nep-int New Economics Papers
on International Trade
Issue of 2022‒05‒23
thirty-two papers chosen by
Luca Salvatici
Università degli studi Roma Tre

  1. Trade, Trees, and Contingent Trade Agreements By Bård Harstad
  2. Disunited Kingdom? Brexit, trade and Scottish independence By Hanwei Huang; Thomas Sampson; Patrick Schneider
  3. International Friends and Enemies By Benny Kleinman; Ernest Liu; Stephen J. Redding
  4. Impact of International Investment Agreements on Japanese FDI: A Firm-level Analysis By URATA Shujiro; BAEK Youngmin
  5. Trade Facilitation and Economic Growth Among Middle-Income Countries By Victor Ushahemba Ijirshar
  6. Effect of the duration of membership in the World Trade Organization on Trademark Applications By Gnangnon, Sèna Kimm
  7. Global Value Chain and Business Cycle Comovement: Does Distance Matter? By Daoju Peng; Kang Shi; Juanyi Xu
  8. Enhanced Intergenerational Occupational Mobility through Trade Expansion: Evidence from Vietnam By Mitra, Devashish; Pham, Hoang; Ural Marchand, Beyza
  9. The Impacts of the Dollar-Renminbi Exchange Rate Misalignment on the China-United States Commodity Trade: An Asymmetric Analysis By Sabrine Ferjani; Sami Saafi; Ridha Nouira; Christophe Rault
  10. Does mobile money services adoption foster intra-African goods trade? By Fayçal Sawadogo; Abdoul-Akim Wandaogo
  11. Importing Air Pollution? Evidence from China's Plastic Waste Imports By Unfried, Kerstin; Wang, Feicheng
  12. Performance feedback and export intensity of Chinese private firms: Moderating roles of institution-related factors By Meitong Dong; Liwen Wang; Defeng Yang; Kevin Zhou
  13. The Trade Reform Wave of 1985-1995 By Douglas A. Irwin
  14. Migration and invention in the Age of Mass Migration By DIodato, Dario; Morrison, Andrea; Petralia, Sergio
  15. Impacts of Increased Chinese Imports on Japan’s Labor Market: Firm and Regional Aspects By HAYAKAWA Kazunobu; ITO Tadashi; URATA Shujiro
  16. Multi-Product Firms in International Economics By Michael Irlacher
  17. Protecting noncommunicable disease prevention policy in trade and investment agreements By Thow, Anne Marie; Garde, Amandine; Winters, L. Alan; Johnson, Ellen; Mabhala, Andi; Kingston, Paul; Barlow, Pepita
  18. Innovation catalysts: how multinationals reshape the global geography of innovation By Crescenzi, Riccardo; Dyevre, Arnaud; Neffke, Frank
  19. The trade/GDP ratio as a measure of openness By Michael Bleaney; Mo Tian
  20. An assessment of Sudan’s wheat value chains: Exploring key bottlenecks and challenges By Abdelaziz, Fatma; William, Amy; Abay, Kibrom A.; Siddig, Khalid
  21. Refugee Migration and the Labor Market: Lessons from 40 Years of Post-Arrival Policies in Denmark By Jacob Nielsen Arendt; Christian Dustmann; Hyejin Ku
  22. International Protection of Consumer Data By Yongmin Chen; Xinyu Hua; Keith E. Maskus
  23. The lessons of the Covid-19 pandemic for National security By Jacques Fontanel
  24. Is Domestic Uncertainty a Local Pull Factor Driving Foreign Capital Inflows? New Cross-Country Evidence By Sangyup Choi; Gabriele Ciminelli; Davide Furceri
  25. Exchange Rate Misalignments, Foreign Direct Investment and Industrial Performance in Sub-Saharan Africa By Kirsi Zongo; Mahamadou Diarra
  26. Russia’s Attack on Ukraine: Economic Challenges, Embargo Issues & a New World Order By Paul J. J. Welfens
  27. A potential sudden stop of energy imports from Russia: Effects on energy security and economic output in Germany and the EU By Berger, Eva M.; Bialek, Sylwia; Garnadt, Niklas; Grimm, Veronika; Other, Lars; Salzmann, Leonard; Schnitzer, Monika; Truger, Achim; Wieland, Volker
  28. Employer Attitudes and the Hiring of Immigrants and International Students: Evidence from a Survey of Employers in Canada By Fang, Tony; Xiao, Na; Zhu, Jane; Hartley, John
  29. The economic effects of stopping Russian energy Import in Poland By Jakub Sokolowski; Marek Antosiewicz; Piotr Lewandowski
  30. Can trade contribute to a global environmental sustainability? By Elverdin, Pablo; Glauber, Joseph W.; Laborde Debucquet, David; Piñeiro, Valeria
  31. Infrastructure and the politics of African state agency: shaping the Belt and Road Initiative in East Africa By Chiyemura, Frangton; Gambino, Elisa; Zajontz, Tim
  32. Global socio-economic and climate change mitigation scenarios through the lens of structural change By Julien Lefevre; Thomas Le Gallic; Panagiotis Fragkos; Jean-François Mercure; Yeliz Simsek; Leonidas Paroussos

  1. By: Bård Harstad
    Abstract: Can trade agreements motivate environmental conservation? I first present a model whereby the government in the South expands its production capacity (e.g., deforest) before trading with the North. After deriving negative relationships between tariff reductions and conservation, I show how all negative results are reversed if countries can negotiate a contingent trade agreement (CTA), where default tariffs vary with changes in the production capacity (or forest cover). A calibration suggests that growth and liberalization can cause Brazil’s agricultural area to expand by 27%, but this expansion can be avoided if the EU and the US offer a CTA.
    Keywords: international trade, trade agreements, deforestation, environmental conservation
    JEL: F18 F13 Q37
    Date: 2022
  2. By: Hanwei Huang; Thomas Sampson; Patrick Schneider
    Abstract: Scotland is a small, open economy that mostly trades with the rest of the UK. There is around six times more trade between Scotland and the rest of the UK than predicted by a standard gravity trade model. Scottish independence would raise trade costs within the UK by creating a new international border. We use a quantitative trade model to study the impact of changes in trade costs resulting from Brexit and independence on Scotland's economy. We estimate that independence would be two to three times more costly for Scotland than Brexit. Moreover, rejoining the EU following independence would do little or nothing to mitigate these costs. The combination of Brexit and independence is estimated to reduce Scotland's income per capita by between 6.3% and 8.7%.
    Keywords: Scottish independence, Brexit, quantitative trade, gravity, border costs
    Date: 2021–12
  3. By: Benny Kleinman (Princeton University); Ernest Liu (Princeton University); Stephen J. Redding (Princeton University)
    Abstract: We examine whether as countries become more economically dependent on a trade partner, they realign politically towards that trade partner. We use network measures of economic exposure to foreign productivity growth derived from the class of trade models with a constant trade elasticity. We establish causality using two different sources of quasi-experimental variation: China's emergence into the global economy and the reduction in the cost of air travel over time. In both cases, we find that increased economic friendship causes increased political friendship, and that our theory-based network measures dominate simpler measures of trading relationships between countries.
    Keywords: international relations, trade, productivity growth, real income
    JEL: F14 F15 F50
    Date: 2022–03
  4. By: URATA Shujiro; BAEK Youngmin
    Abstract: In this study, we examine the impact of Japan’s international investment agreements (IIAs) on the locational choice of Japanese firms’ foreign direct investment (FDI) by considering the quality of IIAs. We estimate the conditional logit model covering 94 host countries, 16 manufacturing sectors, and 12 non-manufacturing sectors from 2000 to 2019. We found that the presence of IIAs, particularly comprehensive and high-level ones, has a positive impact on Japan’s FDI. On the contrary, the past incidence of investor–state disputes has a negative impact. These effects are found to be particularly strong for FDI by small and medium-sized enterprises. High regulatory quality is found to attract FDI, whereas the positive impact of IIAs in attracting FDI is strong in countries with low regulatory quality.
    Date: 2022–04
  5. By: Victor Ushahemba Ijirshar
    Abstract: This study examined the relationship between trade facilitation and economic growth among the middle-income countries from 2010 to 2020 using 94 countries made up of 48 lower-middle-income countries and 46 upper-middle-income countries. The study utilized both difference and system Generalised Method of Moments (GMM) since the cross-sections (N) were greater than the periods (T). The study found that container port traffic, quality of trade and transport-related infrastructure have a strong influence on imports and exports of goods and national income while trade tariff hurts the growth of the countries. The study also found that most of the trade facilitation indicators indicated a weak positive influence on trade flows and economic growth. Based on these findings, the study recommends that reforms aimed at significantly lowering the costs of trading across borders among middle-income countries should be highly prioritized in policy formulations, with a focus on the export side by reducing at-the-border documentation, time, and real costs of trading across borders while the international organizations should continue to report the set of Trade Facilitation Indicators (TFIs) that identify areas for action and enable the potential impact of reforms to be assessed.
    Date: 2022–04
  6. By: Gnangnon, Sèna Kimm
    Abstract: This article has examined the effect of the duration of the membership in the World Trade Organization (WTO) on the submission of trademarks by countries' residents. The analysis has used an unbalanced sample of 124 countries (including developed and developing countries), and primarily the binominal regression approach, supplemented by the generalized method of moments estimator, utilized for robustness check. Results have shown that the effect of the duration of WTO membership on trademarks works through the channel of trade costs. This effect is positive for less developed economies and negative for relatively advanced economies. These findings reflect the fact that as countries spend more time as WTO members, they experience a higher submission of patents relatively to trademarks, notably if they enjoy an improvement in their real per capita income (and export complex products). Furthermore, countries that receive higher Aid for Trade flows (which help to reduce trade costs) experience yet a higher number of trademarks applications, but to a lesser extent than patents filings.
    Keywords: Duration of WTO membership,Residents' trademark applications,Trade costs,Aid for Trade
    JEL: O34 F14 F35
    Date: 2022
  7. By: Daoju Peng (International School of Economics and Management, Capital University of Economics and Business, Beijing); Kang Shi (Department of Economics, Chinese University of Hong Kong); Juanyi Xu (Department of Economics, Hong Kong University of Science and Technology)
    Abstract: A salient feature of recent globalization is the emergence of global value chain, along which countries specialize in different positions. These difference of positions along the global production network may affect the business cycle comovement of two countries. Based on influence matrix derived from input-output linkage, a novel measure of distance is proposed to capture the heterogeneity between two countries in output response to country-specific technology shocks that propagate through global production network. We then show theoretically this distance is negatively correlated with output correlation across countries. To empirically test this conclusion, we relate the model to the data and calculate the distance and position measure using the world input-output table. The empirical result confirms a robust and significantly negative relationship between distance along the global value chain and business cycle synchronization. The closer the two countries' distance, the more comoved their output is. This result is robust to alternative distance measures and alternative output correlations. These findings thus offer new insights regarding international transmission of shocks through trade linkage.
    Keywords: Global Value Chain, Distance, Business Cycle Comovement
    JEL: F14 F44 F62
    Date: 2020–08
  8. By: Mitra, Devashish (Syracuse University); Pham, Hoang (Oregon State University); Ural Marchand, Beyza (University of Alberta, Department of Economics)
    Abstract: Using eight rounds of the Vietnam Household Living Standards Surveys (VHLSSs) spanning 16 years and exploiting the US Vietnam Bilateral Trade Agreement (BTA) in 2001 as a large export shock, we investigate the impact of this shock on intergenerational occupational mobility in Vietnam employing a difference-in-differences research design. Our analysis suggests that the BTA has led to substantial upward occupational mobility, allowing both sons and daughters to have better occupations than their parents, with the effects being larger for daughter-mother pairs. The effect is larger in the long-run compared to the short-run. We find evidence that the driving force is an increase in skill demand via gender-biased expansion in export volumes. The effects are largely driven by intersectoral resource reallocation rather than within-sector upgrades. In addition, the BTA induced a higher likelihood of college education for both sons and daughters, but of vocational training only for sons. Overall, the BTA shock accounts for 36% of the overall increase in mobility for both genders. Our results control for Vietnam's own tariff reductions, which do not seem to have any statistically significant impact on mobility.
    Keywords: International Trade; Export Market Access; Intergenerational Mobility
    JEL: F13 F16 F66 J62 O19
    Date: 2022–04–26
  9. By: Sabrine Ferjani; Sami Saafi; Ridha Nouira; Christophe Rault
    Abstract: Contrary to most existing studies of the literature that assumed that the effects of real exchange rate (RE) misalignment on trade flows are symmetric, this paper considers a more general and realistic framework allowing for possible asymmetric effects. We use monthly time-series data over the January 2002-October 2020 period from 66 two-digit industries that trade between China and the U.S. in order to avoid the well-known aggregation bias. Estimates of symmetric error-correction models (ECM) revealed that real dollar-renminbi rate misalignment has short-run effects on 35 U.S. exporting and 53 U.S. importing industries. These short-run effects translated into the long run in 18 and 17 industries, respectively. The numbers increased considerably when estimating asymmetric ECM. Indeed, short-run asymmetric effects were then found in 47 U.S. exporting and 62 U.S. importing industries, which translated into long-run asymmetric effects in 20 U.S. exporting and 21 U.S. importing industries. Our analysis highlights the importance of separating currency overvaluation from currency undervaluation in assessing the effects of the RE misalignment on trade flows between the U.S. and China and confirms that the impacts are industry specific. Our findings (robust to possible structural breaks) are useful for trading industries, and policymakers, and advocate accounting for asymmetries when examining the RE misalignment-trade flows nexus.
    Keywords: asymmetry, nonlinear ARDL, exchange rate misalignment, commodity trade, China, the United States
    JEL: F14 F31 C10
    Date: 2022
  10. By: Fayçal Sawadogo (CERDI - Centre d'Études et de Recherches sur le Développement International - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne); Abdoul-Akim Wandaogo (CERDI - Centre d'Études et de Recherches sur le Développement International - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne)
    Abstract: Using a propensity score matching methodology, we study the causal effect of mobile money services adoption on intra-African goods trade. We find that countries that adopted MM register a higher goods trade share in GDP of about 0.6 percent in comparison to non-adopters.
    Keywords: JEL classification : F10,O23,O33,O55 Mobile money,Goods trade,Impact analysis,Africa
    Date: 2021–02
  11. By: Unfried, Kerstin (University of Göttingen); Wang, Feicheng (University of Göttingen)
    Abstract: Plastic waste trade has grown considerably in the last decades and has caused severe environmental problems in recipient countries. As the largest recipient, China has permanently banned the imports of plastic waste since 2018. This paper examines the causal effect of plastic waste imports on air pollution by exploiting China's experience of importing plastic waste and the recent import ban. Combining data on plastic waste imports with PM2.5 data at the city level for the years 2000-2011, we find that plastic waste imports increased PM2.5 density significantly. This effect is linked to expanded production in the waste processing sector and an increased number of incineration. To evaluate the impact of the import ban on air quality, we employ daily data on air pollution between 2015 and 2020. Our difference-in-differences results show that affected cities, relative to other cities, experienced a significant improvement in air quality following the ban. These findings suggest potential environmental gains from banning plastic waste imports in other countries.
    Keywords: PM2.5, air pollution, waste import ban, plastic waste trade, China
    JEL: F18 F64 Q53 Q56
    Date: 2022–04
  12. By: Meitong Dong (HKU - The University of Hong Kong); Liwen Wang (Audencia Business School, Shenzhen Univerisity [Shenzhen]); Defeng Yang (Jinan University [Guangzhou]); Kevin Zhou (HKU - The University of Hong Kong)
    Abstract: Building on the behavioral theory of the firm and institutional view, we examine how performance feedback (i.e., a focal firm's performance relative to its industry peers) affects export intensity and how institution-related factors moderate this relationship. Using a sample of Chinese private manufacturing firms, we find that positive performance feedback lowers export intensity while the relationship between negative performance feedback and export intensity is insignificant. Moreover, outperforming firms are likely to decrease their export intensity even more when they are located in regions of better institutional development or have political connections. Underperforming firms with political connections tend to increase their export intensity. These findings enrich our understanding of the export behavior of emerging market firms.
    Keywords: performance feedback,export intensity,institutional development,political connections,behavioral theory of the firm,institutional view
    Date: 2022
  13. By: Douglas A. Irwin
    Abstract: The decade from 1985 to 1995 was an unprecedented period of declining barriers to global trade. The reform wave was especially pronounced in developing countries where overvalued currencies were eliminated, quantitative import restrictions dismantled, and import tariffs reduced. What accounts for this remarkable transformation in policy? This paper focuses on how many of these restrictions were imposed for balance of payments purposes. As the benefits of managing payments imbalances through exchange rate adjustments rather than import controls came to be understood, economists in high-ranking government positions had the opportunity to shift policy in this direction. Perhaps surprisingly, special interests played little role in fostering the move to more open markets.
    JEL: B17 F13 F31
    Date: 2022–04
  14. By: DIodato, Dario; Morrison, Andrea; Petralia, Sergio
    Abstract: More than 30 million people migrated to the USA between late-ninetieth and early-twentieth century, and thousands became inventors. Drawing on a novel dataset of immigrant inventors in the USA, we assess the city-level impact of immigrants' patenting and their contribution to the technological specialization of the receiving US regions between 1870 and 1940. Our results show that native inventors benefited from the inventive activity of immigrants. In addition, we show that the knowledge transferred by immigrants gave rise to new and previously not exiting technological fields in the US regions where immigrants moved to.
    Keywords: Age of Mass Migration; immigration; innovation; knowledge spill-over; patent; USA
    JEL: F22 O31 R30 J61
    Date: 2022–03–16
  15. By: HAYAKAWA Kazunobu; ITO Tadashi; URATA Shujiro
    Abstract: Using firm/plant-level data from the Census of Manufacture, this study investigates the impact of Chinese import competition, focusing on different effects based on firm characteristics and regional factors. We find that import competition from China harms Japanese firms’ survival ratios, with the negative impacts being especially strong for smaller firms. Subcontractors are also more vulnerable to Chinese import competition. However, subcontractors in metropolitan areas experience lesser negative impact. In terms of the effects on firm employment, import competition from China had a negative impact, but no statistically significant difference exists based on firm size or whether firms are subcontractors. Firms with overseas affiliates in China or multiple domestic plants reduced their employment in Japan. Moreover, plants in Tokyo, Aichi, and Osaka areas have been particularly inflicted an adverse effect.
    Date: 2022–04
  16. By: Michael Irlacher
    Abstract: A striking pattern in transaction-level data is the concentration of international shipments in the hands of a few large firms. One common feature of dominating high-performance firms is that they produce multiple products and ship them to many destinations. Motivated by the emergence of highly detailed data at the firm-product-destination level, a series of theoretical and empirical papers studies the role of multi-product firms (MPFs) in international trade. This survey reviews the evidence on the importance of MPFs in international markets and highlights the key theoretical as well as empirical results that the literature has produced in the last decade.
    Keywords: survey, multi-product firms, international economics, theory, empirics
    JEL: F10 F12 F14
    Date: 2022
  17. By: Thow, Anne Marie; Garde, Amandine; Winters, L. Alan; Johnson, Ellen; Mabhala, Andi; Kingston, Paul; Barlow, Pepita
    Abstract: Preventing noncommunicable diseases is a global priority, for which the World Health Organization has recommended policies to reduce the consumption of tobacco products, alcohol and unhealthy foods. However, regulation has been strongly opposed by affected industries, who have invoked the provisions of legally binding trade and investment agreements. The aim of this analysis of the legal, economic and public health literature was to present a short primer on the relationship between noncommunicable disease prevention policy and trade and investment agreements to help public health policy-makers safeguard public health policies. The analysis identified opportunities for protecting, and even promoting, public health in trade and investment agreements, including: (i) ensuring exceptions for public health measures are included in agreements; (ii) committing to good regulatory practice that balances transparency and cooperation with the need for governments to limit the influence of vested interests; (iii) ensuring trade and investment agreement preambles acknowledge the importance of public health; (iv) excluding investor–state dispute settlement mechanisms from agreements; and (v) limiting the scope and definition of key provisions on investor protection to reduce the risk of investment disputes. This synthesis of the multidisciplinary literature also provides support for greater strategic and informed engagement between the health and trade policy sectors. In addition, ensuring a high level of health protection in trade and investment agreements requires cooperation between disciplines, engagement with experts in law, economics and public health policy, and fully transparent policy processes and governance structures.
    JEL: L81
    Date: 2022–04–01
  18. By: Crescenzi, Riccardo; Dyevre, Arnaud; Neffke, Frank
    Abstract: We study whether and when Research and Development (R&D) activities by foreign multinationals facilitate the formation and growth of new innovation clusters. Combining information on nearly four decades’ worth of patents with socio‐economic data for regions that cover virtually the entire globe, we use matched difference‐in‐differences estimation to show that R&D activities by foreign multinationals have a positive causal effect on local innovation rates. This effect is sizeable: over a five‐year period, foreign research activities help a region climb 14 centiles in the global innovation ranks. This effect materializes through a combination of knowledge spillovers to domestic firms and the attraction of new foreign firms to the region. However, not all multinationals generate equal benefits. In spite of their advanced technological capabilities, technology leaders generate fewer spillovers than technologically less advanced multinationals. A closer inspection reveals that technology leaders also engage in fewer technological alliances and exchange fewer workers with local firms abroad than less advanced firms. Moreover, technology leaders tend to set up their foreign R&D activities in regions with lower levels of economic development than less advanced firms, yet with comparable public sector research capacity. These findings suggest that multinationals with high levels of technological sophistication face comparatively unfavorable tradeoffs between the costs and benefits of local spillovers, underscoring the importance of understanding corporate strategy when analyzing innovation clusters.
    Keywords: innovation; regions; foreign direct investment; patenting; cluster emergence; European Union Horizon 2020 Program H2020/2014‐2020) (Grant Agreement n 639633‐MASSIVE‐ERC‐ 2014‐STG; T&F deal
    JEL: O32 O33 R11 R12
    Date: 2022–04–21
  19. By: Michael Bleaney; Mo Tian
    Abstract: The ratio of trade to GDP is often used as a summary measure of a country’s openness to the rest of the world. It is well known that the trade/GDP ratio is affected by relatively time-invariant factors, such as country size and remoteness from trading partners, that can largely be controlled for in cross-country panels by using country fixed effects. It is shown here that there are also other important, time-varying influences on the trade/GDP ratio that have been little investigated, such as the prices of commodity exports and imports, the real effective exchange rate and the ratio of investment to GDP. These factors are shown to be significant, and not only in the short run, and need to be taken into account in estimating the long-run effects of transport costs or trade policy on the trade/GDP ratio.
    Keywords: trade openness; real exchange rate; commodity prices; investment
    Date: 2022
  20. By: Abdelaziz, Fatma; William, Amy; Abay, Kibrom A.; Siddig, Khalid
    Abstract: Wheat is a strategic and political good in Sudan and has played a central role in the country’s economy during successive regimes. Disruptions in Sudan’s wheat value chain usually leads to shortages of wheat bread, price spikes, and political unrest. With the objective of ensuring sufficient grain supplies for domestic consumption, Sudan’s domestic and imported wheat sectors have been subject to several government interventions over the last decades. Most interventions have focused on and aimed to (i) stimulate domestic production, (ii) ensure a reliable flow of wheat imports to compensate for low domestic wheat production, and (iii) monitor wheat flour and bread distribution processes to limit leakage and wastage. Sudan has two distinct wheat value chains: one for imported wheat and one for domestic wheat. The imported wheat value chain involves three major actors: milling companies, wheat flour agents, and bakeries. The domestic (locally produced) wheat value chain involves four main actors: wheat producers, wheat grain wholesalers, wheat grain retailers, and consumers. To understand the landscape of the wheat sector in Sudan, this report relies on rapid assessment surveys of the main wheat value chain actors. The aim is to closely identify different value chain actors’ distinct roles of the and to explore their linkages. The report evaluates and identifies key bottlenecks that likely cause wheat and bread supply disruptions while also shedding light on untapped opportunities and possible policy options to improve the functioning of Sudan’s wheat sector. We document wheat value chain actors’ policy preferences, which vary depending on whether actors are engaged in the domestic or the imported value chain. The report highlights the differential impact of COVID-19 and related mobility restrictions on wheat value chain members. For example, while wheat production remains mostly unaffected by the outbreak of the COVID-19 pandemic, the marketing, trade, and distribution of wheat and wheat flour has been adversely affected by it.
    Keywords: REPUBLIC OF THE SUDAN, EAST AFRICA, AFRICA SOUTH OF SAHARA, AFRICA, assessment, wheat, value chains, domestic production, international trade, governance, prices, farmers, wholesale markets, retail marketing, policies, Coronavirus, coronavirus disease, Coronavirinae, COVID-19
    Date: 2022
  21. By: Jacob Nielsen Arendt; Christian Dustmann; Hyejin Ku
    Abstract: Denmark has accepted refugees from a large variety of countries and for more than four decades. Denmark has also frequently changed policies and regulations concerning integration programs, transfer payments, and conditions for permanent residency. Such policy variation in conjunction with excellent administrative data provides an ideal laboratory to evaluate the effects of different immigration and integration policies on the outcomes of refugee immigrants. In this article, we first describe the Danish experience with refugee immigration over the past four decades. We then review different post-arrival refugee policies and summarize studies that evaluate their effects on the labor market performance of refugees. Lastly, we discuss and contrast these findings in the context of international studies of similar policies and draw conclusions for policy.
    Keywords: refugee integration, immigration policies, labor supply, employment, language
    JEL: J22 J24 J61
    Date: 2022
  22. By: Yongmin Chen (University of Colorado Boulder); Xinyu Hua (Hong Kong University of Science and Technology); Keith E. Maskus (University of Colorado Boulder)
    Abstract: We study the international protection of consumer data in a model where data from product sales generate additional revenue to firms but disutility to consumers. When data usage lacks transparency, a firm suffers a commitment problem and overuses consumer data. As transparency increases, the firm may adjust prices inefficiently across countries with different privacy preferences. Contrary to the result in the single-country case, more transparency can exacerbate data-usage and output distortions in the global economy, and unilaterally-imposed regulation on data usage may reduce global welfare. There can be substantial gains from international coordination – though not necessarily uniformity – of data regulations.
    Keywords: consumer data, privacy, multinational Örm, regulation, data localization, international coordination
    JEL: F23 D18 L15
    Date: 2020–11
  23. By: Jacques Fontanel (CESICE - Centre d'études sur la sécurité internationale et les coopérations européennes - UGA - Université Grenoble Alpes - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble - UGA - Université Grenoble Alpes)
    Abstract: The crisis of globalisation and the rise of the Coivd-19 pandemic pose new threats to the national security of all countries. States have been increasingly challenged on their role, particularly in the economic order. Their actions concerning ecology, climate or air pollution have been strongly inspired by the decisions of specialised international organisations, too often advised by dominant commercial and financial interests. In this context, states have no longer been able to assume the full range of national security components. Mercantilists considered that dependence on a State's foreign trade led to an unacceptable reduction to the power of the Prince. Today, all countries are dependent on others. Moreover, the pandemic has highlighted the inability of states to find quick solutions to the economic dependencies of states, creating a sense of insecurity among citizens.
    Keywords: National security,globalization,pandemic,scarcity
    Date: 2022–02–17
  24. By: Sangyup Choi (Yonsei Univ); Gabriele Ciminelli (OECD); Davide Furceri (IMF)
    Abstract: Theory and conventional wisdom suggest that an increase in uncertainty in one country scares away foreign investment. But, due to the limited availability of cross-country uncertainty data, empirical evidence remains scarce. This paper provides a systematic analysis of how foreign capital inflows react to an increase in political and economic uncertainty, proxied using the World Uncertainty Index. We focus on bank credit, portfolio debt, and portfolio equity capital inflows into 143 countries from 51 source countries. We find that an increase in domestic uncertainty induces a substantial and persistent decrease in bank credit and portfolio debt inflows, and (to a lesser extent) in equity inflows. The effects on portfolio flows are larger for countries with more open capital markets. We also uncover important differences in the response of portfolio flows through actively-managed and passive funds. The former are similarly sensitive to changes in uncertainty that are country-specific (purely local uncertainty) and common across countries (global uncertainty), while the latter are only sensitive to global uncertainty.
    Keywords: Uncertainty; Capital flows; World Uncertainty Index; Mutual funds; ETFs; COVID-19
    JEL: F21 F32 F42
    Date: 2022–04
  25. By: Kirsi Zongo (Université Norbert ZONGO de Koudougou); Mahamadou Diarra (Université Norbert ZONGO de Koudougou)
    Abstract: Cet article a pour objectif d'analyser les effets des désalignements du taux de change sur les performances industrielles des économies d'Afrique Sub-saharienne en montrant que les IDE pourraient constituer un canal par lequel transitent ces effets. Pour ce faire, le modèle comportemental du taux de change d'équilibre a été utilisé dans la détermination du taux change d'équilibre ainsi que ses désalignements à l'aide de la technique ARDL en panel. Ensuite, le modèle structurel de petite économie ouverte à deux secteurs d'activités a été utilisé pour établir les relations entre taux de change, IDE et performances industrielles. Le modèle GMM en système a permis d'élucider la relation entre désalignement du taux de change et IDE tandis que l'économétrie spatiale a servis d'analyser les effets spatiaux de l'interaction entre ces deux variables sur les performances industrielles des économies d'ASS. Il ressort des estimations que la sous-évaluation du taux de change favorise l'entrée des IDE dans les économies d'ASS et que l'interaction entre ces deux variables améliore les performances industrielles des économies de cette zone. L'article préconise alors l'adoption des sous-évaluations du taux de change ; l'amélioration du climat des affaires pour favoriser l'entrée massive des IDE.
    Keywords: Afrique Sub-saharienne,économétrie spatiale,performances industrielles,sous-évaluation,Taux de change
    Date: 2022–04–23
  26. By: Paul J. J. Welfens (Europäisches Institut für Internationale Wirtschaftsbeziehungen (EIIW))
    Abstract: The launch of Russia’s war of aggression against Ukraine on February 24th, 2022, has resulted in great suffering for the people of Ukraine and has created turning point in Europe. Western countries and Japan have imposed very comprehensive sanctions against Russia, the aggressor. The country is largely politically isolated on the international stage, but seemingly has China - still - on its side. Large movements of refugees are to be expected, along with sharp price increases for gas and - somewhat less so - for oil, but also for wheat, with Russia and Ukraine being important exporter countries of that commodity representing together a combined 28% share of the world market. Some economists have suggested Germany impose an energy import boycott against Russia. A realistic analysis, however, arrives at significantly higher losses in real income than the 0.5% to 3% found, for example, by Bachmann et al. (2022), although additional retaliatory measures (e.g., tariff increases) by Russia and other effects must indeed also be considered: -6% in terms of real income and increased unemployment rates are conceivable as an overall effect in Germany; and there will be negative Russian spillover effects to central Asian countries which also have not been considered in the Bachman et al approach. On March 23rd, President Putin declared that Russia’s energy exports to “unfriendly countries” would have to be paid for in Rubles in the future, which is a clear strategic move in terms of the international economic conflict between the West and Russia. The latter could itself impose an energy supply boycott on Germany and also other EU countries. Additional supplies from, say, the US - in the form of liquefied natural gas (LNG) - would be limited in relation to the redistribution of supplies within the EU, as the pipeline network is still poorly integrated. Poland, Bulgaria, Austria, Germany and Italy are likely to face particular problems with natural gas supplies in the event of an energy import boycott. As of May 24th, 2022, US citizens will not be allowed to accept interest payments from either private Russian companies or the Russian state; this measure is peculiar and hardly compatible with the idea of a constitutional state, since even companies from Russia that are not actually in danger of bankruptcy will be artificially pushed toward bankruptcy - with the US switching to preventing Dollar bond payments to April 6th (due to the Russian massacre in Bucha, Ukraine), the first Russian bond interest payment missed concerned Russian Railways on April 11th. The very high current and expected numbers of refugees will have positive demand effects in certain countries in 2022 and positive supply effects in overall economic production thereafter. The global economy will be marked by a new economic slowdown and higher inflation rates in 2022/23; it could face a breakup into regional “blocs” and a reduced effectiveness of international economic organizations in the event of international economic conflicts. The weakening of the international legal order should be countered by OECD countries. The figures presented by the Kiel Institute for the World Economy for combined humanitarian, financial and military support to Ukraine are grossly misleading; if one takes into account the important spending on refugees from Ukraine and the corresponding (implied) pledges by OECD countries, EU spending in favour of the Ukrainian people is significantly higher than that of the US, and Germany's spending is also significantly higher than shown in the Kiel study. A new and lasting order for peace in Europe is urgently required. An EU eastern enlargement to include Ukraine will bring about new BREXIT-type risks and could destabilize the EU considerably.
    Keywords: Ukraine war, Russia sanctions, economic effects of the war in Ukraine, US, EU, international economic order, aid for Ukraine
    JEL: F50 F51 N44 Q48
    Date: 2022–04
  27. By: Berger, Eva M.; Bialek, Sylwia; Garnadt, Niklas; Grimm, Veronika; Other, Lars; Salzmann, Leonard; Schnitzer, Monika; Truger, Achim; Wieland, Volker
    Abstract: The Russian war of aggression against Ukraine since 24 February 2022 has intensified the discussion of Europe's reliance on energy imports from Russia. A ban on Russian imports of oil, natural gas and coal has already been imposed by the United States, while the United Kingdom plans to cease imports of oil and coal from Russia by the end of 2022. The German Federal Government is currently opposing an energy embargo against Russia. However, the Federal Ministry for Economic Affairs and Climate Action is working on a strategy to reduce energy imports from Russia. In this paper, the authors give an overview of the German and European reliance on energy imports from Russia with a focus on gas imports and discuss price effects, alternative suppliers of natural gas, and the potential for saving and replacing natural gas. They also provide an overview of estimates of the consequences on the economic outlook if the conflict intensifies.
    Date: 2022
  28. By: Fang, Tony (Memorial University of Newfoundland); Xiao, Na (Laurentian University); Zhu, Jane (Memorial University of Newfoundland); Hartley, John (Memorial University of Newfoundland)
    Abstract: What are the perceptions of employers towards hiring immigrants and international students in Atlantic Canada? How are they related to hiring outcomes? Our analysis based on a 2019 random, representative survey of 801 employers finds that those employers who report beliefs that multiculturalism is creativity-enhancing in the workplace and that immigrants are harder working than local workers are more likely to report hiring or intending to hire newcomers and international students Although most employers report positive attitudes towards newcomers and international students, employers who report perceptions that immigrants tend to take jobs from domestic workers, accept lower pay, have a lower retention probability, face language barriers, have higher training costs, and hold unreliable credentials are less likely to report hiring from this group.
    Keywords: immigrants, international students, labour and skill shortages, employer hiring attitudes, employer survey, Atlantic Canada
    JEL: J23 J61 J63 J68
    Date: 2022–04
  29. By: Jakub Sokolowski; Marek Antosiewicz; Piotr Lewandowski
    Abstract: We estimate the macroeconomic and distributional effects that a ban on fuel imports from Russia would have in Poland. We simulate the embargo as a hike in oil, gas and coal prices, and evaluate the macroeconomic effects with a dynamic general equilibrium model. We soft-link it with a microsimulation model based on Household Budget Survey data to assess the impacts on various income groups. We find that the effects of an embargo on Russian fuels would be substantial but manageable. Depending on the severity of the price hikes, we expect Poland’s GDP to be lower by 0.2–3.3% by the end of 2022, and by 2.1–5.7% by 2025. Furthermore, depending on the price increases, high-income households would spend an additional 0.2–1.3% of their incomes on energy in 2022 and 0.7–1.6% in 2025, and low-income households would spend 0.3–4.7% more of their incomes on energy in 2022 and 2.6–4.8% in 2025. We suggest direct money transfers to less affluent households, and investments in alternative gas and oil supplies, energy efficiency, renewable energy and nuclear power as instruments that could ease the negative economic impacts of the embargo.
    Keywords: embargo; distributional effects; microsimulation; general equilibrium
    JEL: H23 P18 O15
    Date: 2022–05
  30. By: Elverdin, Pablo; Glauber, Joseph W.; Laborde Debucquet, David; Piñeiro, Valeria
    Abstract: Achieving world food security is more complex nowadays. It is not only necessary to pay attention to the availability of food, but also to the way in which it is produced, paying special attention to the impact of the food production systems on climate change and natural resources sustainability. The challenge is to produce a diversified basket of nutritious food in sufficient quantity while reducing greenhouse gas emissions and minimizing the impact on natural resources. Accomplishing these diverse goals requires an integrated strategy that takes into account increased productivity and the environmental sustainability of food production systems with a focus on efficient use of land, water, fertilizers and energy.
    Keywords: WORLD; trade; environment; sustainability; food production; natural resources; greenhouse gas emissions; agriculture; environmental sustainability
    Date: 2022
  31. By: Chiyemura, Frangton; Gambino, Elisa; Zajontz, Tim
    Abstract: Infrastructure development has experienced a political renaissance in Africa and is again at the centre of national, regional, and continental development agendas. At the same time, China has been identified by African policy-makers as a particularly suitable strategic partner. As infrastructure has become a main pillar of Sino-African cooperation, there has been growing analytical interest on the role of African actors in shaping the terms and conditions and, by extension, the implementation of infrastructure projects with Chinese participation. This follows a more general African “agency turn” in China-Africa studies, which has shifted the research focus on the myriad ways in which African state and non-state actors shape the continent’s engagements with China. This article is situated within this growing body of literature and explores different forms of African state agency in the context of Tanzania’s planned Bagamoyo port, Ethiopia’s Adama wind farms, and Kenya’s Lamu port. We posit a non-reductionist and social-relational ontology of the (African) state which sees the state as a multifaceted and multi-scalar institutional ensemble. We show that the extent and forms of state agencies exerted are inherently interrelated with and, thus, highly contingent upon concrete institutional, economic, political, and bureaucratic contexts in which African state actors are firmly embedded. In doing so, we make the case for a context-sensitive analysis of various spheres of state agency in particular conjunctures of Sino-African engagement.
    Keywords: African agency; BRI; Ethiopia; Kenya; Tanzania; infrastructure; state; Tim Zajontz’s field research was conducted with the help of PhD scholarships from the Friedrich Ebert Foundation and the Economic and Social Research Council (ESRC).; Springer deal
    JEL: R14 J01
    Date: 2022–04–01
  32. By: Julien Lefevre (AgroParisTech, CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Thomas Le Gallic (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Panagiotis Fragkos; Jean-François Mercure (University of Exeter, CAM - University of Cambridge [UK]); Yeliz Simsek (University of Exeter); Leonidas Paroussos
    Abstract: This paper analyses structural change in the economy as a key but largely unexplored aspect of global socioeconomic and climate change mitigation scenarios. Structural change can actually drive energy and land use as much as economic growth and influence mitigation opportunities and barriers. Conversely, stringent climate policy is bound to induce specific structural and socioeconomic transformations that are still insufficiently understood. We introduce Multi-Sectoral Integrated Assessment Models as main tools to capture the key drivers of structural change and we conduct a multi-model study to assess main structural effectschanges of the sectoral composition and intensity of trade of global and regional economiesin a baseline and 2°C policy scenario by 2050. First, the range of baseline projections across models, for which we identify the main drivers, illustrates the uncertainty on future economic pathways-in emerging economies especially-and inform on plausible alternative futures with implications for energy use and emissions. Second, in all models, climate policy in the 2°C scenario imposes only a second-order impact on the economic structure at the macrosectoral level-agriculture, manufacturing and services-compared to changes modelled in the baseline. However, this hides more radical changes for individual industries-within the energy sector especially. The study, which adopts a top-down framing of global structural change, represents a starting point to kick-start a conversation and propose a new research agenda seeking to improve understanding of the structural change effects in socioeconomic and mitigation scenarios, and better inform policy assessments.
    Keywords: Energy sector,Multi-sectoral macroeconomic modelling,Climate policy,Socio-economic pathways,Structural change
    Date: 2022

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