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on International Trade |
| By: | Beverelli, Cosimo; Gourevich, Isabella; Heiland, Inga; Keck, Alexander; Larch, Mario; Yotov, Yoto |
| Abstract: | The WTO Trade Facilitation Agreement (TFA) has been predicted to bring about an expansion in trade flows and real income gains. To date, there is still very limited empirical evidence on the actual post-implementation impact of the TFA. This paper provides an assessment, combining econometric estimations from a structural gravity model with general equilibrium modelling results. The main insight is that the TFA increased trade, in particular in agriculture, between developing countries that made commitments. General equilibrium estimations indicate that agricultural trade increases by 5% worldwide, while total trade increases by 1.17% worldwide as a result of TFA implementation. Trade gains accrue in particular to LDCs, whose exports increase by 2.4% overall (17% in agriculture). Furthermore, as a result of TFA implementation, real income increases by 0.12% worldwide (0.24% for LDCs). |
| Keywords: | Trade facilitation, Structural gravity, CGE models |
| JEL: | F13 F14 F17 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd202304&r=int |
| By: | Krantz, Sebastian |
| Abstract: | Using global Multi-Region Input-Output (MRIO) data from 2005-2015, this paper empirically investigates the extent and patterns by which East African Community (EAC) countries have integrated into Global Value Chains (GVCs) and Regional Value Chains (RVCs). Results imply that the foreign content of exports (I2E) and the share of exports being re-exported (E2R) are stably between 10% and 20% in most EAC countries. Trade in intermediates with the rest of the world remains 12-14 times greater in value-added (VA) terms than the trade in intermediates inside the EAC. During 2005-2015, Kenya expanded its role as a regional supplier of manufactured inputs (higher E2R with EAC partners), and Uganda slightly increased its agricultural input to the Kenyan and Rwandan food processing sectors. Overall, however, a downstream shift is evident, by which more VA (both domestic and foreign) is used for the production of final goods while maintaining high levels of exports in primary agriculture and mining. This shift goes alongside a loss of comparative advantage in manufacturing in all EAC countries apart from Kenya. Econometric analysis suggests that higher I2E and E2R shares increase GDP with an average elasticity of Ï 0.25 over 2 years. Estimates for manufacturing sectors were slightly higher at elasticities Ï 0.3 in response to E2R shifts. These results imply that policy measures to increase manufacturing competitiveness and promote more horizontal RVCs would benefit EAC economic growth in the medium run. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2242&r=int |
| By: | Lloyd, S. P.; Marin, E. A. |
| Abstract: | How does the conduct of optimal cross-border financial policy change with prevailing trade agreements? We study the joint optimal determination of trade policy and capital-flow management in a two-country, two-good model with trade in goods and assets. While the cooperative optimal allocation is efficient and involves no intervention, a country planner acting unilaterally can achieve higher domestic welfare by departing from free trade in addition to levying capital controls. However, time variation in the optimal tariff induces households to over- or under-borrow through its effects on the real exchange rate. In response to fluctuations where incentives for the planner to manipulate the terms of trade inter-and intra-temporally are aligned-e.g., the availability of domestic goods changes, or when faced with trade disruptions to imports-optimal capital controls are larger when used in conjunction with optimal tariffs. In contrast, when the incentives are misaligned, the optimal trade tariff partly substitutes for the use of capital controls. Accounting for strategic interactions, we show that committing to a free-trade agreement can reduce incentives to engage in costly capital-control wars. |
| Keywords: | Capital-Flow Management, Free-Trade Agreements, Ramsey Policy, Tariffs, Trade Policy |
| JEL: | F13 F32 F33 F38 |
| Date: | 2023–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2318&r=int |
| By: | Shahid, Kunwer Arsalan |
| Abstract: | One suitable way for Pakistan to develop its infrastructure can be attracting FDI in infrastructure development and maintenance. The developing world needs a massive increase in private sector involvement in infrastructure investments. Although after 2000 Pakistan has realized and focused on the opportunity, driven by foreign direct investment, areas that had traditionally been defined as public sector responsibilities benefited from substantial commitments of capital and resources. The World Bank Project Database indicates that an estimated total of 1, 707 private infrastructure projects worth US$458.2 billion were concluded from 1990 to end-1998. Foreign direct investment is the engine behind this development, with foreign investors involved in over 80 percent of transactions. During this period developing countries received an estimated US$138.3 billion in foreign direct investment from these infrastructure investments. Supported by a strong policy framework, private sector financing and operation of infrastructure facilities can result in significant efficiency gains while alleviating budgetary pressures. There is a startling gap between, allegedly, globalization-induced changes in international competition for foreign direct investment (FDI) and recent empirical evidence on the relative importance of determinants of FDI in developing countries. Traditional market-related determinants are still dominant factors. This paper analyzes the role of infrastructure availability in determining the attractiveness of countries for FDI inflows for export-orientation of MNE production. We posit that investments by governments in providing efficient physical infrastructural facilities improve the investment climate for FDI. MNEs may be particularly sensitive to infrastructure availability for locating their investments designed to feed the global, regional or home country markets. E.g. Transport infrastructure, telecommunications infrastructure, information infrastructure, energy availability for countries. The role of infrastructure in explaining the attractiveness for foreign production by MNEs, MNEs’ decision making pertaining to location of product mandates for global or regional markets sourcing is significantly influenced from infrastructure availability considerations. These findings suggest that infrastructure development should become an integral part of the strategy to attract FDI inflows in general, and export-oriented production from MNEs in particular. |
| Keywords: | FDI |
| JEL: | E0 |
| Date: | 2022–12–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116559&r=int |
| By: | Fabien RONDEAU; YOSHIDA Yushi |
| Abstract: | With internationally fragmented processes of production or global value chains, value-added components of a country’s export include the importer’s contributions as well as the contributions of third countries. The exchange rate sensitivity of export price reflects these value-added components. We examine the effect of value-added contributions of exporters and importers on the degree of exchange rate pass-through by focusing on the Japanese import prices by industry. Our results show that exchange rate pass-through increases for industries with a higher contribution of exporting countries’ value-added and for industries with a lower contribution of the importing country’s value-added. The differentials in value-added help explain the dynamics of exchange rate pass-through at the industry level. |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:23013&r=int |
| By: | Povilas Lastauskas (School of Business and Management, Queen Mary University of London.); Aurelija Proskute (Bank of Lithuania and Vilnius University); Alminas Zaldokas (Hong Kong University of Science and Technology (HKUST)) |
| Abstract: | We investigate how _rms adjust to the introduction of sudden, unanticipated and eventually long-lasting economic sanctions. We explore a unique event when, due to political reasons, unrelated to the underlying economic conditions, the exporters completely lost access to a major foreign market. In particular, in 2014 Russia introduced sanctions on imports from Europe, which caused an abrupt negative shock to the food production sector in Lithuania. We find that part-time employment is used as the first shock absorber, followed by investment and full-time employment. At the same time, firms dampen shock effects by expanding to other export markets. To rationalize this firm behavior, we provide a theoretical mechanism where forward-looking firms face nonconvexities in the labor market along with heterogeneous variable trade costs. |
| Keywords: | economic sanctions, firm adjustment margins, part-time employment, new export markets |
| JEL: | D22 D25 F14 F16 F51 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:cgs:wpaper:111&r=int |
| By: | Richard Frensch (IOS Regensburg); Jarko Fidrmuc; Michael Rindler |
| Abstract: | The gravity literature has focused on distance, borders and contiguity to measure geography’s impact on trade. We add value to this literature in terms of data, method and assessment of effects. First, we expand existing geographical databases by adding topographical features. We supply novel detailed primary data on the international European river network. We also construct a new indicator for the ruggedness of trade routes for more than a thousand European country pairs. Second, we introduce a new approach to differentiate between contemporaneous versus historical trade costs. Third, we assess the impact of topography on trade across Europe by applying two-stage structural gravity estimations, identifying bilateral trade costs on the basis of a worldwide panel of manufacturing trade including countries’ domestic trade. We show that positive effects of rivers on trade are less important – and also less persistent over time – than the negative effects of mountains. While border effect estimates remain largely robust against variations in topography, much of the historical – and all of the contemporaneous – trade costs usually attributed to non-contiguity can be accounted for by topography. Finally, counterfactual simulations for western (along the river Rhine) versus southeastern (along the river Danube) European countries suggest that historically topography may have contributed to the marginalization of southeastern Europe in European trade. |
| Keywords: | Gravity, geography, panel models |
| JEL: | C23 F15 F40 O18 |
| Date: | 2021–11 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:395&r=int |
| By: | Marta Santamaría; Jaume Ventura; Uğur Yeşilbayraktar |
| Abstract: | We use the new dataset of trade flows across 269 European regions in 24 countries constructed in Santamaria et al. (2020) to systematically explore for the first time trade patterns within and across country borders. We focus on the differences between home trade, country trade and foreign trade. We document the following facts: (i) European regional trade has a strong home and country bias, (ii) geographic distance and national borders are important determinants of regional trade, but cannot explain the strong regional home bias and (iii) the home bias is heterogeneous across regions and seems to be driven by political regional borders. |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1860&r=int |
| By: | Ana Maria Santacreu (Federal Reserve Bank of St. Louis); Michael Sposi (Southern Methodist University); Jing Zhang (Federal Reserve Bank of Chicago) |
| Abstract: | We develop a structural framework to identify the sources of cross-state heterogeneity in response to US tariff changes. We quantify the effects of unilaterally increasing US tariffs by 25 percentage points across sectors. Welfare changes range from -0.8 percent in Oregon to 2.1 percent in Montana. States gain more when their sectoral comparative advantage covaries negatively with that of the aggregate US. Consequently, ``preferred'' changes in tariffs vary systematically across states, indicating the importance of transfers in aligning state preferences over trade policy. Foreign retaliation substantially reduces the gains across states while perpetuating the cross-state variation. |
| Keywords: | Interstate trade, Gains from trade, Customs union. |
| JEL: | F11 F62 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:smu:ecowpa:2302&r=int |
| By: | Federico Esposito; Fadi Hassan |
| Abstract: | We analyze the role of trade credit and financial frictions in the propagation of international trade shocks along the supply chain. First, we show empirically that exposure to import competition from China increased the use of trade credit in the U.S. Then, we use a multi-country input-output trade model with borrowing constraints, trade credit, and endogenous employment to quantify the general equilibrium effects of such increase, characterizing the different channels at work. Borrowing constraints amplify the negative consequences of the China shock on employment, but introducing trade credit reduces these losses by 8%-27%, depending on the tightness of the constraints. |
| Keywords: | trade credit, trade shocks, financial frictions, borrowing constraints, employment |
| Date: | 2023–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1901&r=int |
| By: | Paula Pereda; Andrea Lucchesi, Thais Diniz, Rayan Wolf |
| Abstract: | We discuss the impact of a carbon tax on the maritime transport sector, which is responsible for approximately 3% of global emissions. The International Maritime Organization (IMO) has set long-term targets to reduce carbon intensity and achieve carbon neutrality, but the impact of the policies to achieve those targets on the global and local economies must be assessed. We use a global and multi-region Computable General Equilibrium (CGE) model - Global Trade Analysis Project Energy-Environmental augmented version (GTAP-E) – to evaluate the environmental and economic effectiveness of a carbon tax of $50/tCO2e on international shipping. GTAP-E does not provide emissions data by transport mode and accurately estimating emissions is crucial to proposing a carbon pricing measure. Therefore, we have applied machine-learning techniques to predict the share of international trade transported by sea by sector, origin and destination countries and calculate ship emissions for each bilateral flow by sector. The findings indicate that while the tax considerably reduced emissions from ships, it also had a negative impact on exports and resulted in mixed impacts on GDP, exacerbating existing inequalities across regions. Our analysis highlights the importance of considering various economic and social variables in impact assessments to identify potential trade-offs and synergies between policy objectives. |
| Keywords: | Carbon Pricing; Carbon Tax; Shipping; Computable General Equilibrium |
| JEL: | Q52 R48 F17 Q56 |
| Date: | 2023–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:spa:wpaper:2023wpecon4&r=int |
| By: | Das, Gouranga G.; Maswana, Jean-Claude; Hirano, Yumeka |
| Abstract: | Drawing on selective stylized facts, the paper evaluates the growth-effects for African countries and the disruptive potentials resulting from the COVD-19 pandemic, as African countries are involved in intra-regional integration processes. As AfCFTA involving 55 countries (ratified by 22 countries) is an ambitious project for industrialization for achieving SDG targets of inclusive development via trade facilitation, and regional integration, the paper argues that given the Covid-19 setback full potential depends on trade-led spillover benefits and structural factors. Our objective is to show that: given the low labor-productivity growth in the African nations-without reinventing the wheel by estimating the impact of preferential access trade agreement--the ricochet effect of the trade-induced productivity benefits via intermediates in the presence of COVID-19-led trade disruptions is crucial. The study highlights the role of trade-growth-structural factors for providing basis to simulate scenarios of technology-imports contents in a global non-linear CGE model, viz., Global Trade Analysis Project (GTAP) with 27 sectors and 51 regions. The paper shows: (i) role of trade-mediated productivity benefits for facilitating regional supply chain, (ii) factors underlying absorption of such benefits for economic transformation; (iii) how trade and technology could boost trade not just trade-liberalization per se; (iv) given the region's weaker production basis, in the presence of Covid-19, how the risks posed by trade plus non-trade external shocks to African intra-regional integration matter. Findings also indicate that technological benefits due to trade liberalization under FTA may be hindered by non-trade factors like epidemic or pandemic resulting in skill deficiencies, and translating into productivity slowdown. The paper empirically shows that for realizing the enormous potential of AfCFTA as driver of industrialization deep policy reforms in the areas of technology, absorptive capacity, institutions, and infra- and info-structure for digitization are necessary for long-term development. Also, the result proves that: for effectiveness of AfCFTA to deliver benefits to poor countries via allocative efficiency and welfare, apart from improving the 'behind-the-border' factors, trade with not only emerging economies like China, but also with industrialized nations is important. Also, the research shows the necessity of formulating policies to develop targeted sectors for reaping substantial benefits via AfCFTA. Thus, AfCFTA is not a panacea for industrial development. |
| Keywords: | Total Factor Productivity, AfCFTA, Industrialization, Covid-19, Pandemic, Human capital, Inclusive Growth, China-shock, CGE, GTAP, Spillover, Digitization, Trade |
| JEL: | O24 I15 R13 D58 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1251&r=int |
| By: | Upalat Korwatanasakul |
| Abstract: | The study provides a novel analysis through the lens of the global value chain (GVC) framework with empirical data of trade in value added, which has not been explored much in the literature, to explain the issue of the middle-income trap in the context of Thailand by matching GVC data at the firm, industry, and country levels with the economic development path. The findings support the previous studies that GVC participation helps induce initial industrialisation and economic development. However, it does not guarantee technological upgrading at a later stage due to the risk of falling into the middle-income technology trap (MITT). Thailand depends heavily on passive technology and specialisation given by headquarter economies, which lock the country in the middle of value chains with limited knowledge and technology transfer. As a result, the country fell into the MITT. The MITT, together with other confounding factors, such as eroding competitiveness in labour-intensive production, made Thailand unable to sustain its growth and catch up with more innovative advanced economies and, in turn, fell into the middle-income trap. To escape from both traps, the government may consider policies that can deal with the issues of insufficient knowledge and technology transfer and a lack of local firms’ capacities as they are the primary causes of the limited upgrading. In addition, the study manifests the necessity of a contextual analysis at the industry level to understand value-added components and the importance of the quality of domestic value added sources. |
| Keywords: | Economic development; Global value chain (GVC); GVC participation; Middle-income trap; Thailand |
| JEL: | F13 F14 L25 O24 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:pui:dpaper:202&r=int |
| By: | Feicheng Wang (University of Göttingen); Zhe Liang; Hartmut Lehmann |
| Abstract: | This paper investigates the effects of trade liberalisation induced labour demand shocks on informal employment in China. We employ a local labour market approach to construct a regional measure of exposure to import tariffs by exploiting initial differences in industrial composition across prefectural cities and then link it with the employment status of individuals. Using three waves of household survey data between 1995 and 2007, our results show that workers from regions that experienced a larger tariff cut were more likely to be employed informally. Further results based on firm-level data reveal a consistent pattern; tariff reductions increased the share of informal workers within firms. Such effects are more salient among smaller and less productive firms. Our findings suggest an important margin of labour market adjustment in response to trade shocks in developing countries, i.e. employment adjustment along the formal-informal dimension. |
| Keywords: | Trade liberalisation; Import competition; Informal employment; Firms; China |
| JEL: | F14 F16 F66 J46 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:392&r=int |
| By: | MAKIOKA Ryo |
| Abstract: | This paper analyzes the effects of the JAPAN MALL project, a project by the Japan External Trade Organization (JETRO) to support Japanese firms that are engaged in selling products overseas using foreign e-commerce (EC) platforms. JETRO introduces Japanese firms to foreign EC platforms, and their products will then be posted on the online EC website if the negotiations between the Japanese firms and the foreign EC platforms are concluded. In addition, the Japanese firms can deliver their products to domestic trading firms that will then export these products to foreign EC platforms, thus reducing their transaction costs (e.g., handling customs clearance, international logistics, and etc.). To analyze the effects, we take a difference-in-differences approach and use a dataset merging the list of Japanese firms that are introduced by JETRO to foreign EC platforms with information on firms from the Basic Survey of Japanese Business Structure and Activities (BSJBSA) by the Ministry of Economy, Trade and Industry (METI). The results show significant pre-trends between supported and non-supported firms, suggesting that it does not satisfy a necessary identification assumption. |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:23012&r=int |
| By: | Pregaldini, Damiano (University of Zurich); Backes-Gellner, Uschi (University of Zurich) |
| Abstract: | Our study explores the effects of immigration on the employment of native middle-skilled workers, focusing on how this effect varies with the specificity of their occupational skill bundles. Exploiting the 2002 opening of the Swiss labor market to EU workers and using register data on the location and occupation of these workers, our findings provide novel results on the labor market effects of immigration. We show that the inflow of EU workers led to an increase in the employment of native middle-skilled workers with highly specific occupational skills and to a reduction in their occupational mobility. These findings can be attributed to immigrant workers reducing existing skill gaps, enhancing the quality of job-workers matches, and alleviating firms' capacity restrictions. This allowed firms to create new jobs, thereby providing increased employment options for middle-skilled workers with highly specialized skills and reducing the need to change their occupations. This research provides novel insights on the impact of immigration on the labor market. |
| Keywords: | migration, cross-border workers, occupational skill specificity |
| JEL: | J15 J24 J62 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15957&r=int |
| By: | Muhammad Zeshan (Pakistan Institute of Development Economics) |
| Abstract: | The national tariff policy in Pakistan emphasizes on the gradual elimination of tariffs on imported raw materials, and intermediate products. Moreover, the cascading principle suggests a lower import tariff rate on raw materials compared to the final output. However, this principle deviates in Pakistan, where a product is used as input in a sector but is considered an output in another sector. Various factors add to this distortion such as favoritism in protection policy, political economy and rent-seeking behavior by many firms (Nasir, 2020). |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pid:kbrief:2022:87&r=int |
| By: | Svilena Mihaylova (University of Economics Ð Varna) |
| Abstract: | Given the important role of foreign direct investment in Central and Eastern Europe, the paper explores the performance of foreign affiliates versus domestic firms in the information and communication services sector in eleven countries in the region. Based on Eurostat data for the period 2010-2020, the paper conducts descriptive and comparative analysis of foreign-owned and domestic firms in terms of size, productivity and profitability, as well as their dynamics over time. The results reveal that, on average, foreign-owned firms in the sector tend to be bigger and perform better than their local counterparts, but in the same time there are significant variations across countries. |
| Keywords: | Firm performance; Foreign direct investment; Multinational enterprises |
| JEL: | L25 F21 F23 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:sko:wpaper:bep-2023-04&r=int |
| By: | Muhammad Zeshan (Pakistan Institute of Development Economics) |
| Abstract: | Due to the import substitution policy, domestic firms and end users have to pay a higher price for the imported intermediate inputs, and final consumption items compared to the international market prices. The data show that the use of imported intermediate inputs has increased in agriculture, manufacturing, and services sectors over the last two decades in Pakistan. Clearly, the import substitution policy is unable to meet its primary objectives of substituting expensive imported items for cheaper domestic intermediate and final consumption items rather it is leading toward an unsustainable economic environment for domestic and international trade. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pid:kbrief:2022:98&r=int |
| By: | Jean Imbs; Laurent Pauwels |
| Abstract: | We propose a data-based approximation of the effects of trade sanctions. We validate the approximation by comparing it with exact responses simulated from a canonical multi-country multi-sector model. The approximation is palatable for a broad range of elasticities of substitution, except for extremely low ones. It is based on a decomposition of high order trade according to destination or inputs markets and can readily be computed on the basis of international input-output data. As such it provides a practical shortcut to evaluating the consequences of trade sanctions without having to make difficult calibration choices. We implement our approximation to evaluate the consequences of trade sanctions between Europe and Russia. Our approximated effects are within the range of existing estimates, but they mask vast asymmetries. First, the effects of sanctions are about fifteen times larger on Russia than on Europe. Second, the effects within Europe are enormously asymmetric, with much larger consequences on ex-“satellite†countries of the Soviet Union than on large Western European economies. We then adapt our approach to show that the most affected European countries do not typically have access to substitute markets and are in fact highly dependent on Russia. We show that this extreme dependence on Russia is at least partly explained by the existence of specific energy transporting infrastructure (pipelines) that appear to constrain tightly the production of electricity in those heavily affected East European economies. These findings illustrate the practical potentiality of our approximation in a variety of different contexts. |
| Keywords: | European Energy Imports, Russian Sanctions, Economic Consequences of Sanctions, Global Value Chain |
| JEL: | F14 F42 F51 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2023-16&r=int |
| By: | Barsbai, Toman; Steinmayr, Andreas; Winter, Christoph |
| Abstract: | We analyze the impact of economic conditions at arrival on the economic integration of family-sponsored migrants in the U.S. A one pp higher unemployment rate at arrival decreases annual wage income by four percent in the short run and two percent in the longer run. The loss in wage income results primarily from lower hourly wages due to occupational downgrading. Migrant and family networks help mitigating the negative labor market effects. Migrants who arrive during a recession take up occupations with higher concentrations of fellow countrypeople and are more likely to reside with family members, potentially reducing their geographical mobility. |
| Keywords: | Immigrant integration, family reunification, chain migration, migrant networks, labor market, business cycle |
| JEL: | E32 F22 J31 J61 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2240&r=int |
| By: | Ileana Raquel Jalile |
| Abstract: | This paper constitutes an improved and upgraded version of a research in progress whose main purpose is to examine the impact of macroeconomic fluctuations on the application of new import restrictive measures for Argentina over the years 1989–2019. It uses quarterly available data for Argentina to estimate the impact of macroeconomic shocks and exchange rate movements on protectionist policies over the analyzed period. While part of the empirical literature in this latitude is devoted to the analysis of the primary determinants of such protectionist measures, there is not any domestic effort linking the imposition of new import restrictions to macroeconomics shocks as we shall explore in this paper. I consider this analysis is important because we can better address the relationship between business cycles, exchange rates and import restriction and capture the precise timing of any trade policy changes taking place during the cycles of the businesses. |
| JEL: | F13 F14 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4570&r=int |
| By: | Aggarwal, Sakshi |
| Abstract: | Machine learning (ML) is the scientific study of algorithms and statistical models that computer systems use to perform a specific task without being explicitly programmed. It is one of today’s most rapidly growing technical fields, lying at the crossroads of computer science and statistics, and at the core of artificial intelligence (AI) and data science. Various types of machine learning algorithms such as supervised, unsupervised, semi-supervised, and reinforcement learning exist in this area. Recent progress in ML has been driven both by the development of new learning algorithms theory, and by the ongoing explosion in the availability of vast amount of data (commonly known as “big-data”) and low-cost computation. The adoption of data-intensive ML-based methods can be found throughout science, technology, and commerce, leading to more evidence-based decision-making across many walks of life, including finance, manufacturing, international trade, economics, education, healthcare, marketing, policymaking, and data governance. The present paper provides a comprehensive view on these machine learning algorithms that can be applied to enhance the intelligence and capabilities of an application. Moreover, the paper attempts to determine the accurate clusters of similar industries in United States that collectively account for more than 85 percent of economy’s aggregate export and import flows over the period 2002-2021 through clustering algorithm (unsupervised learning). Four clusters of mapping labels have been used, namely the low investment (LL), category 1 medium investment (HL), category 2 medium investment (LH) and high investment (HH). The empirical results indicate that machinery and electrical equipment is classified as a high investment sector due to its efficient production mechanism. The analysis further underlines the need for upstream value chain integration through skill-augmentation and innovation especially in low investment industries. Overall, this paper aims to explain the trends of ML approaches and their applicability in various real-world domains, as well as serve as a reference point for academia, industry professionals and policymakers particularly from a technical, ethical, and regulatory point of view. |
| Keywords: | Machine learning, Artificial intelligence, Clustering, K-means, international trade |
| JEL: | F14 |
| Date: | 2023–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116579&r=int |
| By: | Christophe C. Gouel (CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, ECO-PUB - Economie Publique - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique); David Laborde (IFPRI - International Food Policy Research Institute [Washington] - CGIAR - Consultative Group on International Agricultural Research [CGIAR]) |
| Abstract: | Climate change effects on agricultural yields will be uneven over the world. A few countries, mostly in high latitudes, may experience gains, while most will see average yield decrease. This paper aims to quantify the role of market-mediated adjustments in attenuating the effects of climate change by allowing the expression of the new climate-induced pattern of comparative advantages within and between countries. To do this, we develop a quantitative general equilibrium trade model where the representation of land use choice is inspired from modern Ricardian trade models. We use spatially explicit information from the agronomic literature about potential yields before and after climate change for calibration and counterfactual simulations. The results show that the climate-induced yield changes generate large price movements that incentivize adjustments in production and trade. Both production and trade adjustments contribute to reducing welfare losses globally, with production adjustments making the larger contribution. |
| Abstract: | Les effets du changement climatique sur les rendements agricoles seront hétérogènes dans le monde. Quelques pays, principalement dans les latitudes élevées, pourraient bénéficier de gains, alors que la plupart devraient avoir des pertes de rendement. Cet article a pour but de quantifier le role des ajustements médiés par le marché dans l'atténuation des effets du changement climatique en permettant l'expression des nouveaux avantages comparatifs induits par le climat. Pour faire cela, nous développons un modèle quantitif d'équilibre général dans lequel la représentation des choix d'usage des sols est inspirée des modèles de commerce ricardien modernes. Nous utilisons des informations spatialement explicites provenant de la littérature agronomique sur les rendements potentiels avant et après changement climatique pour le calibrage et pour les simulations contrefactuelles. Les résultats montrent que les changements de rendement induits par le climate génèrent d'importants changements de prix qui créent des incitations à ajuster la production et le commerce. Les ajustements de production et de commerce contribuent tous les deux à réduire les pertes de bien-être au niveau mondial, les justements de production contribuant le plus. |
| Keywords: | Adaptation, Agriculture, Climate change, International trade, Land use, Commerce international, Usage des sols, Changement climatique |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03116428&r=int |
| By: | Matías Ciaschi; Andrés César; Guillermo Falcone; Guido Neidhöfer |
| Abstract: | There is a large body of literature studying the effects of trade shocks on worker’s job and wage losses. However, little is known about whether these effects transmit into the next generation. In this paper, we exploit the increased Chinese import competition in Brazil to evaluate how this shock affected children of exposed fathers. We use an specific survey module containing precise retrospective questions on parental employment and education, among other characteristics. Our findings suggest that children from more exposed fathers have less education and earnings in their adulthood. We also find a higher likelihood of having and informal or operational employment and social assistance dependence. Importantly, these effects are larger for children from low socioeconomic backgrounds, suggesting that the trade shock decreased intergenerational mobility and accentuated poverty traps. |
| JEL: | I24 J62 F14 F16 J23 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4551&r=int |
| By: | Braiton, Nombulelo; Odhiambo, Nicholas M |
| Abstract: | Purpose ? The purpose of the paper is to examine macroeconomic and institutional factors that influence capital flows to low-income sub-Saharan African (SSAn) countries. It analyzes capital flows in a disaggregated manner: foreign divert investment, portfolio equity and portfolio debt. There is a gap in the empirical literature in examining the factors that are important for various types of capital flows to low-income SSAn countries. Low-income SSAn countries attract very low levels of foreign investment compared to other developing economies in the SSAn region and other developing economies and this paper attempts to make a contribution in this area.Design/methodology/approach ? This paper examines data on capital flows and that of various push and pull factors. Trends and dynamics of capital inflows and their macroeconomic and institutional drivers are analyzed for low-income sub-Saharan African countries. Such an analysis has not been fully explored for low-income SSAn countries.Findings ? Capital inflows to low-income sub-Saharan Africa (SSA) have increased sevenfold since the 1990s, dominated by foreign direct investment (FDI). They overtook official development assistance and aid in the 2010s. Mozambique and Ethiopia attract the largest size of FDI compared to other low-income SSAn economies, with natural resources as key factors in the former. The largest share of FDI to low-income SSAn countries comes from other SSAn countries, mostly South Africa and Mauritius. Among macroeconomic push factors, capital inflows are more closely related to commodity prices, while the volatility index and global liquidity are also important. Among macroeconomic pull factors, trade openness and economic growth appear more closely related to capital inflows. The surge in capital inflows in the 2000s also followed the implementation of several regional trade and investment agreements in the region. The improvement in internal conflict in the 1990s and mid-2000s seems to have helped support the increase in capital inflows during that period. This institutional quality variable appears to more closely track capital inflows compared to other institutional quality indicators.There were also improvements in the investment profile, law and order, and government stability in the 1990s to early 2000s when capital inflows picked up.Research limitations/implications ? This study focuses on low-income SSAn countries, which are less studied in the empirical literature and that face immense developmental needs that require foreign and domestic capital.Practical implications ? Findings of this paper can shed light to policy makers on the factors that are most important to help the region attract capital inflows and areas where further improvement is needed in the macroeconomic and institutional environment.Originality/value ? There is a gap in the empirical literature in examining the factors that are important for attracting capital flows to low-income SSAn countries. To our knowledge, this study may be the first to explore dynamics of capital flows against institutional quality for low-income SSAn countries at a disaggregated level. |
| Keywords: | Capital inflows, Foreign direct investment, Portfolio equity, Portfolio debt, Low-income sub-Saharan Africa |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:uza:wpaper:29831&r=int |
| By: | Reinhard Ellwanger; Hinnerk Gnutzmann; Piotr Śpiewanowski |
| Abstract: | Commodity markets are linked through international trade but are separated by heterogeneous regulations and input markets. We investigate theoretically and empirically how regional, as opposed to global, cost shocks pass through into global prices. Capacity constraints mitigate the output response to regional cost shocks in the short run. Once constraints bind, the pass-through of a cost increase is enhanced while for cost decreases it drops to zero. We study the market for ammonia, a commodity produced largely from natural gas, to highlight the nonlinearity of the cost pass-through and its implications for unilateral climate policies. |
| Keywords: | Climate change; Econometric and statistical methods; Inflation and prices; International topics |
| JEL: | L13 L65 Q54 Q40 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:23-16&r=int |
| By: | Abdul Karim, Madiha |
| Abstract: | This research report is concerned regarding to find out the factors, policies and strategies that the Pakistani textile exporters should implement in their efficient and effective working operations in order to create and achieve the competitive advantage over its value added (garments and knitwear) textile industry. So due to this, they can deliver this sort of scale, high quality garments and can serve all parts of the European market successfully. As we know that Pakistan’s textile industry is one of the leading textile industry among the other key textile players of the world and the leading sector in the economy of Pakistan. The previous and current data shows that throughout the years, Pakistan has continuously increasing its textile exports and if we emphasize on the value-added products like garments, hosiery, knit wears and other textile made-ups, the export volume of textile can be increase by manifold. After the Jan 1, 2005 in which the WTO has provided the quota free regime to Pakistan and has imposed the quota on China. Now by imposing the quota on China, there is definitely the opportunity for Pakistan so now this is the ability of Pakistani textile exporters that how they can use it and completely avail such kind of remarkable opportunity. For this purpose, the questionnaire has been developed which has been administered by the key personnel of 10 textile industries of Pakistan. The questionnaire has the questions which have given the information about current position and problems faced by textile exporters in this sector and also the rules and policies by Export Promotion Bureau regarding the textile exports of Pakistan. |
| Keywords: | Export-Free Regime |
| JEL: | M0 |
| Date: | 2023–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116554&r=int |
| By: | Marcus Biermann; Elsa Leromain |
| Abstract: | We study how firms' international linkages to Russia and Ukraine have affected investors' expectations following the outbreak of the Russian-Ukrainian war. We perform an event study around the Russian invasion into Ukraine on February 24, 2022. We find that having trade linkages to Russia in the top decile is associated with a decrease in the cumulative return by 2.16 percentage points and having an affiliate in Russia with a decrease by 3.12 percentage points. Having an affiliate in Ukraine has, however, no effect on firms' stock market returns. The total impact of trade linkages on the aggregate stock market performance of third countries was on average 0.8 percentage points and of multinational linkages was on average 0.73 percentage points. The losses were largest in European countries. |
| Keywords: | Russia-Ukraine war, trade linkages, multinationals, stock market, event study |
| Date: | 2023–01–26 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1899&r=int |
| By: | Nicola Daniele Coniglio; Vitorocco Peragine; Davide Vurchio |
| Abstract: | In this paper we explore the links between international migration and income inequality. After presenting a simple model which considers the role of income distribution in individual decisions to migrate, we estimate a set of models on the determinants of yearly bilateral migration from a very large pool of countries in the period 1960-2019. The empirical results confirm that inequality—in both origin and destination countries—significantly shapes individual choices about where, and whether, to migrate. |
| Keywords: | International migration, Income inequality, Income distribution, Inequality |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2023-41&r=int |
| By: | Fabrizio Leone |
| Abstract: | Using a panel of Spanish manufacturing firms covering the 1990-2017 period, I show that firms acquired by multinational enterprises start investing in industrial robots, which leads to a reduction of the labor share at the firm and industry levels. The results are explained by a model of robot adoption and are robust to accounting for selection into multinational ownership. The estimates imply that, without multinationals and robots, the manufacturing labor share would be at its level of two decades ago. These findings shed new light on how globalization and technological change jointly shape the decline in the labor share. |
| Keywords: | multinational enterprises, industrial robots, labor share, globalization, technological change |
| Date: | 2023–02–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1900&r=int |
| By: | Ms. Margaux MacDonald; Antonis Kotidis; Dimitris Malliaropulos |
| Abstract: | Banks guarantee international trade through letters of credit. This paper analyzes what happens to trade when the critical role of banks as trade guarantors is compromised. Using the case of the Greek capital controls in 2015, the events around which led to a massive loss of confidence in the domestic banking system, we show that firms whose operations were more dependent on domestic banks suffered a steep decline in imports and, subsequently, exports. This operated through letters of credit, which during the capital controls period had to be backed by firms’ own cash collateral rather than the bank guarantee. As a result, cash-poor firms imported relatively less. Public intervention to guarantee transactions is shown to help mitigate some of the decline in imports. |
| Keywords: | Bank guarantee; letters of credit; imports; exports; capital control; trade guarantor; cash-poor firm; outflow control; log letters of credit; bank intermediation channel; Capital controls; Credit; Commercial banks; Capital outflows; Asia and Pacific |
| Date: | 2023–02–24 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2023/038&r=int |
| By: | Eskander, Shaikh M.S.U.; Fankhauser, Sam |
| Abstract: | We analyse the international impact on carbon emissions from national climate legislation in 111 countries over 1996–2018. We estimate trade-related carbon leakage, or net carbon imports, as the difference between consumption and production emissions. Legislation has had a significant negative and roughly similar impact on both consumption and production emissions. The net impact on trade-related emissions is therefore not statistically significant, neither in the short term (laws passed in the last 3 years) nor the long term (laws older than 3 years). We find a significant negative long-term impact on domestic emissions from laws passed by trade partners. This latter specification corresponds to the traditional definition of carbon leakage. Overall, we conclude that there has been no detrimental effect of climate legislation on international emissions. |
| Keywords: | carbon leakage; climate change legislation; climate policy; consumption emissions; production emissions; technology spillovers |
| JEL: | F18 K32 Q54 Q56 Q58 |
| Date: | 2023–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:118331&r=int |
| By: | Syed Naimul, Wadood; Nayeema Nusrat, Choudhury; Abul Kalam, Azad |
| Abstract: | This is a primer review of international migration theory and international migration from Bangladesh. We first present a review of the theory of international migration. Regarding international migration from Bangladesh, we note that by the middle of 2020, about 7.4 million people of Bangladesh origin were staying overseas, the sixth-largest worldwide and second-largest in South Asia. Yet there are concerns about illegal human trafficking and smuggling of undocumented workers. Recently there has been the COVID-19 pandemic, starting from the end of 2019 to date. Bangladesh international migration ground realities are often uncertain and challenging, with new situations emerging now and then in many different host countries. In summary, we argue that recent models of migration theory (circular, onward and return migration models) have successfully incorporated issues of international migration from large source countries, such as Bangladesh. |
| Keywords: | international migration theory, NELM, short-term contract labour migration, circular migration, COVID-19 fallouts, Bangladesh |
| JEL: | D1 J6 J61 |
| Date: | 2023–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116611&r=int |
| By: | Dobbelaere, Sabien (Vrije Universiteit Amsterdam); Fuss, Catherine (National Bank of Belgium); Vancauteren, Mark (Universiteit Hasselt and Statistics Netherlands) |
| Abstract: | We study the relationship between offshoring and the prevalence and intensity of labor market imperfections at the firm level in Belgium and the Netherlands. Wage-markup pricing stemming from workers' monopoly power is more prevalent than wage-markdown pricing originating from firms' monopsony power in both countries. Offshoring benefits firms in that imports of final as well as intermediate goods are associated with a higher prevalence and intensity of wage markdowns. The widening effect of offshoring on wage markdowns arises from an increase in productivity that is only imperfectly passed through into an increase in wages. Offshoring is negatively related to the prevalence of wage markups. This also holds for the intensity of wage markups measured by workers' bargaining power in Belgium. |
| Keywords: | wage markdowns, wage markups, firm-level offshoring |
| JEL: | F14 F16 J42 J50 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15962&r=int |
| By: | TANAKA Kiyoyasu |
| Abstract: | Inward foreign direct investment can contribute to the Japanese economy. However, there remains a question as to whether mergers and acquisitions (M&A) by foreign firms can improve business conditions for the acquired Japanese firms. To estimate the causal impact of foreign M&A on Japanese firms, this paper constructs a new panel dataset for the period 2000-2019 by linking the Survey of Trends in Business Activities of Foreign Affiliates with the Basic Survey of Business Structure and Activities. Specifically, this paper examines the impact of foreign M&A on sales, profits, and employment of Japanese firms and investigates the characteristics of acquired Japanese firms. A propensity-score weighting regression is employed to address a selection issue by foreign firms. My panel data include the firms that survived as corporate entities subsequent to the acquisition, but do not cover the firms that are merged by foreign investors and the business divisions that were carved out. The results show that sales, profits, and employment of acquired Japanese firms tend to decrease after foreign M&A. Acquired Japanese firms in non-manufacturing sectors can increase their sales, suggesting that it is crucial to further investigate the underlying conditions for which foreign M&A improves the business conditions. |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:23011&r=int |
| By: | Ivlevs, Artjoms (University of the West of England, Bristol); Smith, Ian (University of the West of England, Bristol) |
| Abstract: | Can international tourist arrivals change residents' attitudes towards immigrants and immigration? We discuss possible underlying mechanisms and provide the first evidence on this question using data from the European Social Survey (2002-2019; n=333, 505). We find that, as tourist arrivals grow, residents become more positive towards immigration in Eastern Europe. In Western Europe, the relationship tends to turn from positive to negative at relatively high levels of tourism. The instrumental variable analysis suggests that incoming tourism has a positive causal effect on attitudes towards immigration in both Western and Eastern Europe. Overall, our study reveals an overlooked dimension of the tourism-migration nexus and highlights the role that international tourism may play in shaping attitudes towards immigration and, through these attitudes, immigration policy and flows, immigrant integration and more open and inclusive societies in tourism-receiving countries. |
| Keywords: | tourism, attitudes towards immigration, inclusion, Europe, instrumental variable analysis |
| JEL: | J61 L83 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15953&r=int |
| By: | Uzma Zia (Pakistan Institute of Development Economics) |
| Abstract: | Pakistan has performed in local hand set manufacturing and has gradually become exporter of mobile phones. Being a new product for exports, no specific export targets were set before but the “domestic increase in production of handsets” and “initiating export successfully” is encouraging. The local mobile phone manufacturing industry is expected to promote Pakistan’s in-house handset manufacturing, exports, the digital economy through providing mobile services particularly in the form of mobile broadband and hence; enhancing digital connectivity, ecosystem & innovation. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pid:kbrief:2022:79&r=int |
| By: | Isabelle Tsakok |
| Abstract: | Rwanda is famous for its remarkable socio-economic performance after the ravages of the Genocide against the Tutsis and moderate Hutus in 1994. Under the leadership of President Paul Kagame, Rwanda has followed a state-led development model with stunning results. Despite these substantial accomplishments, Rwanda is still a low-income country with extensive poverty. Its agriculture is still of low productivity and highly vulnerable to climate change. Structural transformation has weakened as the rate of growth, job creation, and poverty reduction have slowed down. Food security is still a distant dream for millions. Agriculture must successfully transform, 1 if Rwanda is to realize its ambitious Vision 2035 of reaching middle-income country status and Vision 2050 of reaching high-income status. Rwanda’s state-led approach to focusing on food self-sufficiency as agricultural transformation has had good results but the approach is fast encountering diminishing returns. Instead, a holistic approach to agricultural transformation is required: an approach that embraces a more significant role for the private sector with access to expanding, lucrative, and competitive markets. In an era when geo-political tensions exacerbate supply chain disruptions, the African Continental Free Trade Agreement (AfCFTA) offers Rwanda the regional market opportunities it needs to power its structural transformation. |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ocp:ppaper:pb51-22&r=int |
| By: | Daniel Rees |
| Abstract: | In the aftermath of the Covid pandemic rising commodity prices went hand-in-hand with a strengthening US dollar. This was a sharp contrast to the usual relationship between commodity prices and the dollar. This paper presents evidence that post-Covid correlation patterns could become more common in the future. This conclusion rests on two observations. First, the US dollar exhibits a close and stable relationship with the US terms of trade. Second, the United States' shift from being a net oil importer to a net oil exporter means that higher commodity prices now tend to raise the US terms of trade, rather than lowering them. Changes in the relationship between commodity prices and the US dollar will have implications for commodity exporters and importers alike. |
| Keywords: | time series models, foreign exchange, open economy macroeconomics |
| JEL: | C22 F31 F41 |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:1083&r=int |
| By: | Das, Gouranga G.; Ginting, Edimon; Horridge, Mark; Yamano, Takashi |
| Abstract: | Kyrgyzstan economy have undergone transition from a different economic system in the 1990s until now. For stimulating a diversified long-run growth in Kyrgyzstan, the region needs to overcome spatial fragmentation by integrating the regions for economic development translating into national growth, and wider welfare gains. For sustained basis and shared prosperity, several policies are necessary for reforming basic services, human development, connectivity via infrastructure, industrial as well as agricultural performance, and a conducive business environment. In this paper, we assess the potential impacts of selected structural reform measures using a newly developed comparative-static forecasting model tailored to suit Kyrgyzstan economy--a computable general equilibrium (CGE) model (KGZORANI)-with a detailed Input-Output table for 34 sectors, and SAM of the national economy as of 2015. Economy is disaggregated into 9 regions. The reform initiatives are designed for enhancement of productivity and efficiency in agriculture, services such as trade, tourism, and transport, logistics, some manufacturing for industrialization, as well as power and energy sector like electricity, and global integration via trade and FDI. Policy reform simulation demonstrates that regional and global integration via improvement in transport and logistics will facilitate modern E-commerce, and boost productivity with real GDP growth. Given the dependence on agriculture and tourism, this kind of diversification is conducive for becoming non-susceptible to external vulnerability. Thus, structural reform facilitates growth across the oblasts (7 regions and 2 cities) in Kyrgyzstan and moves the economy by another 1.41 percentage points annually over the baseline path to 2030. |
| Keywords: | Computable General Equilibrium Models, Growth Diagnostics, Productivity effects, FDI, Trade, Structural Transformation, Economic Reforms, Regional Cooperation, Central Asia |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1250&r=int |
| By: | Marijn A. Bolhuis; Shushanik Hakobyan; Zo Andriantomanga |
| Abstract: | The Covid-19 pandemic has led to a large disruption of global supply chains. This paper studies the implications of supply chain disruptions for inflation and monetary policy in sub-Saharan Africa. Increases in supply chain pressures have had a sizeable impact on headline, food, and tradable inflation for a panel of 29 sub-Saharan African countries from 2000 to 2022. Our findings suggest that central banks can stabilize inflation and output more efficiently by monitoring global supply chains and adjusting the monetary policy stance before the disruptions have fully passed through into all inflation components. The gains from monitoring supply chain disruptions are particularly large for open economies which tend to experience outsized second-round effects on the prices of non-tradable goods and services. |
| Keywords: | Inflation; global supply chains; sub-Saharan Africa; shipping costs; monetary policy; core inflation; food prices; oil price |
| Date: | 2023–02–24 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2023/039&r=int |
| By: | Martina Magli |
| Abstract: | I provide new empirical evidence on the direct and indirect impact of services off-shoring on local employment and wages, using a unique dataset on firms in the UK for the period 2000-2015. Exploiting variation in firms' services offshoring across labour markets, I show positive aggregate local labour employment and wage elasticity to services offshoring. Spillovers from offshoring to non-offshoring firms explain the positive results, and services offshoring complementary to firms' production has a larger effect than the offshoring competing with firms' outputs. Finally, I show that services offshoring widens firms' employment and wage dispersion within local labour markets. This work contains statistical data from the Office for National Statistics supplied by the UK Dataservice. The use of these data does not imply the endorsement of the ONS or the UK Data Service at the UK Data Archive in relation to the interpretation or analysis of the data. This work uses research datasets which may not exactly reproduce National Statistics aggregates. The author thanks the UK Dataservice for their assistance and the Economic and Social Research Council (award number ES/J500100/1) for financial support. |
| Keywords: | services offshoring, local labour market, spillover effect, quantile analysis |
| Date: | 2022–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1892&r=int |
| By: | Carlo Lombardo; Julián Martinez-Correa; Leonardo Peñaloza-Pacheco; Leonardo Gasparini |
| Abstract: | We study the distributional effect of the massive exodus of Venezuelans in Colombia and how public policy can shape its impact. Using RIF-regressions in an instrumental variables approach, we find that the exodus had a larger negative effect on the lower tail of the natives’ wage distribution, increasing inequality in the host economy. We propose downgrading as the driving mechanism: due to formal restrictions, immigrants ended up working in more routine and lower-paying jobs than natives with similar characteristics. Finally, we show that a large-scale amnesty program reduced the magnitude of downgrading, mitigating the unequalizing impact of the exodus. |
| JEL: | D30 F22 J61 O15 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4573&r=int |
| By: | Md Deluair Hossen |
| Abstract: | The vast literature on exchange rate fluctuations estimates the exchange rate pass-through (ERPT). Most ERPT studies consider annually aggregated data for developed or large developing countries for estimating ERPT. These estimates vary widely depending on the type of country, data coverage, and frequency. However, the ERPT estimation using firm-level high-frequency export data of a small developing country is rare. In this paper, I estimate the pricing to market and the exchange rate pass-through at a monthly, quarterly, and annual level of data frequency to deal with aggregation bias. Furthermore, I investigate how delivery time-based factors such as frequent shipments and faster transport affect a firm`s pricing-to-market behavior. Using transaction-level export data of Bangladesh from 2005 to 2013 and the Poisson Pseudo Maximum Likelihood (PPML) estimation method, I find very small pricing to the markets to the exchange rates in the exporter's price. As pass-through shows how the exporters respond to macro shocks, for Bangladesh, this low export price response to the exchange rate changes indicates that currency devaluation might not have a significant effect on the exporter. The minimal price response and high pass-through contrast with the literature on incomplete pass-through at the annual level. By considering the characteristics of the firms, products, and destinations, I investigate the heterogeneity of the pass-through. The findings remain consistent with several robustness checks. |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2303.04101&r=int |
| By: | Aliu, Armando; Aliu, Dorian |
| Abstract: | The research aims to analyze the impact of the World Trade Organization on enhancing the legitimacy of global economic governance within the scope of the WTO law. The world economic outlook and macro-data indicators demonstrate that the convergence of interests amongst state actors and nonstate actors reinforces the efficiency of Bretton Woods institutions, such as the World Bank and the International Monetary Fund. The objective of this study is to highlight the fact that the WTO has vital efforts to strengthen the legitimacy of the global economic governance mechanism and liberalize economic activity in the world economic system. In a more liberalized transnational relations environment, the activities, operations, and efforts of nonstate actors provide a ground to stabilize economic cooperation and sustainable development. From a macro perspective, the study aims to monitor the first five-year period of the global financial crisis (2008-2013) and present the descriptive statistics and intercorrelations for 36 OECD countries. The research results indicate that 36 states’ governments should develop sustainable solutions to issues related to GDP, social security, and public / private expenditure in global economic governance platforms. In collaboration with governments, the WTO’s role is vital to cooperate with ILO and enhance its legitimacy and efficiency in labor relations, industrial relations, and employment protection. The research results illustrate that global economic governance has been reshaped by a ‘duality of global governance approach’ (i.e., a de facto G2: US-China relations), and the principles of global economic development have been reconstructed during the transition period from the Washington consensus to the Beijing consensus (G2 hegemony), competitively. |
| Date: | 2023–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:p259f&r=int |
| By: | Luc Arrondel (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - 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, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - 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); Richard Duhautois (LIRSA - Laboratoire interdisciplinaire de recherche en sciences de l'action - CNAM - Conservatoire National des Arts et Métiers [CNAM] - HESAM - HESAM Université - Communauté d'universités et d'établissements Hautes écoles Sorbonne Arts et métiers université, CEET - Centre d'études de l'emploi et du travail - CNAM - Conservatoire National des Arts et Métiers [CNAM] - HESAM - HESAM Université - Communauté d'universités et d'établissements Hautes écoles Sorbonne Arts et métiers université - M.E.N.E.S.R. - Ministère de l'Education nationale, de l’Enseignement supérieur et de la Recherche - Ministère du Travail, de l'Emploi et de la Santé) |
| Abstract: | The "jewel" in FIFA's crown and its main "asset" remains the World Cup. Established in 1928, it has been held every four years since the 1930 tournament hosted and won by Uruguay among 13 teams. Qatar will host 32 teams, but more than 200 teams from all six continental confederations have participated in the qualifying rounds. After the Second World War, the World Cup experienced a very strong growth in terms of broadcasting (from 1966), sporting notoriety, social stakes and economic activity (especially from the 1970s). The competition has become a global event, benefiting from a planetary diffusion. Not only has the World Cup become FIFA's main source of funding, but many national federations and governments are interested in hosting the event to benefit from the potential social and economic benefits. |
| Abstract: | Le « joyau » de la couronne de la FIFA et son principal « actif » demeure la Coupe du monde. Créée en 1928, elle a lieu tous les quatre ans depuis le tournoi de 1930 organisé et remporté par l'Uruguay parmi treize prétendants. Le Qatar accueillera 32 équipes, mais plus de 200 formations appartenant aux six confédérations continentales ont participé aux phases éliminatoires. Après la Seconde Guerre mondiale, la Coupe du monde va connaitre une très forte croissance en termes de diffusion (à partir de 1966), de notoriété sportive, d'enjeu social et d'activité économique (surtout à partir des années 1970). La compétition est devenue un évènement global, bénéficiant d'une diffusion planétaire. La Coupe du monde est non seulement devenue la principale source de financement de la FIFA, mais un grand nombre de fédérations nationales et de gouvernements souhaitent organiser cet événement pour bénéficier d'éventuelles retombées en matière sociales et économiques. |
| Keywords: | Economy, Geopolitics, Television, World Cup, Coupe du monde, Economie, FIFA, Géoéconomie, Télévision |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:hal:pseptp:halshs-03936123&r=int |
| By: | Sumon Kumar Bhaumik (University of Sheffield); Richard Frensch; Stephan Huber |
| Abstract: | The paper extends the literature on the political economy of labor market institutions by developing a framework in which owners of capital can benefit from both greater labor market flexibility and better rule of law. Their choice of location of manufacturing centres can, therefore, by influenced both by reduction in expropriation that is associated with better rule of law and greater bargaining power vis-à-vis workers by way of greater labor market flexibility. It follows that where owners of capital are better placed to influence government choices of these institutions, labor market flexibility is influenced by both labor market institutions intensity of exports and as well as rule of law intensity of exports. These predictions are borne out by a cross-country empirical analysis. |
| Keywords: | Labor market institutions; Political economy; Globalisation |
| JEL: | D72 J41 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:391&r=int |