|
on International Trade |
| By: | Liu, Nan |
| Abstract: | From 2018 through 2019, the United States and China imposed a series of wide-ranging increases in import tariffs which have dramatically raised trade barriers between the two largest economies in the world. With a focus on the import side, this paper provides evidence on the impact of the trade war on China's trade quantities and prices, and estimates related trade elasticities. Both Chinese import quantities and values dropped sharply following the tariffs and there is evidence for incomplete pass-through of Chinese import tariffs in the very short run. More importantly, this paper shows that while China's non-processing imports declined dramatically during the trade war, the processing imports almost remain unaffected. The results suggest that the Chinese special duty-free policy on processing trade may have served as a built-in mechanism to better protect domestic firms from the damage of the trade war through the global value chain channel. |
| Keywords: | Trade war; Tariff; China; Processing trade; Global value chain |
| JEL: | F10 F13 F14 |
| Date: | 2020–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110175&r= |
| By: | Valera, Harold Glenn A.; Yamano, Takashi; Pede, Valerien O. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade, International Development |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea21:313904&r= |
| By: | Liu, Yangxuan; Liu, Jing; Adhikari, Shweta; Escalante, Cesar L. |
| Keywords: | International Relations/Trade, International Development, Agricultural and Food Policy |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea21:314024&r= |
| By: | Bouët, Antoine; Laborde Debucquet, David; Traore, Fousseini |
| Abstract: | MIRAGRODEP Dual-Dual is a recursive-dynamic multi-region, multi-sector computable general equilibrium model, devoted to trade and agricultural policy analysis. It is developed for AGRODEP and draws upon the MIRAGE model built by CEPII. It incorporates specific features of African economies. In addition to the usual dichotomy between rural and urban activities, it also features the distinction between formal and informal activities (double dualism a la Stifel-Thorbecke). The model includes other features such as foreign direct investment and runs with a tariff aggregation module that allows the user to capture the exclusion effects at a detailed level and the variance of tariffs. The model also includes a submodule allowing to test different closures for the public sector as well as the inefficiency of the tax collection system. Social Accounting Matrix (SAM) and trade data in MIRAGRODEP are based on the GTAP database. Additional sources such as MacMap are used for protection data. |
| Keywords: | EUROPE, AFRICA, AFRICA SOUTH OF SAHARA, CENTRAL AFRICA, EAST AFRICA, NORTH AFRICA, SOUTHERN AFRICA, WEST AFRICA, modelling, models, trade, agricultural policies, agriculture, tariffs, exports, economic agreements, European Union, MIRAGRODEP model, Social Accounting Matrix (SAM) |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:agrotn:tn-21&r= |
| By: | Evdokia Moïsé; Silvia Sorescu |
| Abstract: | Border processes for perishable agro-food products involve multiple agencies and raise complex compliance and enforcement issues. At the same time, the speed of border processes is of particular importance for exporters as delays at the border can have great negative impacts on the quality of perishable agro-food products and hence their value. This calls for a more detailed and nuanced look at the impact of trade facilitation reforms on agro-food trade. This report examines how a sub-set of OECD Trade Facilitation Indicators (TFIs) could be used to provide a more complete picture of the current performance of border processes for perishable agro-food goods. It highlights specific TFIs of relevance to agro-food, including: documentation requirements or border controls related to sanitary and phytosanitary measures and technical barriers to trade, and automation and streamlining of border formalities, and explores differentiated impacts across agro-food product groups. Practical approaches are identified to enrich the scope of the existing OECD TFIs with a view to deepening the information base on the performance of trade facilitation policies for perishable agro-food goods. |
| Keywords: | Agro-food trade, COVID-19, Simplification, Trade costs |
| JEL: | F13 F68 Q17 |
| Date: | 2021–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:oec:traaab:254-en&r= |
| By: | Ahmed, Osama; Glauben, Thomas; Heigermoser, Maximilian; Prehn, Sören |
| Abstract: | Income growth, changing consumer preferences and technological progress are having a transformative effect on global food trade and, in particular, wheat markets. This is evidenced by two main developments: First, the growing demand for wheat in Asia and Africa is increasingly being met by the European Union (EU) and the Black Sea Region (BSR), which have replaced the United States (US) as the major players on the global wheat market. Second, and as a consequence, the Euronext futures market, which reflects the supply and demand fundamentals in the EU and the BSR, is becoming more important for international wheat price discovery. In light of these two changes, the EU and the BSR must take more responsibility for ensuring global food security and combating hunger and malnutrition. To achieve this, greater international cooperation is required, in particular between the big Western and Eastern economic powers. Unrestricted international trade is vital to ensure sufficient supply of food worldwide, while escalating economic sanctions and countersanctions endanger food security, especially in import-dependent regions. Public debate on trade and economic sanctions must therefore be more objective and better take into ac- count both regional and global needs. |
| Keywords: | Food Security and Poverty, International Relations/Trade |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iamopb:314669&r= |
| By: | Gunnella, Vanessa; Lebastard, Laura; Lopez-Garcia, Paloma; Serafini, Roberta; Mattioli, Alessandro Zona |
| Abstract: | The consensus back in 2008 – ten years after the introduction of the euro – was that the adoption of a common currency had made a limited impact of around 2% in total on the trade flows of the first wave of euro area countries (Baldwin et al., 2008). Since then, six more countries have joined the euro area, and firms have internationalised their production processes. These two phenomena are interrelated and may have changed the way the common currency affects the euro area economy. Therefore, with the common currency now into its third decade – and with more countries queuing to adopt it – this paper revisits the trade effects of the euro, focusing on the newer euro adopters (i.e. those countries that have adopted the euro since 2007) and their interaction with the first wave of euro area members via supply chains. The contribution of the paper is twofold. First, it revisits the estimated aggregate impact of the euro on euro area trade, as well as on trade within and between the two waves of adopters. Data on bilateral flows between 1990 and 2015 for an extended sample of countries to estimate a gravity equation indicate a significant trade impact, ranging between 4.3% and 6.3% in total on average, with the magnitude being the highest for exports from the second wave of adopters to the first wave of adopters. If a synthetic control approach (Abadie and Gardeazabal, 2003; Abadie et al., 2010) is used instead, the estimated gains associated with euro adoption are greater. In particular, exports of both intermediate and final products from countries belonging to the first wave of euro adopters to those belonging to the second wave are estimated to have increased by about 30% using this approach. The second contribution made by this paper relates to the channels through which trade might be affected by a currency union. This question is explored by looking separately at trade in intermediate goods and final products. While we find that trade gains were mainly driven by trade in intermediate goods among countries that adopted the currency earlier (5.3%), our results also show that the euro had a positive effect on the exports of final products from the second wave of adopters to other euro area countries. This effect is as high as 10.6% with the gravity model and 32% with the synthetic control approach. One of the reasons for the difference in the range of estimates between the two approaches might be that the gravity model can control for unobserved characteristics via fixed effects, while the synthetic control approach may fail to do so. These results suggest that the euro facilitated the establishment and expansion of international production chains in Europe. In turn, this is likely to have increased business cycle synchronisation in the euro area and to have supported market access for later adopters. JEL Classification: F14, F15 |
| Keywords: | euro, global value chains, gravity equation, synthetic control approach, trade flows |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbops:2021283&r= |
| By: | Asongu, Simplice; Nchofoung, Tii |
| Abstract: | This study empirically verifies the effect of terrorism on financial development and how globalisation and governance modulate the incidence of terrorism on financial development in Africa. Two terrorism indicators are adopted for this study, namely, the: number of terrorism incidences and number of terrorism deaths. The methodology involves the pooled data technique running from 1996-2018 for 34 African countries. The results from the POLS, Driscoll-Kraay and the Newey-West standard error corrections show that terrorism is detrimental to financial development. From the interactive regressions, three major tendencies are apparent. First, terrorism dynamics consistently have an unconditional negative effect on financial development. Second, the globalization and government dynamics modulate the terrorism dynamics to broadly induce a negative net effect on financial development. Third, policy thresholds at which the modulating variables reverse the net effect on financial development from negative to positive are: (i) 71.61572 trade (% of GDP) and 13.97872 FDI (% of GDP) for the incidence of terror and (ii) 1.16201 trade (% of GDP) for terror deaths. The computed thresholds make economic sense and worthwhile in terms of policy implications because they are within statistical range. The result is robust to alternative measures of terrorism and financial development. Policy implications are discussed. |
| Keywords: | terrorism, financial development, globalisation, governance, Pooled data |
| JEL: | C52 D74 F65 G28 P37 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110130&r= |
| By: | Baldwin, Richard (The Graduate Institute, Geneva); Freeman, Rebecca (Bank of England) |
| Abstract: | Recent supply disruptions catapulted the issue of risk in global supply chains (GSCs) to the top of policy agendas and created the impression that shortages would have been less severe if GSCs were either shorter and more domestic, or more diversified. But is this right? We start our answer by reviewing studies that look at risks to and from GSCs, and how GSCs have recovered from past shocks. We then look at whether GSCs are too risky – starting with business research on how firms approach the cost-resiliency trade-off. We propose the risk-versus-reward framework from portfolio theory as a good way to evaluate whether anti-risk policy is justified. We then discuss how exposures to foreign shocks are measured and argue that exposure is higher than direct indicators imply. Finally, we consider the future of GSCs in light of current policy proposals and advancing technology before pointing to the rich menu of topics for future research on the risk-GSC nexus. |
| Keywords: | Risk; resilience; supply chains; global value chains; input reliance; globalization |
| JEL: | F10 F13 F14 F15 |
| Date: | 2021–09–24 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0942&r= |
| By: | Athanasios Kampas (Agricultural University of Athens); Katarzyna Czech (Department of Econometrics and Statistics, Institute of Economics and Finance, Warsaw University of Life Sciences); Stelios Rozakis (Technical University of Crete, Lab of Bioeconomy and Biosystems Economics, School of Environmental Engineering) |
| Abstract: | This paper examines the links between globalisation and environmental policy stringency with the environmental terms of trade. The existence of dynamic links among the variables were explored using cross-correlations and Granger Causality tests. According to the results, the de jure and the de facto globalisation measures have different environmental impacts. Also, despite the fact that all V4 countries have introduced strict environmental policies, especially since 2000, the relative strength of these policies lag behind the maximum OECD stringency. As a result, the pollution heaven hypothesis cannot be excluded. The policy implications of the results are briefly discussed. |
| Keywords: | Pollution Haven Hypothesis, Globalisation, Ecological Footprint of exports/ imports, Environmental Terms of Trade |
| JEL: | Q50 Q56 Q51 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:aua:wpaper:2021-1&r= |
| By: | Stephan Marette (ECO-PUB - Economie Publique - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - AgroParisTech); Anne-Célia Disdier (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Anastasia Bodnar (USDA - United States Department of Agriculture); John Beghin (University of Nebraska [Lincoln] - University of Nebraska System) |
| Abstract: | New Plant Engineering Techniques (NPETs) may significantly improve both production and quality of foods. Consumers and regulators around the world might be reluctant to accept such products, which may cripple adoption and global market penetration of these products. We develop a parsimonious economic model for R&D investment in food innovations to identify conditions under which NPET technology emerges in a context of international trade. The framework integrates consumers' willingness to pay (WTP) for the new food, the uncertainty of R&D processes, the associated regulatory cost of approval, and the competition between domestic and foreign products. With generic applicability, the model enables the quantitative analysis of new foods that could be introduced in markets and then traded across borders. We apply the framework to a hypothetical case of apples improved with NPETs. Simulation results suggest that import bans and high values of sunk costs can reduce R&D investment in NPETs to suboptimal levels. |
| Keywords: | new plant engineering techniques (NPETs),genome editing (GenEd),trade,willingness to pay (WTP),food innovation,industrial organization,apple,nontariff measure (NTM) |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-03359622&r= |
| By: | Heigermoser, Maximilian; Glauben, Thomas |
| Abstract: | The Covid-19 pandemic poses unprecedented challenges to the global economy. While aggregated agricultural trade patterns remained largely unaffected by the pandemic, the World Bank still expects global poverty to rise for the first time in more than twenty years. Since late 2020, several developments have the potential to further jeopardize global food security. Precisely, sea freight rates for bulk carriers, which are primarily used in international agricultural trade, have surged to an eleven-year high. However, despite the significant role that transportation costs play in international food trade, current research tends to overlook the impact they have on trade flows and food price formation. Further, the Food Price Index provided by the Food and Agriculture Organization of the United Nations (FAO) has increased for eleven straight months, reaching a seven-year high. These developments constitute increased risk to food security, particularly in poorer regions. Only strengthened international cooperation and unrestricted trade can safeguard global food security in the coming phase of globally uneven economic recovery. Calls for domestic self-sufficiency, proposals to transition to an over-bureaucratized, command-and-control EU-food system, as well as tightening economic sanctions and countersanctions between leading economic powers endanger food security, especially in import-dependent regions. |
| Keywords: | Food Security and Poverty, International Development, International Relations/Trade |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iamopb:314666&r= |
| By: | Kelvin Balcombe; Dylan Bradley; Iain Fraser |
| Abstract: | This research employs two alternatively framed but formally equivalent discrete choice experiments that examine UK consumer preferences regarding chlorine washed chicken. One is framed in a common purchase format, the other employs a format that endows respondents with a voucher that they can use to redeem for a chicken product, or exchange, in part, for an alternative chicken product or cash. We find that the difference in our value estimates is small regardless of how we implement our choice experiment. Our analysis also differentiates the value estimates by respondent attitude to Brexit. The results reveal that being positively disposed toward Brexit means that respondents are less likely to value chlorine washed chicken negatively. Yet, of equal or greater significance, those respondents who hold positive attitudes with regard to Brexit still value EU food safety standards and quality assurance schemes such as Red Tractor highly. This suggests that attitudes to Brexit and preferences regarding food do not necessarily align in support of trade agreements that may require the UK to lower existing food safety and animal welfare standards. Potential policy solutions to ensure consumer preferences are satisfied are discussed. |
| Keywords: | Chlorinated Chicken; Willingness to Pay; Discrete Choice Experiment; Brexit; Trade Policy; Red Tractor |
| JEL: | Q18 Q17 I18 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:2112&r= |
| By: | Gianluca Benigno; Luca Fornaro; Martin Wolf |
| Abstract: | Since the late 1990s, the United States has received large capital flows from developing countries - a phenomenon known as the global saving glut - 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, inducing 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. This effect, which we dub the global financial resource curse, can help explain why the global saving glut has been accompanied by subdued investment and growth, in spite of low global interest rates. |
| Keywords: | global saving glut, global productivity growth, international financial integration, capital flows, U.S. productivity growth slowdown, low global interest rates, Bretton Woods II, export-led growth |
| JEL: | E44 F21 F41 F43 F62 O24 O31 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1803&r= |
| By: | Kammas, Pantelis; Sakalis, Argyris; Sarantides, Vassilis |
| Abstract: | During the late 19th century, the increasing popularity of pudding in England, along with the outbreak of phylloxera plague in French vineyards had an unintended effect in the agrarian economy of Greece. In particular, these events escalated the international demand and production of currants in Greece during the 1870s, causing an unprecedented positive shock that was transmitted through trade in the agricultural population. Using novel data from historical archives, we explore how this exogenous event affected investment towards human capital. Consistent with expectations, in an agrarian economy that specializes in unskilled labour-intensive agricultural goods, this shock had a negative effect on human capital formation. |
| Keywords: | education; fertility; agriculture; international trad |
| JEL: | J24 N33 O15 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:112206&r= |
| By: | Luiz, Silveira L. A.; Paulo, Magalhaes |
| Keywords: | International Relations/Trade |
| Date: | 2021–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cantrf:314683&r= |
| By: | Ogundari, Kolawole |
| Abstract: | The paper examines the effect of trade on income inequality in sub-Saharan Africa (SSA) countries. We employ a balanced panel of 11 countries covering 1980-2008 and use a fractional regression model for panel data as a method of estimation. The empirical results show that trade decreases income inequality, which might be an indication that our findings support the Stolper-Samuelson (SS) theorem in the Heckscher-Ohlin (HO) model in SSA. We also found evidence that lack of democracy (i.e., the existence of autocracy) increases income inequality, while higher educational attainment decreases income inequality in the study |
| Keywords: | fractional regression, income inequality, education, political right, trade, SSA |
| JEL: | E1 E6 F1 F18 |
| Date: | 2021–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110200&r= |
| By: | Annelies Deuss; Csaba Gaspar; Marcel Bruins |
| Abstract: | Trade in seeds is key to guarantee access to food across the globe. COVID-19 led to concerns that seed supply chains would be disrupted and that countries relying on imported seed would not have sufficient supplies for the upcoming season. Focusing on the impact of COVID-19 from the perspective of seed companies and the formal seed sector, this study shows that the global seed sector was reasonably resilient during the crisis, although seed companies headquartered in the Asia Pacific region were more negatively affected than their counterparts in other regions. The two main bottlenecks were the availability of staff in the seed production chain and in government administrations, and the distribution of seed to farmers. Building a more resilient seed supply chain will require policies to ensure the uninterrupted production and movement of seed during lockdowns; the further development of international seed supply chains; and the diversification of seed production. Digitalisation could also improve the availability of information on seed production and trade, enabling faster government responses to disruptions. |
| Keywords: | Asia, Digitilisation, International supply chain, Vegetable seeds |
| JEL: | Q12 Q13 Q16 Q17 Q18 |
| Date: | 2021–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:oec:agraaa:168-en&r= |
| By: | Frey, Rainer; Goldbach, Stefan |
| Abstract: | In some countries around the world, the advantages of globalisation have been increasingly called into question recently. In particular, takeovers by foreign firms raise suspicions of technology theft and job cuts at the newly acquired local plant. By looking at Germany, as a large open economy, between 1999 and 2018 we first see that both German firms that are acquired by foreign investors and German firms which invest abroad show similar characteristics: they are on average larger, more innovative and productive, but less profitable than purely national firms. With internationalisation, a variety of positive effects emerge. With respect to takeovers of German companies by foreign investors, the productivity and sales of the German affiliate increase while the foreign owners tend to step up expenditure on the labour force in Germany in the aftermath of the acquisition - compared to purely domestically owned firms. In the case of German firms going international, we find positive productivity and sales effects for relatively small companies investing abroad, and this internationalisation is not to the detriment of the domestic labour force. Thus, all in all, this supports a positive view of globalisation. However not all firms benefit: in particular, sector, firm size and time horizon have a bearing on the outcome. |
| Keywords: | globalisation,firm acquisition,M&A,productivity,sales,innovativeness,know-how,technology,labour costs,employment,wages,firm heterogeneity |
| JEL: | D22 D24 F23 G34 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdps:332021&r= |
| By: | Harold D Chiang; Yukun Ma; Joel Rodrigue; Yuya Sasaki |
| Abstract: | This paper presents novel methods and theories for estimation and inference about parameters in econometric models using machine learning of nuisance parameters when data are dyadic. We propose a dyadic cross fitting method to remove over-fitting biases under arbitrary dyadic dependence. Together with the use of Neyman orthogonal scores, this novel cross fitting method enables root-$n$ consistent estimation and inference robustly against dyadic dependence. We illustrate an application of our general framework to high-dimensional network link formation models. With this method applied to empirical data of international economic networks, we reexamine determinants of free trade agreements (FTA) viewed as links formed in the dyad composed of world economies. We document that standard methods may lead to misleading conclusions for numerous classic determinants of FTA formation due to biased point estimates or standard errors which are too small. |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2110.04365&r= |
| By: | Elmallakh, Nelly; Wodon, Quentin |
| Abstract: | This paper investigates the effects of shocks, predominantly climate shocks, on labor market outcomes in the West African Economic and Monetary Union (WAEMU). We focus on migration ows within the WAEMU countries to disentangle the differential effects of shocks on migrants and non-migrants. Our analysis combines survey data from Ivory Coast|as the main migrant receiving country|and from all the other 7 migrant sending countries of the WAEMU. Using an OLS fixed effects model, our results show that migration in the WAEMU is associated with a decline in female labor participation, as it is primarily motivated by marriage. However, we find an increase in female labor force participation and a narrowing of the gender gap in migrant households that are negatively affected by shocks. Our findings relate to the literature on the impact of shocks on the labor division between women and men and show that shocks may disrupt long-standing gender roles. The results are robust to accounting for the double selection into shocks and migration using a Propensity Score Matching technique that allows for a within comparison between treated and untreated units. |
| Keywords: | shocks,migration,climate,employment,labor market,women,West Africa |
| JEL: | F22 J21 J43 J61 Q54 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:950&r= |
| By: | Aysan, Ahmet Faruk; Castillo-Téllez, Luis Carlos; Demirbaş, Dilek; Disli, Mustafa |
| Abstract: | This research analyses the innovative performance of 5273 companies across 64 different economic sectors and 32 different regions in Colombia. We assess the different effects on the innovative performance of firms by analyzing firm, sector, and regional level determinants. The study involves the multilevel approach of the innovation process considering the structure and behavior of innovation systems in developing countries. We furthermore focus on technology transfer from foreign trade and the role of education in the process of innovation. We find that education and open economy variables have a significant relationship with innovation performance at the firm and regional levels. |
| Keywords: | Multilevel, Innovative Performance, Open Economy Variables, Innovation Systems, Multilevel Regression Models, Development. |
| JEL: | A1 A2 O24 |
| Date: | 2021–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110021&r= |
| By: | Majumder, Rajarshi |
| Abstract: | Globalisation has been the buzzword across the world for a major part of the last 40 years or so. Starting at a creeping pace in the mid-1980s, it has advanced at unprecedented pace over the last two and half decades. Trade barriers have come down, linkages have been formed and strengthened, and a plethora of economic activities have become intertwined, across countries and continents giving rise to the global value chain. Technological advancements across the globe has reinforced globalisation. However, after a quarter of century, voices are being raised regarding inequalities and instabilities in the labour market. Against this backdrop, this paper attempts to explore global trends in the world of work and also examine how globalisation and technological changes have affected the labour market in different sets of countries over the last 25 years or so. Using Labour Market data from ILO, it has been shown that globalisation has been associated with a phenomenal rise in GDP coupled with low population growth & rising PCI in major parts of the globe in recent times. But this striking economic boom has not been reflected in the labour market, especially in the low and middle income countries, which now have Unemployment rates higher than what was in 1990, even though LFPR itself has declined. There has happened large scale adoption of labour saving technology across the globe, as a result of which expansion & improvement of employment has not been up to the expected level. Instead of industrialisation, share of industry in GDP has declined in the developing world accompanied by a tremendous increase in the share of services in GDP – a sure sign of Missing middle phase of economic transformation. Globalisation indices used here are found to be significantly negatively associated with employment growth rates all throughout. Magnitude of the negative relation is stronger for middle income countries than the high income countries – indicating that the post-globalisation shock to labour market has been higher in developing countries rather than in developed countries. It is time to pay heed to saner academic voices and give a boost to domestic demand through larger government expenditure, rather than stick to a neo-liberal supply side fetish in the developing economies. |
| Keywords: | Employment; Globalisation; Technology; Capital-Labour Ratio; Sectoral GDP; Employment Elasticity; Financial Integration |
| JEL: | F60 F62 F63 F66 J21 J23 J31 O14 O31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110077&r= |
| By: | Durst, Michael C. |
| Abstract: | This paper considers whether the ‘Amount B’ proposal currently being negotiated in the Inclusive Framework, for the attribution of fixed remuneration for the ‘routine’ distribution and marketing activities of MNE affiliates, may offer a useful template for the re-working of the widely used ‘transactional net margin’ transfer pricing method (TNMM). The TNMM has for years posed severe difficulties for tax administrations around the world, especially in developing countries. The paper focuses especially on two variants of the Amount B proposal which have been offered by Johnson & Johnson and Procter & Gamble, and suggests how a revised TNMM might be expanded to apply to MNE affiliates engaged in activities in addition to marketing and distribution. The paper acknowledges that a restructured TNMM would remain in some ways an imperfect tax administration instrument, and that its construction will involve some unavoidable technical challenges (as would be true of any meaningful reform of rules for the international division of profits for tax purposes). Nevertheless, a restructured TNMM could provide significant relief to hard-pressed developing-country tax administrations, and the paper argues that it should figure among the objectives of the OECD’s current efforts at international tax reform. |
| Keywords: | Development Policy, Economic Development, Finance, Globalisation, Governance, |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:15482&r= |
| By: | Bichler, Shimshon; Nitzan, Jonathan |
| Abstract: | In 2012, we published a paper in the Journal of Critical Globalization Studies titled 'Imperialism and Financialism: The Story of a Nexus'. Our topic was the chameleon-like Marxist notion of imperialism and how its different theories related to finance. Here is the article's summary: Over the past century, the nexus of imperialism and financialism has become a major axis of Marxist theory and praxis. Many Marxists consider this nexus to be a prime cause of our worldly ills, but the historical role they ascribe to it has changed dramatically over time. The key change concerns the nature and direction of surplus and liquidity flows. The first incarnation of the nexus, articulated at the turn of the twentieth century, explained the imperialist scramble for colonies to which finance capital could export its excessive surplus. The next version posited a neo-imperial world of monopoly capitalism where the core's surplus is absorbed domestically, sucked into a black hole of military spending and financial intermediation. The third script postulated a World System where surplus is imported from the dependent periphery into the financial core. And the most recent edition explains the hollowing out of the U.S. core, a red giant that has already burned much of its own productive fuel and is now trying to financialize the rest of the world in order to use the system's external liquidity. The paper outlines this chameleon-like transformation, assesses what is left of the nexus and asks whether it is worth keeping. (p. 42) In the second part of the paper, we looked a little closer at the red-giant argument. Specifically, we wanted to gauge the degree to which U.S. capital had declined and examine whether this decline indeed forced the rest of the world to financialize. And what we found surprised us: the 'financial sector' did seem to become more important everywhere, but its rise was led not by the United States, but by the rest of the world! Our article was published almost a decade ago, so we though it would be interesting to update our figures and see what has changed, if anything. |
| Keywords: | globalization,imperialism,financialization,United States |
| JEL: | P16 P26 P48 G3 F5 G1 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:243122&r= |
| By: | Malah, Yselle; Asongu, Simplice |
| Abstract: | The paper explores the dark side of economic openness by examining empirically the nexus between the globalization process and human trafficking. Specifically, it is about showing in a global perspective how the growing process of free movement of people, goods, capital, services and information technology make the globe a connected web of activity for the sale and exploitation of human beings. After discussing some transmission channels through which globalization could increase this practice based on the lessons from the literature, an empirical analysis is done by employing OLS and Probit regressions on a cross-sectional model covering 130 countries worldwide. Findings, robust to the consideration of the sub-regional specificities and controlling for social, cultural and historical factors, suggest that globalization, particularly financial and cultural, favors human trafficking. In the light of these results, some policy recommendations are discussed. |
| Keywords: | globalization, human trafficking, cross section model |
| JEL: | C21 F53 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:110134&r= |
| By: | Sébastien Laffitte (CEPS - Centre d'Economie de l'ENS Paris-Saclay - ENS Paris Saclay - Ecole Normale Supérieure Paris-Saclay - Université Paris-Saclay); Julien Martin (CEPR - Center for Economic Policy Research - CEPR); Mathieu Parenti (ECARES - European Center for Advanced Research in Economics and Statistics - ULB - Université libre de Bruxelles); Baptiste Souillard (ECARES - European Center for Advanced Research in Economics and Statistics - ULB - Université libre de Bruxelles); Farid Toubal (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, CEPR - Center for Economic Policy Research - CEPR, LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Minimum corporate taxation is the second Pillar of the reforms of international corporate taxation. It is a simple and powerful tool that could curb profit shifting towards low or no tax jurisdictions. Its implementation would allow France to tax the profits that French headquarters have shifted to tax havens, but also to reduce the erosion of its tax base. We estimate the French corporate income tax (CIT) revenues would increase by almost 6 billion euros in the short run after the implementation of an effective minimum tax rate of 15% and by 8 billion euros at a rate of 21%. CIT gains may vary substantially depending on the scope of the tax base, the possibility of headquarters' inversion, and whether it includes domestic corporations or not. CIT gains are relatively higher in France than in Germany or the United States. The expected gains are substantially larger than those to be expected from the implementation of the first Pillar of the reform in its version proposed by the US in April 2021, which opens up rights to tax the 100 largest corporations in the world according to their sales' destination. According to our estimates, Pillar One would bring in about 900 million euros for France. |
| Keywords: | Tax rate,multinational corporation,reform |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-03361513&r= |