 F35 F54 F63 G15 I1 N17 N47 N67 O17 P16 Z13
    Date: 2020
  9. By: Guriev, Sergei; Papaioannou, Elias
    Abstract: We synthesize the literature on the recent rise of populism. First, we go over definitional aspects and present descriptive evidence on the increased support for populists in the past decades. Second, we discuss the role of secular economic factors related to the growth in cross-border trade and automation. Third, we review studies analyzing the role of the recent crisis, connect them to historical work looking at the Great Depression, and discuss likely mechanisms. Fourth, we discuss studies investigating non-economic determinants of populism, identity politics and cultural backlash. Fifth, we go over studies on the role of online media. Sixth, we go over works on the role of immigration and the refugee crisis that entail both economic and cultural consequences. Seventh, we discuss preliminary evidence on the implications of the recent rise of populism. We conclude outlining the scope for further theoretical and empirical research.
    Date: 2020–02
  10. By: Robert C. Feenstra; Chang Hong
    Abstract: In December 2019, the United States and China reached a Phase One trade agreement, under which China committed to purchase more imports from the United States: $12.5 billion more agricultural imports in 2020 and $19.5 billion more in 2021, as compared to 2017. We show that the most efficient way for China to increase its imports from the United States is to mimic the effect of an import subsidy. If China’s agricultural imports did not otherwise grow from their 2017 values, then the subsidies would need to be 42% and 59% to meet the 2020 and 2021 targets, respectively. These effective subsidies mean that China would divert agricultural imports away from other countries. We find that this trade diversion is especially strong for Australia and Canada, followed by Brazil, Indonesia, Malaysia, Thailand, and Vietnam.
    JEL: F14 F53 Q17
    Date: 2020–06
  11. By: Anderson, Kym; Wittwer, Glyn
    Abstract: This paper describes a new empirical model of the world's markets for alcoholic beverages and, to illustrate its usefulness, reports results from projections of those markets from 2016-18 to 2025 under various scenarios. It not only revises and updates a model of the world's wine markets (Wittwer, Berger and Anderson, 2003) but also adds beer and spirits so as to capture the substitutability of those beverages among consumers. The model has some of the features of an economywide computable general equilibrium model, with international trade linking the markets of its 44 countries and seven residual regions. It is used to simulate prospects for these markets by 2025 (business-as-usual), which points to Asia's rise. Then two alternative scenarios to 2025 are explored: one simulates the withdrawal of the United Kingdom from the European Union (EU); the other simulates the effects of the recent imposition of additional 25% tariffs on selected beverages imported by the United States from several EU member countries. Future applications of the model are discussed in the concluding section.
    Keywords: beer; Cge modeling; changes in beverage preferences; international trade in beverages; spirits; Wine
    JEL: C53 F11 F17 Q13
    Date: 2020–02
  12. By: Gabriel Felbermayr (Kiel Institute for the World Economy); Toshihiro Okubo (Faculty of Economics, Keio University)
    Abstract: This paper studies an individual's preference on trade liberalization using a Japanese household survey, the Keio Household Panel Survey. As a result, we show that preferences toward trade liberalization are affected by economic factors (income, gender, family, asset, and job status) as well as non-economic factors (non-cognitive factors and social stance). In addition, regional factors such as food consumption and open-mindedness also matter.
    Keywords: Household survey, Trade liberalization, non-cognitive factors, regional factors, compensation
    JEL: F13 F14
    Date: 2020–05–04
  13. By: Lucile Henry (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - INRA - Institut National de la Recherche Agronomique); Ole Boysen (UCD School of Agriculture and Food Science)
    Abstract: From UK land-bridge to sea route: Irish agri-food exports to the EU, transport modes and Brexit
    Keywords: Brexit,Land bridge,trade,Ireland-France,agrifood
    Date: 2019–09–12
  14. By: Asongu, Simplice
    Abstract: Linkages between foreign aid, terrorism and natural resource (fuel and iron ore) exports are investigated in this study. The focus is on 78 developing countries with data for the period 1984 to 2008. The generalised method of moment is employed as empirical strategy. Three main foreign aid variables are used for the analysis, namely: bilateral aid, multilateral aid and total aid. The corresponding terrorism variables employed are: domestic terrorism, transnational terrorism, unclear terrorism and total terrorism. The following findings are established. First, the criteria informing the validity of specifications corresponding to iron ore exports do not hold. Second, there is evidence of convergence in fuel exports. Third, whereas the unconditional impacts of aid dynamics are not significant, the unconditional impacts of terrorism dynamics are consistently positive on fuel exports. Fourth, the interaction between terrorism and aid dynamics consistently display negative signs, with corresponding modifying aid thresholds within respective ranges. Unexpected signs are elicited and policy implications discussed. Given the unexpected results, an extended analysis is performed in which net effects are computed. These net effects are constitutive of the unconditional effect from terrorism and the conditional impacts from the interaction between foreign aid and terrorism dynamics. Based on the extended analysis, bilateral aid and total aid modulate terrorism dynamics to induce net positive effects on fuel exports while multilateral aid moderates terrorism dynamics to engender negative net effects on fuel exports. The research improves extant knowledge on nexuses between resources, terrorism and foreign aid.
    Keywords: Foreign Aid; Exports; Natural Resources; Terrorism; Economic Development
    JEL: F23 F35 F40 O40 Q34
    Date: 2019–01
  15. By: Xi Chen
    Abstract: The received wisdom is that cheaper foreign inputs may replace tasks previously done by domestic labor, and cause displacement of workers at the home country. However, using the U.S. multinational enterprises data, the empirical evidence in this paper does not support the idea that the imported intermediate input from foreign affiliates necessarily substitutes the domestic labor force at the sector-level. In order to better elucidate the offshoring employment relationship, this paper develops a general equilibrium model with monopolistic competition and firm heterogeneity. The model features (i) a fair wage condition where firms pay a real wage that exceeds the market clearing level and varies with productivity; (ii) an open economy in which firms can move a part of their production process to foreign countries. This model allows us to examine how a production-side shock that changes firms' offshoring decision can influence the local economy and its labor market.
    Keywords: Heterogeneous firms, productivity, offshoring, fair wage, employment
    JEL: D21 D24 F12 F16 F66
    Date: 2018–12
  16. By: Fouka, Vasiliki; Mazumder, Soumyajit; Tabellini, Marco
    Abstract: How does the appearance of a new immigrant group affect the integration of earlier generations of migrants? 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 northern urban centers, where 30 million Europeans had arrived since 1850. We exploit plausibly exogenous variation induced by the interaction between 1900 settlements of southern-born blacks in northern cities and state-level out-migration 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 culturally closer to native whites (i.e. Western and Northern Europeans). We show that these patterns cannot be entirely explained by economic forces. Our findings are instead more consistent with a framework in which changing perceptions of outgroup distance among the majority group lower the barriers to the assimilation of less distant minorities.
    Keywords: Assimilation; Great Migration; group identity; Immigration; race
    JEL: J11 J15 N32
    Date: 2020–02
  17. By: Benigno, Gianluca; Fornaro, Luca; Wolf, Martin
    Abstract: Since the late 1990s, the United States have received large capital flows from developing countries and experienced a productivity growth slowdown. Motivated by these facts, we provide a model connecting international financial integration and global productivity growth. The key feature is that the tradable sector is the engine of growth of the economy. Capital flows from developing countries to the United States boost demand for U.S. non-tradable goods. This induces a reallocation of U.S. economic activity from the tradable sector to the non-tradable one. In turn, lower profits in the tradable sector lead firms to cut back investment in innovation. Since innovation in the United States determines the evolution of the world technological frontier, the result is a drop in global productivity growth. We dub this effect the global financial resource curse. The model thus offers a new perspective on the consequences of financial globalization, and on the appropriate policy interventions to manage it.
    Keywords: Bretton Woods II; Capital Flows; export-led growth; global productivity growth; International financial integration; low global interest rates; U.S. productivity growth slowdown
    JEL: E44 F21 F41 F43 F62 O24 O31
    Date: 2020–02
  18. By: Cecilia Bellora; Lionel Fontagné (CES - Centre d'économie de la Sorbonne - CNRS - Centre National de la Recherche Scientifique - UP1 - Université Panthéon-Sorbonne)
    Abstract: The new European Commission has announced policies to reduce greenhouse gas emissions drastically. Reaching an ambitious target for a global good – the climate – would require a common price for carbon worldwide. This however clashes with the free-riding problem. Furthermore, unilateral policies are not efficient since they lead to carbon leakages and distort competitiveness. To tackle these issues, the European Union can rely on different policies. Firstly, a carbon pricing of imports can combined with an export rebate to constitute a ‘complete CBA' (Carbon Border Adjustment) solution. Alternatively, a simple tariff at the border can compensate for differences in carbon prices between domestic and imported products. A consumption-based carbon taxation can al so be contemplated. Last, a uniform tariff on imports from countries not imposing (equivalent) carbon policies may help solving the free-riding problem.
    Keywords: Carbon Border Adjustment,Climate Change,International Trade,Tariffs
    Date: 2020–04–14
  19. By: Aliev, Timur (Алиев, Тимур) (The Russian Presidential Academy of National Economy and Public Administration); Flegontova, Tatiana (Флегонтова, Татьяна) (The Russian Presidential Academy of National Economy and Public Administration); Ponomareva, Olga (Пономарева, Ольга) (The Russian Presidential Academy of National Economy and Public Administration); Proka, Ksenia (Прока, Ксения) (The Russian Presidential Academy of National Economy and Public Administration); Pyzhikov, Nikita (Пыжиков, Никита) (The Russian Presidential Academy of National Economy and Public Administration)
    Abstract: In this paper, the authors investigate the factors behind the emergence and escalation of trade conflicts since 2017. Both direct and indirect effects of the growth of protectionist measures caused by so-called "trade wars" are considered. The authors pay special attention to the problem of growing economic uncertainty associated, among other things, with a surge in protectionist sentiment. The authors provide a number of examples when rising economic uncertainty could, among other factors, influence companies' decision to move production from China. In an attempt to establish a causal relationship between economic uncertainty and international commodity flows, the gravity equation approach was used, with economic uncertainty introduced as one of the most interesting variables.
    Date: 2020–04
  20. By: Matthias Aistleitner (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria); Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)
    Abstract: Trade liberalization during the neoliberal era since the 1980s has been on the political agenda of many countries. However, in recent years and especially in the course of rising populist movements, protectionist measures seem to be gaining importance again. Nationalist economic policies challenge the overly positive view on economic integration and the reduction of trade barriers established by standard economic theory. In contrast to politicians, for quite a long time the great majority of economists explicitly publicly supported trade liberalization policies. In this paper, we show how trade and trade related policies are addressed and framed in professional economic discourses. Thus, we follow a mixed-method-approach and combine quantitative textual analysis with critical discourse analysis to highlight dominant narratives and imaginaries present in these debates. By analyzing more than 400 trade-related research articles published in high-impact economic journals we highlight three core trade narratives which constitute the elite economists trade discourse: First, “free trade cheerleading†describes a clear link between the alleged lopsidedness of economists in favoring free trade (policies) in the public and academic debate. Second, “Ignorance in a world full of nails†relates to particular methodological and conceptual leanings in the profession, which seem to deepen the dominance of an overall positive evaluation of trade. And third, “success breeds exporting breeds success†postulates a positive causal relation between a firm’s economic performance and its export orientation. We conclude that the narrow perspective in economic elite debates prevents a more comprehensive understanding of the multifaceted challenges related to international integration.
    Keywords: trade narratives, trade policies, discourse analysis, sociology of economics, textual analysis, top economic journals
    Date: 2020–06
  21. By: Park, Byungyul; Beghin, John
    Abstract: This paper provides an empirical strategy guided by the data to estimate the long-term effect of Economic Integration Agreements (EIAs) on trade flows. The strategy uses Extreme Bounds Analysis (EBA) to guide the choice of lags and leads in the effects, the periodicity of time intervals if any, and starting year and associated data exclusions. We show that arbitrarily selected intervals and the starting year can result in non-robust estimates of the long-term effect of EIAs on trade flows. The empirical strategy follows two steps: EBA firstly sifts lags and leads of EIAs robustly related with trade flows from candidates and then these are in turn included in the gravity equation to estimate the long-term aggregate effect of EIAs on trade. We find that various lags and one lead are robustly and positively related to trade flows, leading to the long-term effect of 64%. The long-term estimate obtained from EBA-based estimation has a larger contemporaneous effect and smaller lagged effects compared to previous studies relying on subjective choices of lags and leads and periodicity.
    Keywords: International Relations/Trade, Research Methods/ Statistical Methods
    Date: 2020–06–28
  22. By: Felbermayr, Gabriel (Ed.)
    Abstract: The COVID-19 virus has spread to 215 countries, virtually covering all areas of the world, and has plunged the world in a health emergency. The virus and the infection control measures by governments have an enormous, worldwide economic impact: when countries are connected by trade in goods, when a lockdown closes factories in one place of the world, essential inputs go missing in other places. And when a corona-induced recession hits one country, or when that area closes its borders for precautionary reasons, sales of goods or receipts from tourism by other countries go down, driving them into an economic crisis even when their own infection rates may be low. In this volume, edited by Gabriel Felbermayr, researchers from the Kiel Institute and from outside the institute provide answers to the pressing questions: How does the crisis change our world? Will there be lasting effects on our economies and on our societies at large? What does this mean for the worldwide living conditions? In this volume, they shed light on these questions from various angles, but always maintaining the global perspective.
    Date: 2020
  23. By: Anderson, Kym
    Abstract: Asia's alcohol consumption, and its retail expenditure on each of beer, distilled spirits and grape wine, have more than doubled so far this century. In the process, the mix of beverages in Asia's consumption of alcohol has been converging on that of the west as wine's share rises. Since Asia's beverage production has not kept up with its expansion in demand, imports net of exports are increasingly filling the gap - especially for wine. This paper analyses trends in consumption and imports for the region and key Asian countries, and provides projections to 2025 using a new model of global beverage markets.
    Keywords: beverage market projections; Changes in beverage tastes; impacts of tax and trade policies; premiumization of alcohol consumption
    JEL: F14 F17 L66 Q13
    Date: 2020–02
  24. By: Volovik, Nadezhda (Воловик, Надежда) (The Russian Presidential Academy of National Economy and Public Administration)
    Abstract: Based on a detailed study of the regulatory framework of Mercosur, as well as working documents of its bodies, an analysis of key aspects of the development of the Mercosur integration model is carried out, the main integration principles and their dynamics are identified. An analysis of the applied instruments of trade policy was carried out, which allowed to assess the degree of liberalization of foreign trade, unification of legislation in the field of customs and foreign trade policy between the countries of this regional association and their partners under the concluded Agreements on free trade zones.
    Date: 2020–04
  25. By: Douglas A. Irwin (Peterson Institute for International Economics)
    Abstract: In the 1950s, many economists believed that import substitution—policies to restrict imports of manufactured goods—was the best trade strategy to promote industrialization and economic growth in developing countries. By the mid-1960s, however, there was widespread disenchantment with the results of such a policy, even among its proponents. This paper traces the rise and fall of import substitution as a development idea. Perhaps surprisingly, early advocates of import substitution were quite cautious in their support for the policy and were also among the first to question it based on evidence derived from country experiences.
    Keywords: import substitution, industrialization, export promotion
    JEL: F13 O24
    Date: 2020–07
  26. By: Akinyemi, Opeyemi; Efobi, Uchenna; Asongu, Simplice; Osabuohein, Evans
    Abstract: The paper investigates the dynamic relationship between renewable energy usage and trade performance in sub-Saharan Africa (SSA), while considering the conditioning role of corruption control, regulatory quality, and the private sector access to finance. Focusing on 42 SSA countries for the period 2004-2016, and engaging the System generalized method of moments (GMM) technique for its estimation, this study found a negative relationship between renewable energy usage and the indicators of trade performance. However, with corruption control, improved regulatory framework, and better finance for the private sector, there are potentials for a positive net impact of renewable energy usage on manufacturing export. For renewable energy and total trade nexus, we find that improved regulatory framework and better finance for the private sector are important conditioning structures. These findings are significant because they highlight the different important structures of SSA countries that improve the effect of renewable energy use on trade outcomes. For instance, the consideration of the financial, institutional and regulatory frameworks in SSA countries in conditioning the renewable energy-trade nexus stipulates a clear policy pathway for countries in this region as the debate for transition to the use of renewable energy progresses.
    Keywords: Environment; Green growth; Trade performance; Pollution; Renewable energy; sub-Saharan Africa
    JEL: C50 F1 Q40 Q5
    Date: 2019–01
  27. By: Joannes Mongardini; Aneta Radzikowski
    Abstract: Global smartphone sales may have peaked. After reaching nearly 1.5 billion units in 2016, global smartphone sales have since declined, contributing negatively to world trade in 2019 and suggesting that the global market may now be saturated. This paper develops a simple model to forecast smartphone sales, which shows that sales are likely to decline further. As tech companies shift to embedded services (cloud computing, content subscriptions, and financial services), the impact on global trade may also be shifting in favor of services exports mostly from advanced economies.
    Date: 2020–05–29
  28. By: Davies, Ronald; Markusen, James R.
    Abstract: The structure of a multinational firm, that is how its affiliates relate to one another, is critical for understanding where multinationals locate, how policy affects them, and their resilience to localized shocks. Here, we review the two main structures: horizontal investments which replicate activities across borders, and vertical investments which fragment activities across countries. In addition, we use data (primarily from the US) to examine which of these structures seems to dominate the data. This includes a novel use of measures of global value-chain positioning of a country's industries. In each case, the data suggests a dominant role for horizontal investment. We conclude with a discussion of the challenge that intangibles play in multinational data and point towards potentially fertile areas for future research.
    Keywords: fragmentation; horizontal multinationals; replication; vertical multinationals
    JEL: F23
    Date: 2020–02
  29. By: Luigi Alberto Franzoni
    Abstract: The standardisation of trade secret protection was one of the goals of the TRIPs Agreement of 1998. Nevertheless, substantial differences in this protection remain across jurisdictions. When defining the optimal scope of trade secrets law, lawmakers should be aware that strong trade secret protection is likely to promote inventiveness, but it is also likely to hinder the diffusion of knowledge and prevent competition.
    JEL: K0 L1
    Date: 2020–06
  30. By: Fritz Breuss
    Abstract: Austria's EU accession 25 years ago, alongside Finland and Sweden, was preceded by an extended period of convergence toward the EU: via the free trade agreement concluded with the EC in 1973, and the participation in the European Economic Area (EEA) in 1994. Although the COVID-19 crisis in 2020 seems to overshadow the overall positive balance of 25 years of EU membership, on average the real GDP growth dividend amounted to 0.8 percentage points per year since 1995. To check the robustness of this result, obtained with an integration macro model, a DSGE model for Austria is used here. Usually other methods are applied to estimate integration effects: trade gravity models, CGE models, macro models. Following in't Veld's (2019) approach with a DSGE model for the EU, we adapt an earlier version of the two-country DSGE model for Austria and the Euro area (Breuss and Rabitsch, 2009) to evaluate the benefits of Austria's EU membership. It turns out that grosso modo the macro results can be confirmed with the DSGE model.
    Keywords: European Integration; Model simulations; country studies
    Date: 2020–06–26
  31. By: Christian Pinshi (UNIKIN - University of Kinshasa)
    Abstract: COVID-19 is spreading at a rate that could cause fear for international trade. In the past three months, the total number of confirmed cases has increased. The virus has confined more than half of the planet, contaminating the functioning of industries, dysfunctioning infrastructure at the national level, such as health care, transport, commerce and public services. The slowdown in production in China has had effects worldwide, reflecting China's growing importance in global supply chains and in commodity markets. The Democratic Republic of the Congo (DRC), where foreign trade represents on average 60% of its economy, is severely affected by this pandemic. The economy is in recession, prices continue to climb, the value of the currency continues to depreciate and leads to a loss of confidence.
    Keywords: COVID-19,International trade,economic growth
    Date: 2020–06–11
  32. By: Daniel R. Carroll; Sewon Hur
    Abstract: What are the distributional consequences of tariffs? We build a trade model with incomplete asset markets and households that are heterogeneous in their income, wealth, and labor skill. We increase tariffs by 5 percentage points and examine several budget-neutral fiscal policies for redistributing tariff revenue. Without redistribution, tariffs hurt all households, but higher tradables prices disproportionately harm the poor and the ensuing decline in the skill premium disproportionately harms the skilled. With redistribution, lowering the labor income tax leads to lower economic activity but higher average welfare relative to lowering the capital income tax; nevertheless, both policies reduce average welfare with retaliatory tariffs. Finally, when tariff revenue is rebated to households as lump-sum transfers, tariffs can be welfare improving even with full retaliation.
    Keywords: tariffs; consumption; taxation; inequality; welfare
    JEL: E21 F10 F62 H21
    Date: 2020–06–22
  33. By: Mattoo,Aaditya; Rocha,Nadia; Ruta,Michele
    Abstract: This paper presents new data on the content of preferential trade agreements. The data contain detailed information on the 18 policy areas most frequently covered in preferential trade agreements, focusing on the stated objectives, substantive commitments, and other aspects such as transparency, procedures, and enforcement. Several new stylized facts emerge: (i) preferential trade agreements have reduced trade-weighted average tariff rates to less than 5 percent for more than two-thirds of countries; (ii) the number of commitments in preferential trade agreements has increased over time, particularly since the 2000s and in areas aiming at facilitating flows of services, goods, and capital; (iii) deepening commitments have been accompanied by an increase in regulatory requirements, namely on enforcement; (iv) developing countries tend to have fewer commitments in preferential trade agreements, with larger gaps in areas such as labor and the environment; and (v) preferential trade agreements are more similar within blocs, but similarity can be significant even across blocs. The paper also discusses the challenges of quantification of preferential trade agreements"depth"and its effects and proposes a research agenda for future work on trade agreements.
    Date: 2020–06–16
  34. By: Sharp, Paul Richard; Pedersen, Maja Uhre; Lampe, Markus; Boberg-Fazlic, Nina
    Abstract: The impact of COVID-19 on recent tendencies towards international isolationism has been much speculated on but remains to be seen. We suggest that valuable evidence can be gleaned from the "Spanish" flu of 1918-20. It is well-known that the world fell into a protectionist spiral following the First World War, but scholars have almost exclusively ignored the impact of the pandemic. We employ a difference-in-differences strategy on data for Europe and find that excess deaths had a significant impact on trade policy, independent of the war. A one standard deviation increase in excess deaths during the outbreak implied 0.022 percentage points higher tariffs subsequently, corresponding to an increase of one third of a standard deviation in tariffs. Health policy should aim to avoid the experience of the interwar period and consider the international macroeconomic impact of measures (not) taken.
    Keywords: Trade; Protectionism; Pandemics
    JEL: N74 I19 F13
    Date: 2020–07–03
  35. By: Larionova, Marina (Ларионова, Марина) (The Russian Presidential Academy of National Economy and Public Administration); Sakharov, Andrey (Сахаров, Андрей) (The Russian Presidential Academy of National Economy and Public Administration); Kolmar, Olga (Колмар, Ольга) (The Russian Presidential Academy of National Economy and Public Administration)
    Abstract: Since the adoption of the Sustainable Development Goals by the UN in 2015 the G20 has repeatedly expressed its commitment to their implementation. The results of the study revealed the main areas in which the G20 contributes to the implementation of the trade and investment targets of the SDGs. At the same time, the factors hindering the implementation of the SDG trade and investment objectives by the G20 members were identified: A comparative analysis of the contribution of trade policies of the G20 members to the development of the trade and economic potential of the least developed countries revealed that a significant share of exports of the least developed countries (26.3% in the period 2015-2017) is affected by the protectionist measures of the G20 members. It was also established that the most potential harm to the export potential of the least developed partner countries was caused by the protectionist measures of the following G20 members: China (47.94 billion US dollars), USA (24.64 billion US dollars), EU (11.19 billion US dollars), Brazil (11.02 billion US dollars) and India (6.07 billion US dollars).
    Date: 2020–04
  36. By: Rajesh Chadha; Sanjib Pohit; Devender Pratap (National Council of Applied Economic Research)
    Abstract: The five-year period 2012-13 to 2016-17 witnessed a decline in Indian merchandise exports at an average rate of 4.5 percent per annum. The Ministry of Commerce and Industry initiated a discussion in August 2018 on designing a strategy for doubling India’s exports by 2025. This growth from US$ 504 billion exports of goods and services in 2017-18 to above US$ 1,000 billion in 2025-26 would imply an underlying growth rate of exports of above 9 percent per annum. While merchandise exports constitute close to 63 percent of total exports, the share of service exports has been 37 percent during the last three years, 2015-16 to 2017-18. Assuming these proportions remain unchanged, a doubling of merchandise exports in six years would mean going from the base 2017-18 level of US$ 309 billion to about US$ 618 billion by 2025-26, and service exports going from US$ 195 billion to US$ 390 billion. These are challenging targets. They raise the question of whether there are unexplored strategic opportunities in the current global trade situation, including in the looming US-China trade war, which can help India either achieve these targets or at least ensure that there are no significant reversals on the path to achieving them. This NCAER paper reflects on how India should react to the trade tensions between the world’s two largest economies.
    Keywords: Trade, Internationational Trade, Bi-lateral Trade, US China Trade War
    Date: 2019–11
  37. By: Chen, Cheng; Steinwender, Claudia
    Abstract: When managers have objectives beyond maximizing monetary profits, inefficiencies may arise. An increase in competition may then force managers to improve the productivity of the firm in order to ensure survival. While this hypothesis has received ample theoretical attention, empirical evidence is scarce, mainly because preferences of managers are typically unobserved. In this paper, we exploit the fact that a large literature has documented specific non-monetary preferences of family managers. Using Spanish firm-level data, we compare how family-managed and professionally-managed firms react to import competition shocks. We find that import competition leads to productivity increases in family-managed firms that are initially unproductive. Productivity improvements are driven by family management as opposed to family ownership or non-managing family members. Furthermore, we show that these managers increase efficiency by reducing material usage, which is consistent with them trying to increase their short-term cash flow in order to survive. Finally, productivity improvements seem to be particularly pronounced in multi-generational family firms that also introduce organizational changes.
    Keywords: family firms; import competition; Managers; productivity
    JEL: D22 D23 F14 L21 L22
    Date: 2020–01
  38. By: Alan Fernihough
    Abstract: Are return migrants 'losers' who fail to adapt to the challenges of the host economy, and thereby exacerbate the brain drain linked to emigration? Or are they 'winners' whose return enhances the human and physical capital of the home country? These questions are the subject of a burgeoning literature. This paper analyzes a new database culled from the 1911 Irish population census to address these issues for returnees to Ireland from North America more than a century ago. The evidence suggests that those who returned had the edge over the population as a whole in terms of human capital, if not also over those who remained abroad.
    Keywords: Migration; Brain gain; Economic history; Ireland
    JEL: N N33 J61
    Date: 2019–11
  39. By: Manghnani,Ruchita
    Abstract: The empirical evidence on within firm productivity improvements from exports has largely been understated because the measures of revenue productivity used do not account for pricing heterogeneity across firms. Using a panel of Indian firms, the analysis in this paper controls for firm variation in prices and uses proxy methods to retrieve measures of productivity that reflect physical productivity. Within-firm productivity changes from export entry are computed using a difference-in-differences matching estimator. The findings show that, over a six-year period, the difference in productivity growth between export entrants and their non-exporter counterparts is about 11 percentage points. Thus, productivity improvements from selling in international markets have largely been understated in the export-productivity empirical literature. This difference in productivity growth is decomposed into two channels. About 15 percent of the difference in productivity growth is explained by higher imports of intermediate inputs, and about 85 percent is explained by investment in research and development. The evidence suggests that investment in research and development is an important source of within-firm productivity gains even in developing countries.
    Date: 2020–06–16
  40. By: Vanessa Alviarez (Sauder School of Business (Columbia University) (Sauder)); Keith Head (Sauder School of Business (Columbia University)); Thierry Mayer (Département d'économie)
    Abstract: We assess the consequences for consumers in 76 countries of multinational acquisitions in beer and spirits. Outcomes depend on how changes in ownership affect markups versus efficiency. We find that owner fixed effects contribute very little to the performance of brands. On average, foreign ownership tends to raise costs and lower appeal. Using the estimated model, we simulate the consequences of counterfactual national merger regulation. The US beer price index would have been 4–7% higher without divestitures. Up to 30% savings could have been obtained in Latin America by emulating the pro-competition policies of the US and EU.
    Date: 2020–04
  41. By: Tran Lam Anh Duong; Ivan Deseatnicov
    Abstract: In this paper, we theoretically investigate the role of technology level in Global Value Chain (GVC) formation from two aspects: position and participation volume. We develop a simple two-country model where countries are heterogeneous with respect to their technology level and labor force. In GVC, there are a number of intermediate production stages with different technology thresholds. A country can produce at a stage if its technology level is higher than the stage's threshold. The unit labor requirement of a country in each stage is assumed to be inversely proportional to the difference between the technology level of the country and the technology threshold of the stage. According to this framework, the country with higher technology level will be producing at the stage with higher technology threshold. In contrast to previous studies that emphasize countries’ position in GVC only, our work focuses on both the “position†and “volume†of participation. We find that GVC participation volume of a country, measured in terms of the number of production stages it holds, will increase if there is an increase in either the country’s technology level or labor force.
    Keywords: Global Value Chain, technology level, spider-like structure
    JEL: F12 F15 O33
    Date: 2019–03
  42. By: Amankwah-Amoah, Joseph
    Abstract: This editorial advance a new research agenda on studying international business failures and failures of multinational enterprises’ subsidiaries to help in enriching understanding of strategy. By learning from the constraints and liabilities that make such firms vulnerable to market competition, organizations would be better positioned to develop resilient business models, capacity and expertise needed to decrease the risk of failure. This source of learning is not only essential in helping to enhance the market competitiveness of domestic firms but also helping them to transform into MNEs.
    Keywords: failure; international business failures; multinationals; blunders; collapse
    JEL: M0
    Date: 2019–12–06
  43. By: Kevin Randy Chemo Dzukou (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - INRA - Institut National de la Recherche Agronomique); Sabine Duvaleix-Treguer (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - INRA - Institut National de la Recherche Agronomique); Karine Latouche (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - INRA - Institut National de la Recherche Agronomique)
    Abstract: In this article, we are speci cally interested in product innovation as one potential driver of competitiveness. More precisely, we examine the relationship be- tween product innovation (seen as a way to reach quality di erentiation on foreign markets) and the export behaviour at the rm-product level in a theoretical model and we propose to test the predictions of this model with an application to the French dairy industry. The main issue addressed is whether product innovation, i.e. quality- enhancing strategy, improves rms' export performance.We especially examine to what extend product innovation a ect the quantity sold and the price charged on foreign market. Based on a unique data set detailing innovation at the rm-product-country level in the French dairy sector, we test the predictions of the model. Accounting for the self-selection process highlighted in a preliminary analysis, our results show that the quantity sold and the prices charged by rms increase after the introduction of an innovation at the product level.
    Keywords: heterogeneous products within firms,incremental and soft innovation,export behaviour
    Date: 2019–12–09
  44. By: Andreas Eisl (Centre d'études européennes et de politique comparée); Eulalia Rubio
    Abstract: This policy brief develops two possible scenarios (closer vs. looser cooperation) of a future EU–UK economic relationship. After analysing how they fit into the existing EU landscape of external differentiation, it assesses these two scenarios in terms of effectiveness – defined as the capacity to reduce economic disruption – and their potential effects on the EU’s political unity. The paper concludes that the scenario of closer cooperation is superior in its capacity to minimise economic harm both for the UK and for the EU, and to provide a climate for long-term economic cooperation. Regarding the impact on EU cohesiveness, we contend that the biggest threat to its unity would be an “unbalanced” agreement providing a level of advantages not matched with a corresponding set of obligations. This could spark desires for more differentiation among EU member states and trigger third-country demands to renegotiate existing EU regimes of external differentiation.
    Date: 2020–06
  45. By: Bowei Guo (Faculty of Economics, University of Cambridge); David Newbery (Faculty of Economics, University of Cambridge); Giorgio Castagneto Gissey (University College London)
    Keywords: Carbon tax, Interconnectors, Cost-benefit analysis, M-GARCH
    JEL: Q48 F14 D61 C13
    Date: 2019–06
  46. By: Hamed Sambo (Université Sorbonne Paris Nord (USPN))
    Abstract: In most countries, migration is a common phenomenon that can have both positive and negative effects on the living conditions of households in the locality of origin. This paper offers new evidence concerning the effect of migration on the food security of households left behind. The evidence is provided for Ethiopia, a country where internal migration is more predominant, and where food insecurity is still acute. The analysis is based on the 2013/2014 and 2015/2016 Ethiopian Socioeconomic Surveys (ESS), which are both nationally representative. In order to address the self-selection bias of migration, the estimation strategy used relies on the Heckman two-stage estimate and several robustness tests. The result indicates that migration negatively affects household per capita calorie intake while it leads to an improvement of their dietary diversity. However, the overall result is more inclined towards a negative effect of migration on the food security of migrant households in Ethiopia. Policies aimed at improving food security in Ethiopia should therefore consider those households among the priority targets.
    Keywords: Migration; Food security; Households; Ethiopia
    JEL: I31 O15 O55 Q18 R23
    Date: 2020–06
  47. By: Accominotti, Olivier; Brière, Marie; Burietz, Aurore; Oosterlinck, Kim; Szafarz, Ariane
    Abstract: Does financial globalization lead to contagion? We scrutinize linkages between international stock markets in a long historical perspective (1880-2014). Our results highlight that without globalization, contagion cannot exist. However, if cross-market correlations are very high, globalization kills contagion. We show that financial contagion was absent from stock markets in both the period of deglobalization of 1918-1971 and the era of "extreme" globalization of 1972-2014 but was present in the period of "moderate" globalization of 1880-1914. Our results suggest that contagion could become a significant problem if financial markets return to a more moderate level of globalization.
    Keywords: contagion; economic integration; Financial history; Globalization; market interdependence; Stock market
    JEL: E44 F36 F65 G15 N20
    Date: 2020–02
  48. By: Obstfeld, Maurice
    Abstract: Mark Twain is reputed to have remarked that history does not repeat itself, but it often rhymes. While the Global Financial Crisis of 2008-2009 was not a catastrophe on the order of World War I, there is a broad similarity in the sequelae to both of these events â?? a failed attempt to return to pre-trauma normalcy, followed by a process of international economic disintegration in the face of changed geopolitical realities. In this essay, I explore three questions that this similarity raises. Does globalization inherently foster domestic or international dynamics that eventually lead to political backlash? If so, are these dynamics inevitable, or can complementary economic policies nurture a stable globalization? And finally, since policies are endogenous, when are policy approaches and institutions that complement and support globalization likely to arise?
    Keywords: deglobalization; Globalization
    JEL: F52 F53 F60 N20 N40
    Date: 2020–02

This nep-int issue is ©2020 by Luca Salvatici. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.