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on International Trade |
| By: | ARA Tomohiro |
| Abstract: | This paper examines the role played by global firms that simultaneously import and export in generating welfare gains. In a setting of sequential production where final goods are produced with intermediate goods from different stages of production which are subject to selection into importing and exporting, we show that the presence of importing-exporting can amplify welfare gains from trade under an empirically observable condition: the market share of exporters conditional on also importers is greater than the market share of exporters in the general population. Under the condition that holds when importing and exporting exhibit complementarity, the standard effects of trade liberalization on aggregate outcomes are magnified through disproportionate share reallocations toward most efficient global firms. |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:22071&r= |
| By: | Li, Meng; Meng, Bo; Gao, Yuning; Wang, Zhi; Zhang, Yaxiong; Sun, Yongping |
| Abstract: | This study integrates the new global value chain (GVC) accounting method that explicitly considers the difference in the production functions of multinational enterprises (MNEs) and domestically-owned firms into existing production- and consumption-based CO2 emissions measures. This enables us to consistently trace emissions in GVCs through trade- and foreign direct investment (FDI)-related routes at the bilateral country-sector level by firm ownership. Based on OECD data, our empirical results, reveal that emissions related to FDI account for 15.2 percent of the world's total emissions and 58.1 percent of the world's GVCs emissions, 39.2 percent of which are emissions related to FDI for foreign demands in 2015. From 2000 to 2015, south-south emission transfers experienced rapid growth with relatively high carbon intensity. MNEs play a significant role through FDI in south countries, both in generating emissions as energy users and in transferring emissions as high-carbon intensive intermediate goods users in GVCs. There is a substantial difference in the patterns of emissions creation, transfer, and absorption in GVCs by firm ownership. These findings help us to better understand who creates emissions for whom and from which route and their potential environmental responsibility along GVCs. |
| Keywords: | embodied carbon emissions,carbon footprint,global value chain,multinational enterprises,emission responsibility,GVC,FDI |
| JEL: | Q54 C67 F64 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:sgscdp:2&r= |
| By: | Rodolfo G. Campos (Banco de España); Iliana Reggio (Universidad Autónoma de Madrid); Jacopo Timini (Banco de España) |
| Abstract: | Between the 1940s and 1970s, Spain used a variety of economic policies that hindered international trade. Because the mix of tariffs, quotas, administrative barriers, and exchange rate regimes varied greatly over time, the quantification of the effect of the various trade policies on international trade in this period is particularly elusive. In this paper, we use historical bilateral trade flows and a structural gravity model to quantify the evolution of Spain’s border thickness, a summary measure of its barriers to international trade. We find that Spain’s borders in the period 1948-1975 were thicker than those of any other country in Western Europe, even after the liberalization of trade that started in 1959. These comparatively higher impediments to international trade implied substantial negative effects on consumer welfare. We estimate that accumulated welfare costs over the period 1948-1975 exceed 20% of a year’s total consumption. |
| Keywords: | Spain, Stabilization Plan, international trade, autarky |
| JEL: | F13 F14 F62 N74 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:2209&r= |
| By: | Halvarsson, Daniel (The Ratio Institute); Lark, Olga (Department of Economics, Lund University); Tingvall, Patrik (The National Board of Trade Sweden, Södertörn University); Videnord, Josefin (Uppsala University) |
| Abstract: | In this paper we study the link between globalization of firms and gender inequality. Specifically, we examine how the need for interpersonal contacts in trade and gender-specific differences in negotiations are related to the gender wage gap. Our key finding is that export of goods that are intensive in interpersonal contacts widens the gender wage gap. The effect is robust across various specifications and is most pronounced for domestic exporting firms, which do not trade within multinational corporations but with external foreign partners, where the contracting problem is most distinct. We ascribe this result to a male comparative advantage in bargaining. |
| Keywords: | Export; Gender wage gap; Gender inequality; Contract intensity; Interpersonal contacts; International trade |
| JEL: | F16 F66 J16 J31 |
| Date: | 2022–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2022_013&r= |
| By: | Taguchi, Hiroyuki; Zhao, Jun |
| Abstract: | This paper aims to evaluate the extent of China’s forward linkage of global value chains (GVCs) with emerging market economies of the Association of Southeast Asian Nations (ASEAN) compared to those with the US and Japan, and also to examine the nexus of China’s forward GVC linkage with logistics performances in emerging ASEAN economies as China’s trade partners. This study uses the UNCTAD-Eora Database and applies a structural gravity trade model for the empirical analysis. The statistical observations identified the major position of China’s GVC, which has transformed from a backward linkage to a forward linkage since the mid-2000s. The empirical estimation verified there is less linkage in China’s forward GVC with emerging ASEAN economies than with the US and Japan, and demonstrated that the lack of logistics performances in emerging ASEAN economies has been a significant factor in explaining the less linkage in China’s forward GVC with them. |
| Keywords: | Global Value Chains; Forward Linkage; Logistics Performances; China; Emerging ASEAN Economies |
| JEL: | F12 F14 O53 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113808&r= |
| By: | Bouët, Antoine; Calvo, Facundo; Glauber, Joseph W.; Laborde Debucquet, David; Martin, Will; Parent, Marie; Piñeiro, Valeria; Traore, Fousseini |
| Abstract: | The purpose of this review is to assess the extent to which the research outputs of Flagship 3, cluster on The Policy Environment for Value Chains (cluster 3.1) of the CGIAR Research Program on Policies, Institutions, and Markets (PIM) have been used to inform decisions and behaviors of representatives of government organizations, development agencies, researchers, donors, private firms, nongovernment organizations, and other users. The assessment both reviews the achievement of past milestones as well as looks forward to how re-searchers should support the trade agenda in developing countries going forward through their research and communication of research and what should be the focus in the research agenda for developing countries. There are already ongoing and forming activities for which strategic guidance, decisions on allocation of resources across activities, or other research decisions could benefit from this assessment. Areas for prioritization include evaluation of policy changes proposed by policymakers or proactively investigated by the PIM trade team (e.g., reduction in domestic support, lowering tariffs), a trade and nutrition database, work on trade and greenhouse gas emissions, future AATM editions, improving data on trade flows, analysis of impactful events such as COVID-19 and large-scale droughts on world markets and value chains, work on the future of trade multilateralism, research on global value chains and non-tariff measures, and research on advancing value chains for competitiveness and economic development. |
| Keywords: | WORLD; developing countries; capacity development; trade; agriculture; international trade; trade agreements |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:2130&r= |
| By: | Gnangnon, Sèna Kimm |
| Abstract: | The present article has investigated the effect of developing countries' duration of membership in the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) on their commercial services exports. It has relied on a set of 128 countries over the period from 2008 to 2019, and utilized the two-step system generalized method of moments estimator. It has revealed that the duration of membership in the GATT/WTO was associated with higher commercial services exports, including both modern and traditional services exports. However, Article XII Members (states that were not Members of GATT, but joined the WTO after its inception) have experienced higher commercial services exports (including traditional services exports) than Non-Article XII Members (i.e., states that were GATT Members before the creation of the WTO). For low-income member states, the membership duration has resulted in an increase in traditional services exports at the expense of modern services exports. Conversely, relatively wealthier member states have increased modern services exports at the expense of traditional services exports, as their membership duration rose. The analysis has also established that member states that have improved their capacities to use, adopt and adapt frontier technologies have enjoyed higher commercial services exports, including modern services exports, but have not experienced an increase in traditional services exports. Finally, the duration of membership in the GATT/WTO has led to higher commercial services exports, including both modern and traditional services exports for member states that have improved their penetration in the international markets for goods. The policy implications of the analysis are discussed. |
| Keywords: | Duration of membership in the GATT/WTO,Commercial services exports,Frontier technology readiness,Penetration in goods markets |
| JEL: | F15 O14 F53 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:262167&r= |
| By: | Lodefalk, Magnus (The Ratio Institute); Tang, Aili (Örebro universitet); Yu, Miaojie (The Ratio Institute) |
| Abstract: | We use survival analysis to analyse the impact of export credit guarantees on firms’ export duration using granular Swedish panel data at the firm-country and firm-country-product levels. The estimation results show that firms’ export survival substantially increases with guarantees, at both levels. The associations are particu- larly strong for smaller firms and contracts as well as in trade with riskier markets. The findings have implications for policies to promote long run export growth. |
| Keywords: | Survival; Exports; Export credit guarantees |
| JEL: | C14 C41 D22 F14 H81 |
| Date: | 2022–08–12 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0359&r= |
| By: | Saroj Bhattarai; Konstantin Kucheryavyy |
| Abstract: | We present a unified dynamic framework to study the interconnections between international trade and business cycle models. We prove an aggregate equivalence between a competitive, representative firm model that has aggregate production externalities and dynamic trade models that feature monopolistic competition, endogenous entry, and heterogeneous firms. The production externalities in the representative firm model have to be introduced in the intermediate and final good sectors so that the model is isomorphic to dynamic trade models that embody love-of-variety and selection effects. In a quantitative exercise with multiple shocks, we show that to improve the fit of the dynamic trade models with the data, the most important ingredient is negative capital externality in the intermediate good sector. We conclude that this presents a puzzle for the literature as standard dynamic trade models provide micro-foundations for positive capital externality. |
| Keywords: | international business cycle, dynamic trade models, heterogeneous firms, production externalities, monopolistic competition, export costs, entry costs |
| JEL: | F12 F41 F44 F32 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9870&r= |
| By: | Brancati, Emanuele (Sapienza University of Rome) |
| Abstract: | The lack of information is a relevant obstacle to the export activity of small and medium enterprises. This paper analyzes whether banks can support firms’ export by reducing informational asymmetries about foreign markets. We exploit a large sample of Italian firms for which we merge custom data with information on their lender banks. We identify a shock exogenous to firms’ export decisions by relying on preexisting lending relationships and exploiting the acquisition of a firm’s domestic bank by an internationalized banking group. Our results show that, after the acquisition, firms have a significantly higher probability of starting export in countries where the consolidated bank has a foreign branch, which proxies for the amount of information accumulated that can be shared with client firms. Conversely, the effect on the intensive margins of previously-exporting companies is largely insignificant. We interpret these findings as evidence of information spillovers that mainly reduce firms’ fixed entry costs in a foreign market. The analysis also shows that other channels, such as bank credit availability or trade-finance supply, are unlikely to drive our results. |
| Keywords: | firms, export, informational barriers, banks |
| JEL: | F23 F14 G21 G00 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15458&r= |
| By: | Parag Mahajan |
| Abstract: | Prior literature on the economic impact of immigration has largely ignored changes to the composition of labor demand. In contrast, this paper uses a comprehensive collection of survey and administrative data to show that heterogeneous establishment entry and exit drive immigrant-induced job creation and a rightward shift of the productivity distribution in U.S. local industries. High-productivity establishments are more likely to enter and less likely to exit in high immigration environments, whereas low-productivity establishments are more likely to exit. These dynamics result in productivity growth. A general equilibrium model proposes a mechanism that ties immigrant workers to high-productivity firms and shows how accounting for changes to the employer distribution can yield substantially larger estimates of immigrant-generated economic surplus than canonical models of labor demand. |
| Keywords: | immigration, business dynamics, productivity, firm heterogeneity |
| JEL: | J23 J61 L11 F22 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9874&r= |
| By: | Kadigi, Reuben M.J.; Robinson, Elizabeth; Szabo, Sylvia; Kangile, Joseph; Mgeni, Charles P.; De Maria, Marcello; Tsusaka, Takuji; Nhau, Brighton |
| Abstract: | The purpose of this paper is to investigate the Solow-Swan's proposition that poorer countries grow faster than richer countries causing declining income disparities across countries. The role of coffee trade in income convergence is also analyzed to enrich our understanding of whether traditional cash export crops, like coffee, contribute significantly to income convergence. We found that, GDP per capita was growing faster among coffee producers than coffee re-exporters, supporting the Solow-Swan's model. However, coffee export values and shares decreased with convergence for green coffee producers while increasing among re-exporters, implying unequal distribution of benefits along the global coffee value chain. |
| Keywords: | coefficient variation; coffee; GDP per capita convergence; Solow-Swan model; β-convergence; σ-convergence; Trade; Development and the Environment Hub Project (Project number ES/S008160/1) financed by the United Kingdom Research and Innovation (UKRI) - represented by the Research Councils UK (RCUK) Economic and Social Research Council (ESRC) with funds from the Global Challenges Research Fund (GCRF); A UKRI Collective Fund. |
| JEL: | R14 J01 J1 |
| Date: | 2022–05–26 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:115636&r= |
| By: | Chu, Angus C.; Peretto, Pietro; Xu, Rongxin |
| Abstract: | This study develops an open-economy Schumpeterian growth model with endogenous takeoff to explore the effects of exports on the transition of an economy from stagnation to innovation-driven growth. We find that a higher export demand raises the level of employment, which causes a larger market size and an earlier takeoff along with a higher transitional growth rate of domestic output per capita but has no effect on long-run economic growth. These theoretical results are consistent with empirical evidence that we document using cross-country panel data in which the positive effect of exports on economic growth becomes smaller, as countries become more developed, and eventually disappears. We also calibrate the model to data in China and find that its export share increasing from 4.6% in 1978 to 36% in 2006 causes a rapid growth acceleration, but the fall in exports after 2007 causes a growth deceleration that continues until recent times. |
| Keywords: | international trade; innovation; endogenous takeoff |
| JEL: | F43 O3 O4 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113957&r= |
| By: | Achinthya Koswatta |
| Abstract: | Studies show that when exports go up, innovation goes up as well. But what is the mediating effect of domestic institutions in the association between exports and innovation? If any, which institutions are more likely to improve exports and innovation in developing countries, and how? To address this lacuna, this study employs estimations of industry fixed effects for 22 two-digit manufacturing industries in the period from 1996 to 2018. The first estimation includes 57 developing countries, and the second estimation excludes extreme outliers or unusual countries from the sample. |
| Keywords: | Innovation, Mediation analysis, Institutions, Fixed effects, Manufacturing industries, Exports |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2022-83&r= |
| By: | Juhana Hukkinen (Monetary Policy and Research Department of Bank of Finland); Matti Viren (Monetary Policy and Research Department of Bank of Finland & Economics Department of University of Turku) |
| Abstract: | This paper examines the reasons for the declining path of inflation since the 1970s. In particular, it focusses on the role of globalization â covering both changes in the global market structure and technical and structural developments in trade and production. In addition, the paper deals with changes in the basic transmission mechanisms of price and wage inflation. The paper makes use of different data from individual countries and panel of countries. These data show that the dispersion of inflation and the behavior of relative prices follow a pattern that is consistent with several globalization indicators. Also estimation results show that these indicators are useful in tracing the developments of trend inflation after the 1960s. Moreover, it is shown that the basic relationships between prices and costs are nonlinear depending on the level of inflation. |
| Keywords: | Inflation, globalization, Phillips curve, trade unions |
| JEL: | E31 E52 E58 F02 F41 F42 F62 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:tkk:dpaper:dp153&r= |
| By: | Sebastian Doerr; Dalia Marin; Davide Suverato; Thierry Verdier |
| Abstract: | This paper develops a novel theory of capital mis-allocation within firms that stems from managers' empire building and informational frictions within the organization. Introducing an internal capital market into a two-factor model of multi-segment firms, we show that competition imposes discipline on managers and reduces capital mis-allocation across divisions, thereby lowering the conglomerate discount. The theory can explain why exporters exhibit a lower conglomerate discount than non-exporters (a new fact we establish). We then exploit the China shock as an exogenous shock to competition to test the model's predictions with data on US companies. Results show that tougher competition significantly reduces managers' over-reporting of costs and improves the allocation of capital within firms. |
| Keywords: | multi-product firms, trade and organisation, internal capital markets, conglomerate discount, China shock |
| JEL: | F12 G30 L22 D23 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:1030&r= |
| By: | Georgieva, Daniela Ventsislavova; Gateva, Nedka; Georgieva, Teodora; Tsakova, Irina; Jukneviciene, Vita |
| Abstract: | The dynamic changes in the global environment have a strong impact on value chains in terms of both the economic and innovation performance of individual enterprises and the growth potential of the regions in which they are located. The main goal of the report is to analyse the innovation potential of furniture manufacturing companies in Bulgaria from the perspective of their global value chain (hereinafter GVC) participation. A review of the scientific literature is presented in the first part of the paper, where information regarding the current status, challenges, and opportunities for the innovativeness of the furniture industry is studied. In addition, factors related to the innovation potential of enterprises are outlined, which could have an impact on the GVC by strengthening and expanding their effect to gain new opportunities for national and regional competitiveness. Primary data analysis from a questionnaire survey among furniture manufacturing companies in Bulgaria is presented in the second part of the paper. Emphasis is put on the possibility for adaptation of the innovation potential of furniture manufacturers to the value chains and globalization. These analyses will serve as a basis for further studies on the link between innovativeness and GVC participation in forestry. |
| Keywords: | global value chain, furniture manufacturers, innovation potential |
| JEL: | O1 O30 Q0 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113979&r= |
| By: | Choe, Kyoungin; Goodwin, Barry K. |
| Keywords: | Research Methods/Statistical Methods, International Relations/Trade, Agricultural and Food Policy |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea22:322158&r= |
| By: | Hu, Zhepeng; Mallory, Mindy L. |
| Keywords: | Agricultural Finance, Agribusiness, International Relations/Trade |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea22:322090&r= |
| By: | Robinson,, John W. |
| Keywords: | International Relations/Trade, Resource/Energy Economics and Policy, Agricultural and Food Policy |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea22:322597&r= |
| By: | Li, Hongbin (Stanford University); Li, Lei (University of Mannheim); Ma, Hong (Tsinghua University) |
| Abstract: | China has witnessed rapid increases in the skill premium over the last few decades. In this paper, we study the short-run effect of capital goods imports on skill premium in China. The surge in capital goods imports, which embody advanced technology, can explain the rising demand for skills in China. We exploit regional variations in capital goods import exposure stemming from initial differences in import structure and instrument for the capital goods import growth using exchange rate movements. A city at the 75th percentile of the distribution of capital goods imports growth has a higher skill premium by 5 percentage points (0.38 standard deviation) over the one at the 25th percentile. To explore the underlying mechanism, we provide firm-level evidence and show that imported capital goods are skill-complementary. |
| Keywords: | imported capital goods, skill-biased technological change, skill premium |
| JEL: | F16 J20 J31 O33 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15423&r= |
| By: | HATTORI Takashi |
| Abstract: | Formulation of international norms, including their diffusion and acceptance, is part of the practice in international relations. However, the scholars have not paid adequate attention to the role of regional organizations and institutions in this process. The Asia-Pacific Economic Cooperation (APEC) has been one of the leading organizations in the Asia-Pacific region since its launch in 1989. This study examines the role of regional organizations in formulating international norms by examining APEC’s position in recent years. Three different international norms were chosen: (i) trade and investment liberalization, (ii) data-free flow with trust, and (iii) climate change governance. Actors in formulating international norms may involve governments, industries, civil societies/epidemic communities, and international organizations and institutions. The study examines how APEC, the APEC Business Advisory Council (ABAC), and the APEC Vision Group (AVG) have influenced the formulation of the aforementioned international norms. Through this examination, the study derives several points that are necessary for examining the relations between regional organizations and international norms. |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:22069&r= |
| By: | Edward Balistreri (UNL); Felix Baquedano (USDA ERS); John Beghin (UNL) |
| Abstract: | We analyze the impact of the COVID-19 pandemic and associated policy responses on the global economy and food security in 80 low- and middle-income countries. We use a global economy-wide model with detailed disaggregation of agricultural and food sectors and develop a business as usual baseline for 2020 and 2021 called “But-for-COVID” (BfC). We then shock the model with aggregate income shocks derived from the IMF World Economic Outlook for 2020 and 2021. We impose total-factor productivity losses in key sectors as well as consumption decreases induced by social distancing. The resulting shocks in prices and incomes from the CGE model simulations are fed into the USDA-ERS International Food Security Assessment model to derive the impact of the pandemic on food security in these 80 countries. The main effect of the pandemic was to exacerbate the existing declining trend in food security. Food insecurity increases considerably in countries in Asia through income shocks rather than prices effects. We also review trade policies that were put in place to restrict imports and exports of food, and we evaluate their potential for further disruption of markets focusing on the food-security implications. |
| Keywords: | Agricultural and Food Policy, International Relations/Trade |
| Date: | 2022–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:ags:nbaesp:323973&r= |
| By: | Bindseil, Ulrich; Pantelopoulos, George |
| Abstract: | The holy grail of cross-border payments is a solution allowing cross-border payments to be immediate, cheap, universal, and settled in a secure settlement medium. The search for such a solution is as old as international commerce and the implied need to pay. This paper describes current visions how to eventually find this holy grail within the next decade, namely through (i) modernized correspondent banking; (ii) emerging cross-border FinTech solutions; (iii) Bitcoin; (iv) global stablecoins; (v) interlinked instant payment systems with FX conversion layer; (vi) interlinked CBDC with FX conversion layer. For each, settlement mechanics are explained, and an assessment is provided on its potential to be the holy grail of cross-border payments. Several solutions are suitable for improving cross-border payments significantly, and some could even be the holy grail. JEL Classification: E42, E58, F31 |
| Keywords: | bitcoin, CBDC, correspondent banking, cross-currency payments, interlinking, stablecoins |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222693&r= |
| By: | SDIRI, Hanen |
| Abstract: | This study utilizes structural equation modeling (SEM) to analyze the extent to which environmental commitment and innovation increase the export intensity of Tunisian firms. Relying on firm-level data from the World Bank Enterprise Survey conducted in 2020, we empirically test how environmental commitment increases export intensity through innovation. This study distinguishes between two types of innovation; product innovation and process innovation. We show that environmental commitment is useful in stimulating both product and process innovation. We find that environmental commitment and product innovation drive exports. Yet, process innovation does not affect exports. Moreover, our results highlight that quality certification interacts with the relationship between environmental commitment and process innovation. The results can help decision-makers understand how environmental commitment represents an important strategy for companies to be more innovative and oriented towards export. |
| Keywords: | Product innovation. Process innovation. Environmental Commitment. Export intensity. Quality certification. Tunisian firms. |
| JEL: | F23 F63 F64 O3 |
| Date: | 2022–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113793&r= |
| By: | Pamela Pogliani; Philip Wooldridge |
| Abstract: | Financial centres that cater predominantly to non-residents – which we refer to as cross-border financial centres (XFCs) –are important intermediaries of cross-border financial flows. For analysing capital flows and international interconnectedness, it can be useful to distinguish countries that are home to XFCs from other countries. We improve on previous methodologies for identifying such centres by constructing a measure focussed on the intermediation activity inherent to XFCs and explicitly taking into account the non-normal distribution of this measure across countries when detecting outliers. We also minimise volatility in the set of countries identified as XFCs over time by de-trending the data and pooling years. Our methodology identifies a core set of 12 countries as XFCs over the 1995-2020 period, but the countries vary with time and different measures of activity. |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:1035&r= |