nep-int New Economics Papers
on International Trade
Issue of 2023‒08‒21
forty-six papers chosen by
Luca Salvatici, Università degli studi Roma Tre

  1. Supply-chain disruptions and new investment policies in the post-COVID-19 world: Initial insights from project-level data By Monika Sztajerowska
  2. Rules of Origins Relaxation and Regional Supply Chains: Evidence from Europ By Pamela Bombarda; Elisa Gamberoni; Irene Iodice
  3. Capital Controls and Free-Trade Agreements By Simon P. Lloyd; Emile A. Marin
  4. The FDI liberalization and skill structure of labor market in China: The predicament of migrants By Li, Yifan; Miao, Zhuang; Wang, Junbo; Zhang, Yan
  5. Smile without a reason why: functional specialisation and income distribution along global value chains By Federico Riccio; Giovanni Dosi; Maria Enrica Virgillito
  6. Measuring Value Added in Gross Trade: Endogenous Approach of Vertical Differentiation By Dutta, Sourish
  7. Trading with Friends in Uncertain Times By Adam Jakubik; Michele Ruta
  8. Global Value Chain resilience and reshoring during Covid-19: challenges in a post-covid world By Enrico Marvasi
  9. Supply Shocks in Supply Chains: Evidence from the Early Lockdown in China By R. LAFROGNE-JOUSSIER; J. MARTIN; I. MEJEAN
  10. Effect of a European Carbon Border Adjustment Mechanism on the APAC Region: A structural gravity analysis By Aline MORTHA; ARIMURA Toshi H.; TAKEDA Shiro; Tatyana CHESNOKOVA
  11. Impacts of climate change on global agri-food trade By Bozzola, Martina; Lamonaca, Emilia; Santeramo, Fabio Gaetano
  12. Foreign Direct Investment Regulations under the US-China Conflict: : Developments in the US Congress (Japanese) By SUGINOHARA Masako
  13. Political Relations and Trade: New Evidence from Australia, China and the United States. By Yifei Cai; Jamel Saadaoui; Yanrui Wu
  14. Endogenous Horizontal and Vertical Differentiation: Measuring Value Added in Intra-industry Trade By Dutta, Sourish
  15. The Determinants of Foreign Direct Investment (FDI) A Panel Data Analysis for the Emerging Asian Economies By ATM Omor Faruq
  16. Importer Dynamics: Do Peers Matter? By Gregory Corcos; Stefanie Haller
  17. The Impact of Domestic Investment and Trade on Economic Growth in North Africa Countries: New Evidence from Panel CS-ARDL Model By Ben Yedder, Nadia; El Weriemmi, Malek; Bakari, Sayef
  18. MATS Report: "Weaponization of Grain Trade increased" By Häberli, Christian; Kostetsky, Bogdan
  19. 최근 Mega FTA SPS 규범의국제 논의 동향 및 시사점(Recent Regulatory Trends in Mega FTA SPS Chapters) By Kang, Minji
  20. Resource Dependence, Recycling, and Trade By Peter H. Egger; Christian Keuschnigg
  21. Optimal Ownership and Firm Performance: An Analysis of China’s FDI Liberalization By Peter Eppinger; Hong Ma
  22. Trading Up: International trade futures and the Western Australian economy By Alex Buckland; Alan S Duncan; Mohammad Farhad; Abebe Hailemariam; Daniel Kiely; Valentina Sanchez Arenas; Panagiotis Sotirakopoulos
  23. 무역 자유화와 소비자 후생효과:품질 다양성을 중심으로(The Impact of Trade Liberalization on Consumer Welfare: A Focus on Quality Diversity) By Chung, Chul; Kim, Bonggeun; Chung, Minchirl
  24. Exploring the recent resilience of Italy's goods exports: Competitiveness, energy intensity and supply bottlenecks By Simona Giglioli; Claire Giordano
  25. Exchange Rates, Tariffs and Prices in 1930s’ Britain By Jagjit S. Chadha; Jason Lennard; Solomos Solomou; Ryland Thomas
  26. E-Globalization and Trade Agreements By Phillip McCalman
  27. Brothers in Arms: The Value of Coalitions in Sanctions Regimes By Sonali Chowdhry; Julian Hinz; Katrin Kamin; Joschka Wanner
  28. Financial Crises and the Global Supply Network: Evidence from Multinational Enterprises By Sergi Basco; Giulia Felice; Bruno Merlevede; Martí Mestieri
  29. Trade, Income and Heterogeneous Labor Supply By Nicolás Depetris-Chauvin; Agustin Velasquez
  30. 미중 전략경쟁 시기의 대만 문제와 한국의 경제안보(The Taiwan Issue and Korea's Economic Security in the Era of U.S.-China Strategic Competition) By Heo, Jaichul
  31. Opposing firm-level responses to the China shock : Output competition versus input supply By P. AGHION; A. BERGEAUD; M. LEQUIEN; M. MELITZ; T. ZUBER
  32. China inside out: explaining silver flows in the triangular trade, c.1820s-1870s By Irigoin, Maria Alejandra; Kobayashi, Atsushi; Chilosi, David
  33. EU Strategic Dependencies: A Long View By Vincent Vicard; Pauline Wibaux
  34. Is acquisition-FDI during an economic crisis detrimental for domestic innovation? By García-Vega, María; Gupta, Apoorva; Kneller, Richard
  35. Cost Pass-Through and the Rise of Inflation By R. LAFROGNE-JOUSSIER; J. MARTIN; I. MEJEAN
  36. Cultural Distance, Firm Boundaries, and Global Sourcing By Yuriy Gorodnichenko; Bohdan Kukharskyy; Gerard Roland
  37. Explaining the Multifaceted Patterns of Migrant Entrepreneurship in the Global Economy: A Resource-Based Approach By Arrighetti, Alessandro; Canello, Jacopo
  38. Tax and Investment by Multinational Enterprises By Tibor Hanappi; David Whyman
  39. Globalization and Inequality in Latin America By Rafael Dix-Carneiro; Brian K. Kovak
  40. Local labor markets as a taxable location factor? Evidence from a shock to foreign labor supply By Nover, Justus
  41. Southern multilateralism from IBSA to NDB: synergies, continuities, and regional options By Alden, Christopher; le Pere, Garth
  42. Can the Middle East-North Africa region mitigate the rise of its food import dependency under climate change? By Chantal Le Mouël; Agneta Forslund; Pauline Marty; Stéphane Manceron; Elodie Marajo-Petitzon; Marc-Antoine Caillaud; Patrice Dumas; Bertrand Schmitt
  43. Regional Economic Impacts of the Øresund Cross-Border Fixed Link: Cui Bono? By Michael Funke; Kadri Männasoo; Helery Tasane
  44. Korea's problems with electric vehicle subsidies under the Inflation Reduction Act By Chad P. Bown
  45. The stabilising effects on GVCs of multi-annual supply contracts between leading and subordinate firms: The example of champagne By Hervé Lanotte; Aurélie Ringeval-Deluze; Erick Pruchnicki
  46. Backshoring, offshoring and staying at home: evidence from the UK textile and apparel industry By Casadei, Patrizia; Iammarino, Simona

  1. By: Monika Sztajerowska
    Abstract: The COVID 19 pandemic has inflicted a series of shocks on the global economy, not least impacting global trade and investment. During the same time, several countries adopted new foreign direct investment (FDI) related policies. This paper presents novel preliminary evidence on the effects of these new FDI policies and COVID-19-related supply-chain disruptions on cross-border investment. It employs, among others, granular data on FDI policies and investment projects undertaken in a wide range of sectors in 175 host economies worldwide by investors from 46 home countries. It finds that a combination of FDI policies and COVID-19-related measures has a statistically significant and economically meaningful negative effect on the probability of a new cross-border greenfield investment project occurring during the sample period. The effect is the strongest in sectors with high R&D intensity.
    Keywords: COVID-19, de-globalisation, FDI, Foreign direct investment, greenfield, supply chains
    JEL: F15 F21 F23 F52
    Date: 2023–07–31
  2. By: Pamela Bombarda; Elisa Gamberoni; Irene Iodice (Université de Cergy-Pontoise, THEMA)
    Abstract: Free trade agreements (FTAs) incorporate regulations regarding rules of origin (RoO) and cumulation. RoO regulations, by restricting the use of inputs outside the FTA, can affect the flow of intermediates in supply chains. We construct a new database to assess the effects of RoO, enabling us to explore two major events that led to RoO re- laxation in the European context: PECS, which provided the possibility of cumulating stages of production across the European Union’s FTA peripheral partners, and EU enlargement, which eliminated RoO altogether. Our results show that the progressive reduction in RoO had a sizeable impact on reshaping regional and international sup- ply chains. Across both episodes, we estimate consistent elasticities, indicating that a 1% increase in the value requirement restriction before relaxation corresponds to an intermediate import increase ranging from 0.3% to 0.7% from countries where RoO restrictions have been lifted.
    Keywords: ntermediate inputs trade, rules of origin, cumulation, PECS, EU enlargement, input-output tables.
    JEL: F12 F13 F14 F15
    Date: 2023
  3. By: Simon P. Lloyd (Bank of England; Centre for Macroeconomics (CFM)); Emile A. Marin (University of California, Davis)
    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 at the expense of the rest of the world by departing from free trade in addition to levying capital controls, absent retaliation from abroad. 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-temporallyare 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 retaliation, we show that committing to a free-trade agreement can reduce incentives to engage in costly capital-control wars for both countries.
    Keywords: Capital-Flow Management, Free-Trade Agreements, Ramsey Policy, Tariffs, Trade Policy
    JEL: F13 F32 F33 F38
    Date: 2023–02
  4. By: Li, Yifan; Miao, Zhuang; Wang, Junbo; Zhang, Yan
    Abstract: Throughout the era of China’s accession to World Trade Organization (WTO), the labor market and education dynamics have been significantly impacted by the surge in foreign direct investment (FDI). This study scrutinizes how these factors interplay, with emphasis on migrants’ educational attainment, skill premium, and employment status. Our empirical evidence suggests that while FDI bolsters the relative demand for high-skill labors, it concurrently enhances education premiums and the educational attainment in general. Nevertheless, an intriguing anomaly emerges with the downward trajectory of migrants' educational levels. This counterintuitive phenomenon is primarily driven by the double-edged predicament of employment discrimination against high-skill migrants and the sluggish growth in demand for their employment. Empirical analysis further reveals that the FDI liberalization period witnessed an insignificant rise in migrants’ educational premiums, thereby predisposing them to low-wage or high-hazard positions. Our quantitative simulation shows that migration workers will improve their educational levels by 16% by migrating to the higher FDI-exposed region, and improve 4% by removal of the employment discrimination toward the migrants. Our study contributes to the understanding labor market structural shifts and migrant employment conditions in China during its WTO accession period. Additionally, it provides insights for policy-making geared towards the equitable distribution of FDI benefits.
    Keywords: FDI Liberalization; Educational Attainments; Educational Wage Premium; Migration
    JEL: F20 I20 J15
    Date: 2023–06–01
  5. By: Federico Riccio; Giovanni Dosi; Maria Enrica Virgillito
    Abstract: This paper addresses two questions namely, first, the extent to which the very participation in Global Value Chains (GVCs) has penalised labour as a globally insourced production input, and, second, what happened to between-occupation functional inequality. We combine input-output (I-O) tables and labour income along the production stages of global value chains. We focus on foreign labour requirements in manufacturing industries and distinguish across four production stages, namely fabrication, marketing, R&D and managerial functions to map the relative specialisation patterns of different production sub-systems. Our results show that GVCs are hierarchically structured, with advanced countries specialising in upstream functions along global production networks. Fabrication workers are the biggest losers in this process, accounting for most of the drop in labour share in developed and developing countries. Considering that production workers make up more than 50% of the workforce in both advanced and developing countries, the labour share loss of blue-collar workers is a major driver of the increasing global wage inequality.
    Keywords: Labour Share; Global Value Chains; Functional Specialisation; Comparative Advantages; Income Inequalities; International division of Labour.
    Date: 2023–08–05
  6. By: Dutta, Sourish
    Abstract: From the beginning of the 1980s, the first theoretical analysis of intra-industry trade showed that the determinants and consequences of this type of trade are different, depending on whether the traded products differ in quality. When the products are subject to intra-industry trade between two countries with distinct qualities, this trade is vertically differentiated. Otherwise, it is called horizontal differentiation. There is a method for distinguishing intra-industry trade between two countries in vertical differentiation from those in horizontal differentiation. This method compares exports' unit value to imports for each industry's intra-industry trade. It considers the intra-industry trading carried out in this industry as vertical differentiation when the unit value of exports differs significantly from that of imports. This approach has limitations. The discussion below will lead us to think about an alternative method for separating and measuring intra-industry trade into horizontal and vertical differentiation.
    Keywords: Intra-industry Trade, Vertical Intra-industry Trade, Horizontal Intra-industry Trade, Value Added
    JEL: F0 F1
    Date: 2023
  7. By: Adam Jakubik; Michele Ruta
    Abstract: In this paper we seek to answer the question of how the patterns of bilateral trade are altered by rising trade policy uncertainty (TPU). Specifically, we investigate whether geopolitical alignments between country pairs determine how bilateral trade flows react during periods of greater uncertainty. Using a structural gravity framework augmented with a text-based TPU index and a geopolitical distance measure based on UN General Assembly voting records, we find a significant negative effect of the latter when TPU is elevated, indicating a shift to trading among “friends” in uncertain times.
    Keywords: trade policy uncertainty; geopolitical distance; trade patterns; textual analysis; World uncertainty index; trade pattern; benchmark result; text-based TPU index; importer-exporter FE; Trade policy; Trade balance; Plurilateral trade; Trade tensions; Trade barriers; Global
    Date: 2023–06–16
  8. By: Enrico Marvasi
    Abstract: This paper provides an overview on the evolution of Global Value Chains (GVCs) and on how they were impacted by Covid-19. Evidence from recent studies on Italy shows that GVCs displayed a high degree of resilience, with GVC firms better equipped to face the covid-shock and suffering less in terms of closures and turnover. Moreover, reshoring and substitution of foreign suppliers with domestic ones were chosen only by a small minority of firms. GVCs will probably continue to characterize the world economy, but the uncertainty about the future developments remains high. The last part of the paper discusses the challenges and the possible GVC reconfigurations in a post-covid world.
    Keywords: Global Value Chains, resilience, reshoring, Covid-19, Italy.
    JEL: F14 F23 F60
    Date: 2022–10
  9. By: R. LAFROGNE-JOUSSIER (Insee and CREST-Ecole Polytechnique); J. MARTIN (Université du Quéebec à Montréal and CEPR); I. MEJEAN (Sciences Po and CEPR)
    Abstract: How do firms in global value chains react to input shortages? We examine micro-level adjustments to supply chain shocks, building on the COVID-19 pandemic as a case study. French firms sourcing inputs from China just before the early lockdown in the country experienced a relative drop in imports that increases from February to April 2020. This shock on input purchases transmits to the rest of the supply chain through exposed firms' domestic and export sales. Between February and June, firms exposed to the Chinese early lockdown experienced a 5.5% drop in domestic sales and a 5% drop in exports, in relative terms with respect to comparable non-exposed firms. The drop in foreign sales is entirely attributable to a lower volume of exports driven by a temporary withdrawal from occasional markets. We then dig into the heterogeneity of the transmission across treated firms. Whereas the ex-ante geographic diversication of inputs does not seem to mitigate the impact of the shock, firms with relatively high inventories have been able to absorb the supply shock better.
    Keywords: Covid-19 pandemic, Supply chain disruptions, Transmission of shocks, Global Value Chains
    JEL: F1 F6
    Date: 2023
  10. By: Aline MORTHA; ARIMURA Toshi H.; TAKEDA Shiro; Tatyana CHESNOKOVA
    Abstract: To address concerns over carbon leakage, the European Union (EU) has announced the introduction of a Carbon Border Adjustment Mechanism (CBAM). This study applies a structural gravity model to simulate the impact of CBAM on welfare, production, exports and emissions with a focus on four sectors: chemicals, iron and steel, non-ferrous metal and metal products. We also provide country-specific results for the Asian and the Pacific regions. Our results show that, while CBAM would have little effect on welfare, the policy would contribute to a reduction in exports, estimated between -0.29% (metal products) and -1.49% (iron and steel). In particular, we find that middle income economies are most affected by the policy, and that these countries tend to greatly reduce their exports to the EU. We also observe a rebound in production (and associated emissions) among the EU economies. Nevertheless, by including emissions from shipping activities, CBAM can result in a large decrease in emissions, most of which is due to export reduction.
    Date: 2023–08
  11. By: Bozzola, Martina; Lamonaca, Emilia; Santeramo, Fabio Gaetano
    Abstract: Climate change and trade are closely related. Climate may alter the comparative advantages across countries, which may in turn trigger changes in trade patterns. Trade itself may constitute an adaptation strategy, moving excesses of agri-food supply to regions with shortages, and this in turn may explain changes in land-use. We investigate these linkages, showing that the changes in climate affect counties’ trade value and contribute to reshaping trade patterns. First, we quantify the long-term impacts of climate on the value of agri-food exports, implicitly considering the ability of countries to adapt, and show that higher marginal temperatures and rainfall levels tend to be beneficial for countries’ exports. Following a gravity model approach, we then link the evolving trade patterns to climate change adaptation strategies. We find that the larger the difference in temperatures and rainfall levels between trading partners, the higher the value of bilateral exports. Furthermore, while developed and developing exporters are both sensitive to climate change and to cross-countries heterogeneity in climate, we found their responses to changes in climate to be quite diverse.
    Keywords: Climate normal; Climate heterogeneity; Export; Economic development.
    JEL: F18 O13 O44 Q17 Q54
    Date: 2023
  12. By: SUGINOHARA Masako
    Abstract: As the US-China confrontation continues to escalate, a critical political issue revolves around whether the two deeply interdependent economies should proceed with the decoupling of their economic systems. This paper aims to explore the perspectives of US Congress members concerning economic relations with China, focusing on the case study of foreign direct investment (FDI) restrictions. It seeks to uncover the underlying political and economic factors that influence these attitudes. Within the US Congress, there has been a growing chorus of voices advocating for a tough stance against China, spanning across both Republican and Democratic parties. Consequently, there has been a tightening of restrictions on inward FDI from China, alongside new efforts to limit outward FDI to China. However, it is crucial to recognize that such measures could potentially have adverse effects on the US economy, and as a result, significant opposition from various industries has emerged. This paper aims to analyze the motivations that driving legislators to pursue these policies.
    Date: 2023–07
  13. By: Yifei Cai; Jamel Saadaoui; Yanrui Wu
    Abstract: This paper employs structural vector autoregression and local projection methods to examine the impacts of the deterioration in US-China political relations on bilateral trade between Australia and China. Three scenarios are considered to reflect the evolution of US geopolitical strategies in recent years such as “America First”, “China Threat Theory” and “The Protection of US Allies”. The simulation results illustrate that worsening US-China political relations has a negative impact on Australian exports to and imports from China. It is also found that economic conditions in the US play a more important role in the transmission of this impact than those in China and Australia. In addition, various options are explored to check the robustness of the findings in this paper.
    Keywords: Structural vector autoregression, Local projection, Impulse response; USChina political relations; Australia-China trade.
    JEL: C32 F14 F51
    Date: 2023
  14. By: Dutta, Sourish
    Abstract: The development of research studies concerning the emergence of intra-industry trade is fruitful interaction between theoretical explanations and empirical methods to measure this phenomenon. The foundation of indicators to measure the intensity of intra-industry trading caused the rise of theoretical models explaining the determinants of these trade flows. It also contributed to the debate on the need to distinguish, in empirical analyses, intra-industry trade in horizontal differentiation from that in vertical differentiation. From the beginning of the 1980s, the first theoretical analysis of intra-industry trade showed that the determinants and consequences of this type of trade are different, depending on whether the traded products differ in quality. When the products are subject to intra-industry trade between two countries with distinct qualities, this trade is vertically differentiated. Otherwise, it is called horizontal differentiation. There is a method for distinguishing intra-industry trade between two countries in vertical differentiation from those in horizontal differentiation. This method compares exports' unit value to imports for each industry's intra-industry trade. It considers the intra-industry trading carried out in this industry as vertical differentiation when the unit value of exports differs significantly from that of imports. This approach has limitations. This discussion will lead us to think about an alternative method for separating and measuring intra-industry trade into horizontal and vertical differentiation.
    Date: 2023–07–21
  15. By: ATM Omor Faruq
    Abstract: In this paper, we explore the economic, institutional, and political/governmental factors in attracting Foreign Direct Investment (FDI) inflows in the emerging twenty-four Asian economies. To examine the significant determinants of FDI, the study uses panel data for a period of seventeen years (2002-2018). The panel methodology enables us to deal with endogeneity and other issues. Multiple regression models are done for empirical evidence. The study focuses on a holistic approach and considers different variables under three broad areas: economic, institutional, and political aspects. The variables include Market Size, Trade Openness, Inflation, Natural Resource, Lending Rate, Capital Formation as economic factors and Business Regulatory Environment and Business Disclosure Index as institutional factors and Political Stability, Government Effectiveness, and Rule of Law as political factors. The empirical findings show most of the economic factors significantly affect FDI inflows whereas Business Disclosure is the only important institutional variable. Moreover, political stability has a significant positive impact in attracting foreign capital flow though the impact of government effectiveness is found insignificant. Overall, the economic factors prevail strongly compared to institutional and political factors.
    Date: 2023–07
  16. By: Gregory Corcos; Stefanie Haller
    Abstract: Few firms import, even when formal trade barriers are low and despite substantial potential gains. Likely reasons are uncertainty and informational frictions, creating scope for local peers to affect new importers. We explore this hypothesis using data on French imports by firm-product-country-year, location, and importer characteristics. First, we study the decision to start importing as a function of the lagged number of importers in the same commuting zone (CZ). We find that the presence of such peers more than doubles the probability to start importing the same product from the same country. The effect increases disproportionately with the number of peers. Second, we examine how the elimination of Multi-Fibre Agreement textile and clothing quotas affects the number of import starters at the CZ level. Here the number of import starters from quota countries increases by 40 to 90% more in commuting zones with a higher initial number of peers.
    Keywords: trade, import start, spillovers, peer effects, Multi-Fibre Agreement
    JEL: F14 F61 D22
    Date: 2023
  17. By: Ben Yedder, Nadia; El Weriemmi, Malek; Bakari, Sayef
    Abstract: The aim of this work is to examine the impact of domestic investment and trade on economic growth in the case of North Africa countries during the period 1990 – 2021 by using Panel CS-ARDL Model. Empirical results indicate that domestic investment and exports don’t have any impact on economic growth in the long run. However, we found that the impact of imports is positive in the long run. These results show that exports and national investments are not considered as a source of economic growth in the country of North Africa over this extended period and suffer from a miserable economic organization and many problems in terms of political and economic instabilities.
    Keywords: Domestic Investment, Exports, Imports, Economic Growth, North Africa Countries, CS-ARDL Model.
    JEL: E22 F11 F14 O10 O16 O40 O47 O55
    Date: 2023–07
  18. By: Häberli, Christian; Kostetsky, Bogdan
    Abstract: The latest report on "Repairing Broken Food Trade Routes Ukraine – Africa” covers: Kakhovska HPP and the war Western border and EU grains production Grain Initiative This project has received funding from the European Union's Horizon 2020 research and innovation programme “Making Agricultural Trade Sustainable” (MATS) programme ( The role of MATS/WTI in this programme is to identify and explore “broken” Ukrainian - African food trade routes due to the Russian invasion of Ukraine. Starting with a food trade flow chart pre- and post-24 February 2022, it will assess, first, whether Ukrainian (or African) traders can again supply these products (Output 1). Failing that, whether the new EU-financed “Crisis Management” (or another) programme can possibly make up for lost Ukrainian agrifood exports (Output 2). It will also identify alternative exporters (if any) which might already have filled in agrifood demand in Africa (Output 3). Importantly, the Project also looks at the potential effect of these developments on competing farm production in Africa (Output 4). For further information and/or offer to assist in project implementation, please write to Christian Häberli ( or to Bogdan Kostetsky (
    Date: 2023–08–04
    Abstract: 본 연구에서는 우리나라가 기체결한 FTA의 SPS 규정을 살펴보고, Mega FTA 검역환경과 관련하여 CPTPP, RCEP, USMCA SPS 챕터 규범을 비교·분석하였으며, 이와 관련한 국내 법제 현황을 축산물 검역, 식물 검역, 수산물 검역, 식품 검역으로 나누어 검토하였다. 또한 Mega FTA 검역환경으로의 대응 방향, SPS 챕터에 대한 FTA 분쟁해결절차 적용, IPEF 농업 협상 및 기체결 FTA 개선협상에 대한 정책 시사점을 제시한다. Previous studies on mega Free Trade Agreement (FTA) Sanitary and Phytosanitary (SPS) provisions have primarily focused on the translation and preparation required for implementing the SPS regulations outlined in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). However, in order to gain a comprehensive understanding of the current state of SPS regulations in recent FTAs, this study goes beyond the CPTPP and also includes the Regional Comprehensive Economic Partnership (RCEP), which is currently the largest FTA in existence and came into effect in Korea in February 2022. Additionally, the study compares these regulations with those of the United States-Mexico-Canada Agreement (USMCA). In addition to examining the SPS provisions of these mega FTAs, this study also investigates the status of domestic legislation related to SPS regulations in four specific areas: livestock quarantine, plant quarantine, fishery quarantine, and food quarantine. By conducting this analysis, the study aims to provide a comprehensive overview of the SPS chapter regulations in these mega FTAs as well as the domestic measures implemented in relation to SPS in the aforementioned sectors. Prior to the introduction of the Mega FTA, all of Korea’s bilateral FTAs included SPS provisions or chapters, but few included WTO Plus provisions. Furthermore, most bilateral FTAs specified that the dispute settlement procedures of the FTA would not be applicable to SPS provisions or chapters. The primary WTO SPS Plus provision found in these FTAs was the inclusion of an FTA SPS Committee, which served as a platform for bilateral discussions on SPS issues and facilitated information exchange. Additionally, depending on the FTA partner, FTA SPS chapters included WTO Plus provisions such as regionalization procedures, risk analysis in their own country, and cooperation on animal welfare. However, there has been a notable shift in this trend with the introduction of Mega FTAs. The SPS chapters of the CPTPP, the RCEP, and the USMCA have witnessed a significant increase in the number of provisions. On average, these mega FTAs contain 18.3 provisions in their SPS chapters, which is considerably higher than the average of 5.7 provisions found in Korea’s previously concluded FTAs. (the rest omitted)
    Keywords: SPS; Mega FTA; Quarantine; Sanitary Quarantine; Regionalization; Equality; Free Trade Agreement; CPTPP; Regionalization; Equivalence; FTA
    Date: 2023–05–19
  20. By: Peter H. Egger; Christian Keuschnigg
    Abstract: Recycling waste from used goods can substitute for scarce raw materials and reduce resource dependence. This paper presents a model of waste collection, recycling and final goods production using raw and recycled materials. Non-recycled waste must be safely stored by landfill to avoid environmental damage. The costs of waste disposal create externalities. An optimal allocation requires a trash tax to make producers pay for the costs of waste disposal, and an input subsidy to recycling firms to compensate for the savings in disposal costs. We study trade between resource poor economies exporting final goods, and resource rich countries exporting raw materials. We find rich welfare effects of trade policy with non-trivial interactions between terms of trade effects and distortions in recycling and resource extraction.
    Keywords: waste, recycling, externalities, resource dependence, trade
    JEL: D62 Q32 Q53 F18
    Date: 2023
  21. By: Peter Eppinger; Hong Ma
    Abstract: Seminal theories of the firm posit that firm ownership is allocated to minimize contractual inefficiencies. Yet, it remains unclear how much the optimal ownership choice affects firm performance in practice. This paper provides a first quantification of the gains from optimal ownership within multinational firms, by exploiting a major liberalization of China’s policy restrictions on foreign ownership. The liberalization allowed previously restricted firms to become fully foreign owned. We find that these reoptimized ownership choices raise firm output by 40% and productivity by 7.5% on average. An extended property-rights theory of the multinational firm rationalizes these effects and their heterogeneity.
    Keywords: multinational firms, ownership, integration, firm performance, property-rights theory, China
    JEL: D23 F21 F23 L22 L23
    Date: 2023
  22. By: Alex Buckland (Bankwest Curtin Economics Centre (BCEC), Curtin University); Alan S Duncan (Bankwest Curtin Economics Centre (BCEC), Curtin University); Mohammad Farhad (Bankwest Curtin Economics Centre (BCEC), Curtin University); Abebe Hailemariam (Bankwest Curtin Economics Centre (BCEC), Curtin University); Daniel Kiely (Bankwest Curtin Economics Centre, Curtin Business School); Valentina Sanchez Arenas (Bankwest Curtin Economics Centre, Curtin University); Panagiotis Sotirakopoulos (Bankwest Curtin Economics Centre, Curtin University)
    Abstract: The eighth report in the BCEC Focus on Industry report series, Trading Up: International trade futures and the Western Australian economy, examines the benefits, opportunities and challenges that exist for the WA economy in relation to trade and investment. The report explores the scale and scope of these challenges and highlight the opportunities for WA’s future economic prosperity.
    Keywords: diversification, international trade, trade flows, free trade agreements, regional economic development, decarbonisation, benefits from trade, green economy.
    JEL: F1 F13 Q17 Q56
    Date: 2023–07
    Abstract: 우리나라가 체결한 많은 자유무역협정(FTA)이 과연 우리 삶의 질을 어떻게 변화시켰는지에 대해 체계적으로 분석한 연구가 흔치 않다. 본 연구는 무역자유화에 따른 수입품목의 다양성 확대와 가격하락에 따른 소비자들의 품질 선택의 폭이 넓어지는 점에 착안하여, 품질 다양성과 소비자의 질적 대응을 중심으로 실증분석을 수행하고 정책시사점을 제시한다. This study investigates the impact of domestic price changes due to external shocks such as trade liberalization or global inflation on quality diversity and consumer welfare. Free trade agreements (FTAs) can reduce the prices of imported goods through tariff elimination or reduction, making it crucial to evaluate academically and in terms of policy how this price reduction affects consumer welfare. In contrast to prior literature on trade liberalization, this study emphasizes the role of quality diversity in explaining its impact on consumer welfare. We focus on how consumers’ qualitative responses to price changes, such as selecting high-quality products when prices decrease due to tariff reductions or responding to price increases due to tobacco taxes by adjusting the quality of their purchases, can influence consumer welfare. This study also provides policy implications regarding the impact of trade liberalization on consumer welfare. Using time-series data on wine and cigarettes in South Korea, this research estimated price elasticities and separated them into consumers’ quantitative and qualitative responses to price changes. The results indicate that the qualitative margin accounts for as much as 40% of the total, demonstrating that consumers’ qualitative responses to price changes are quite significant. We also found a statistically significant consumer behavior mechanism of quality shading in response to price increases for both wine and cigarette consumption, suggesting that consumers’ qualitative responses are as important as their quantitative responses. Moreover, we found that price reductions not only increase the consumption quantity of the same product but also lead to a shift to higher quality products, further enhancing consumers’ welfare. For the first time in the literature, we analyzed qualitative margins by income level and found that the price elasticity is higher for lower-income consumers, and most of it can be attributed to qualitative responses. These empirical findings suggest that consumers can adjust their spending on a particular good through qualitative adjustments while maintaining their overall consumption, particularly in response to rapid inflation. This response mechanism is particularly more effective for low-income households.(the rest omitted)
    Keywords: Free trade; trade policy; trade liberalization; consumer welfare; consumer response; product diversity; quality selection
    Date: 2023–05–25
  24. By: Simona Giglioli (Bank of Italy); Claire Giordano (Bank of Italy)
    Abstract: We explore three possible explanations of the recent resilience of Italy's foreign sales in comparison with the other three main euro-area economies, namely price-competitiveness dynamics, developments in energy-intensive (EI) and non-energy-intensive (NEI) manufacturing sectors, the impact of global supply bottlenecks. Price-competitiveness trends were particularly favourable in Italy in 2022. Furthermore, the composition of Italy’s manufacturing exports was not strongly tilted towards EI sectors and the decline in EI foreign sales was relatively small, leading to a more limited negative contribution of these industries to aggregate export growth compared with Germany. Finally, according to cross-country firm survey data, manufacturing in Italy was significantly less affected by shortages of materials and equipment than in the other three countries. A standard regression analysis of goods exports trends confirms that the above factors contributed to explaining Italy's strong performance in 2022.
    Keywords: goods exports, price competitiveness, energy intensity, supply bottlenecks
    JEL: F01 F10 Q41
    Date: 2023–07
  25. By: Jagjit S. Chadha (National Institute of Economic and Social Research (NIESR)); Jason Lennard (London School of Economics (LSE); Centre for Macroeconomics (CFM)); Solomos Solomou (University of Cambridge); Ryland Thomas (Bank of England)
    Abstract: This paper investigates the degree of pass-through from import prices and tariffs to wholesale prices in interwar Britain using a new high-frequency micro data set. The main results are: (i) Pass-through from import prices and tariffs to wholesale prices was economically and statistically significant. (ii) Despite devaluation, import prices exacerbated deflation in the early 1930s because of the global slump in export prices. (iii) Rising protection, however, was a mild stimulus to prices during the shift to inflation.
    Keywords: Exchange rates, interwar, pass-through, prices, tariffs, United Kingdom
    JEL: E31 F13 N14
    Date: 2023–02
  26. By: Phillip McCalman
    Abstract: The global success of online search engines and social media is due to their free access and high level of quality. However, these features are supported by a business model that exploits personal user data to provide targeted advertising services to third parties. Does this business model deliver socially desirable outcomes at the global and/or national level? To explore these questions, we characterize how a global monopoly platform chooses the level of privacy protection and service quality. When a platform operates a free service model it over-exploits personal information and underprovides quality compared to a global planner. Despite distortions along two dimensions, global welfare can be improved by a policy of enhanced privacy protection alone. In fact, it is likely that enhanced privacy protection will also induce higher platform quality. Furthermore, when privacy policies are set at the national level, large countries tend to align with the global interest, thanks to a “Brussels effect” where a global monopoly platform will improve privacy protection across all its markets in response to a policy change in one country. The alignment of unilateral and multilateral incentives reduces the need for a trade agreement to cover privacy protection. However, countries do have a beggar-thy-neighbor motivation to apply ad tech taxes, making these policies an area where international cooperation is needed.
    Keywords: trade policy, trade agreements, WTO, platforms, two-sided markets
    JEL: F10
    Date: 2023
  27. By: Sonali Chowdhry; Julian Hinz; Katrin Kamin; Joschka Wanner
    Abstract: This paper examines the impact of coalitions on the economic costs of the 2012 Iran and 2014 Russia sanctions. By estimating and simulating a quantitative general equilibrium trade model under different coalition setups, we (i) dissect welfare losses for sanctions senders and target; (ii) compare prospective coalition partners; (iii) investigate “optimal” coalitions that maximise payoff from sanctions; (iv) provide bounds for sanctions potential, i.e. the maximum welfare change attainable when sanctions are scaled vertically up to an embargo, and horizontally up to a global regime. Relative to unilateral action, we find that coalitions magnify welfare losses imposed while their impact on domestic welfare loss incurred depends on the design and sectoral dimension of sanctions. Hypothetical cooperation of large developing economies such as China additionally raises the deterrent force of coalitions. Additionally, we quantify transfers that equalise welfare losses across coalition members to further demonstrate asymmetries in the relative economic burden of sanctions. In all scenarios, we implement a novel Bayesian bootstrap procedure that generates confidence bands for simulation outcomes.
    Keywords: sanctions, embargoes, alliances, sectoral linkages
    JEL: F13 F14 F17 F51
    Date: 2023
  28. By: Sergi Basco; Giulia Felice; Bruno Merlevede; Martí Mestieri
    Abstract: This paper empirically examines the effects of financial crises on the organization of production of multinational enterprises. We construct a panel of European multinational networks from 2003 through 2015. We use as a financial shock the increase in risk premia between August 2007 and July 2012 and build a multinational-specific shock based on the network structure before the shock. Multinationals facing a larger financial shock perform worse in terms of revenue, employment, and growth in the number of affiliates. Lower growth in the number of affiliates operates through a negative effect on domestic and foreign affiliates, and is concentrated in affiliates in a vertical relationship with the parent. These effects built up slowly over time. Negative effects are driven by multinationals with initially more leveraged parents, who adjust to the financial shock by reducing relatively more the number of foreign affiliates. These findings lend support to the hypothesis of financial frictions shaping multinational activity.
    Keywords: global financial crisis; Vertical integration
    JEL: F14 F23 F44 L22 L23
    Date: 2023–04
  29. By: Nicolás Depetris-Chauvin (HES-SO); Agustin Velasquez (IMF)
    Abstract: Workers in developing countries tend to spend more time at work than those in developed countries. This can be explained by preferences with prevalent income effects: as income rises, workers reduce their supply of labor hours to consume more leisure. However, not all workers benefit alike. In this study, we estimate the heterogeneous effects of trade, as a shifter of aggregate income, on workers’ labor supply by age, education, and gender. We find that all workers benefit from more leisure caused by the income boost triggered by trade. However, young and elder workers benefit significantly more than prime-age workers. In addition, following increased trade openness women and less educated workers tend to reduce their labor supply relatively more
    Keywords: Hours worked, leisure, labor supply, international trade
    JEL: F16 J22
    Date: 2023–08
    Abstract: 미중 전략경쟁 심화와 4차 산업혁명에 따른 반도체 수요의 증가, 그리고 러시아-우크라이나 전쟁 등을 배경으로대만 문제가 부각되고 있다. 본 연구는 공급망 안정과 산업경쟁력, 경제적 통치술을 중심으로 한 경제안보의관점에서 대만해협 유사시 우리의 경제안보가 받게 될 영향과 시사점에 대해 고찰하였다. During the Cold War, the United States and China began visible efforts to normalize relations in 1972, with the strategic intent of jointly responding to the common threat posed by the Soviet Union, and finally established diplomatic relations in 1979. In this process, the Taiwan issue was one of the biggest obstacles to normalizing bilateral relations. Nevertheless, the two countries succeeded in establishing diplomatic relations by agreeing on the “One China” principle (policy) andrecognition of non-governmental exchanges between the U.S. and Taiwan, and have managed the Taiwan issue based on three joint statements made by the two countries. However, the Taiwan issue has been brought to the forefront again, mainly due to great transformation in the international order and strategic competition between the U.S. and China, created by the rise of China and the response of the U.S. to contain it. Of course, even after the establishment of diplomatic relations between the U.S. and China, friction between the U.S. and China over the Taiwan issue and confrontation between both sides of the Taiwan Straits (i.e. Chinese mainland and Taiwan) have continued. However, the recent U.S.-China strategic competition has further increased the risk and uncertainty of the Taiwan issue. In addition, with the outbreak of the Russia-Ukraine War, the international community's concern about the Taiwan Strait has grown, and the strategic value of Taiwan is rising even more in the era of the Fourth Industrial Revolution, as an important actor in the global semiconductor supply chain. Against this background, this study analyzes the impact of U.S.-China strategic competition on the Taiwan issue and considers the implications for Korea in terms of supply chain stability, industrial competitiveness, and economic statecraft, which are important elements of economic security.First, the supply chain instability that can result from an emergency in the Taiwan Strait will mainly occur along the maritime transportation route, which accounts for an overwhelming portion of Korea's import and export volume.(the rest omitted)
    Keywords: 경제안보; 중국정치; Economic security; Chinese politics
    Date: 2023–03–09
  31. By: P. AGHION (Collège de France, LSE and INSEAD); A. BERGEAUD (Banque de France and CEP); M. LEQUIEN (Insee); M. MELITZ (Harvard and NBER); T. ZUBER (Banque de France)
    Abstract: We decompose the “China shock” into two components that induce different adjustments for firms exposed to Chinese exports: an output shock affecting firms selling goods that compete with similar imported Chinese goods, and an input supply shock affecting firms using inputs similar to the imported Chinese goods. Combining French accounting, customs, and patent information at the firm-level, we show that the output shock is detrimental to firms’ sales, employment, and innovation. Moreover, this negative impact is concentrated on low-productivity firms. By contrast, we find a positive effect - although often not significant - of the input supply shock on firms’ sales, employment and innovation.
    Keywords: Competition shock, patent, firms, import
    JEL: F14 O19 O31 O33 O34
    Date: 2023
  32. By: Irigoin, Maria Alejandra; Kobayashi, Atsushi; Chilosi, David
    Abstract: This paper analyses a new, large dataset of silver prices, as well as silver and merchandise trade flows in and out of China in the crucial decades of the mid-19th century when the Empire was opened to world trade. Silver flows were associated with the interaction between heterogenous monetary preferences and availability of specific coins. Before the 1850s, money markets became increasingly efficient, as reliance on bills of exchange allowed exports to grow in times when sound money was in short supply. When a new standard for silver eventually emerged, there was a new peak in China’s silver imports.
    Keywords: China silver flows; triangular trade settlement mechanism; exchange operations; arbitrage; ‘opening of China’
    JEL: E42 F33 N10
    Date: 2023–07–01
  33. By: Vincent Vicard; Pauline Wibaux
    Abstract: We analyze how trade dependencies have evolved over time to better understand how they relate to vulnerabilities. We focus on the EU-27 and apply the bottom-up approach laid out by the European Commission (EC) using trade data from 1996 to 2019. The number of dependent products has shown no clear pattern since the mid-1990s, nor has their sectoral composition. The geography of dependencies has, however, evolved towards dependencies concentrated on Chinese suppliers, but this shift had already occurred in 2010. The products identified as dependent exhibit significant churning over time: one out of five dependent products in 2018 was not identified as such one year later in 2019 and close to half of dependent products in 2014 were not identified as such five years later.Creation-Date: 2023-06
    Keywords: Strategic autonomy;Dependent products;Trade dependencies;Economic security
    JEL: F5 F14
  34. By: García-Vega, María; Gupta, Apoorva; Kneller, Richard
    Abstract: We study how acquisition-FDI during economic crises affects R&D investments of target firms as compared to acquisitions made during periods of economic growth. Using a panel of Spanish firms, we find that foreign multinationals cherry-pick the best domestic firms, irrespective of timing of acquisition. Using matching and difference-in-difference regressions, we find that firms acquired during crises experience smaller declines in R&D than those acquired during periods of growth. Our results are consistent with the opportunity cost theory of R&D over the business cycle, as we also find that crisis-acquired firms prioritize new product creation over achieving economies of scale.
    Keywords: Foreign Acquisition, Recession, Innovation, Business cycle
    JEL: G34 O31 G01 D22
    Date: 2023
  35. By: R. LAFROGNE-JOUSSIER (Insee and CREST-Ecole Polytechnique); J. MARTIN (Université du Quéebec à Montréal and CEPR); I. MEJEAN (Sciences Po and CEPR)
    Abstract: We use micro-level price data underlying the French producer price index from January 2018 to July 2022, along with external measures of firms' exposure to imported inputs and energy cost shocks, to study the role of external shocks in the recent inflation surge. Within our sample, firms pass through 30% of changes in the price of imported inputs and 100% of changes in energy costs when resetting their prices, conditional on their exposure to these shocks. For the average firm in our data, this implies that a 10% increase in foreign costs leads to a 0.74% rise in output prices, while a 10% energy cost shock induces prices to increase by 0.73%. We examine how pass-through rates vary across firms within and across industries, depending on their size and exposure to shocks. We find that pass-through rates are asymmetric, with positive cost shocks inducing significantly more pass-through than negative shocks. The heterogeneity in exposure to external shocks across firms and sectors drives important differences in inflation dynamics along firms' distribution. To illustrate this, we predict price changes from cumulative imported inputs and energy price changes between January 2021 and July 2022, and find that between 70% and 75% of the variance in predicted price changes happens within 2-digit industries, across firms. The chemical and metal industries are the most impacted by both imported and energy cost shocks, which contribute to an increase in producer prices in those sectors of at least 9% to 14%.
    Keywords: Inflation, Energy prices, Imported Inflation, Cost Pass-Through
    JEL: F1 F4 L1
    Date: 2023
  36. By: Yuriy Gorodnichenko; Bohdan Kukharskyy; Gerard Roland
    Abstract: Casual observation suggests that cultural differences play an important role in business transactions, yet systematic evidence on this relationship is scarce. This paper provides a novel investigation of the effect of cultural distance on multinational firms’ decisions to integrate their cooperation partners into firm boundaries, rather than transact with independent companies at arm’s-length. To guide our empirical analysis, we develop a simple theoretical model which suggests that (i) cultural distance between contracting parties decreases the relative attractiveness of integration, and (ii) this effect is mitigated in more productive firms. We test these predictions using extensive product-, industry-, and firm-level data. We find a robust negative relationship between cultural distance and the relative attractiveness of integration. In line with our theoretical predictions, we also find that the effect of cultural distance on firm boundaries is less pronounced the higher firm’s productivity.
    Keywords: cultural distance, firm boundaries, international make-or-buy decision, firm productivity
    JEL: F14 F23 L14 L23
    Date: 2023
  37. By: Arrighetti, Alessandro; Canello, Jacopo
    Abstract: This article aims to propose a novel theoretical framework to interpret the recent patterns of migrant entrepreneurship in the global economy. Our theoretical framework builds on the resource-based view and highlights the role of the migrant enterprise as a collective entity endowed with peculiar tangible and intangible resources. The specific endowment of each migrant firm determines its competitive advantages and disadvantages, as well as its ability to acquire and process knowledge over time and internationalize. Such an approach allows to categorize the migrant enterprise as an autonomous entity, providing a reliable explanation of the heterogeneous features and performances displayed by these firms in the global economy. Indeed, even when migrant firms operate in the same host environment and are managed by entrepreneurs of the same ethnic background, their performances tend to be significantly different. Using a resource-based approach, the peculiar features of the migrant enterprise can be disentangled and explained more effectively.
    Keywords: Migrant entrepreneurship, Resorce-based View, Heterogeneity, Host Environment
    Date: 2023
  38. By: Tibor Hanappi; David Whyman
    Abstract: This paper investigates two closely related questions concerning the responses of Multi-National Enterprise (MNE) investment to corporate income taxation using a panel of unconsolidated subsidiary-level and consolidated group-level data from the ORBIS database. First, the paper provides new evidence on the heterogeneity of investment responses to taxation across multinational firms. This paper finds that profit shifting opportunities, access to credit, and market power at the group level are associated with decreased investment sensitivity to taxation among MNE subsidiaries. Second, a new empirical approach is used to investigate how tax changes at the host jurisdiction level affect investment at the MNE group level and whether there are propagation effects to foreign subsidiaries within the same MNE group. This paper finds that taxation in one jurisdiction in which an MNE is active is positively associated with investment in its subsidiaries in other jurisdictions. This finding suggests that the well-document negative relationship between taxation and MNE investment within a host jurisdiction masks the MNE rebalancing the location of its investment to other host jurisdictions in response to changes in cross-jurisdictional tax rate differentials rather than purely decreasing its investment globally.
    Keywords: investment, Multinational Enterprises, Taxation
    JEL: F21 H32 H25
    Date: 2023–07–27
  39. By: Rafael Dix-Carneiro; Brian K. Kovak
    Abstract: We survey the recent literature studying the effects of globalization on inequality in Latin America. Our focus is on research emerging from the late 2000s onward, with an emphasis on empirical work considering new mechanisms, studying new dimensions of inequality, and developing new methodologies to capture the many facets of globalization's relationship to inequality. After summarizing both design-based and quantitative work in this area, we propose directions for future work. Our overarching recommendation is that researchers develop unifying frameworks to help synthesize the results of individual studies that focus on distinct aspects of globalization's relationship to inequality.
    JEL: F14 F62 F66 J0 O10
    Date: 2023–07
  40. By: Nover, Justus
    Abstract: This paper examines how municipal taxes respond to the local impact of a labor market shock. The analysis exploits a commuting policy that liberalized cross-border labor markets between Switzerland and the EU. The reform was implemented at a time of skilled labor shortages and led to a substantial inflow of cross-border workers into Swiss border municipalities. Identification rests on exogenous regional variation in treatment intensities based on commuting times. The results show that corporate tax changes are significantly larger than zero in highly-treated border municipalities after the reform and when compared to less-affected regions. This is consistent with the theory according to which governments can tax rents that arise from productive location factors - an interpretation supported by several model extensions and robustness tests. The results on personal income taxation indicate a similar yet smaller and lagged response.
    Keywords: productive amenities, agglomeration, cross-border commuting, skill shortage, tax competition, Swiss-EU agreement
    JEL: H71 R23
    Date: 2023
  41. By: Alden, Christopher; le Pere, Garth
    Abstract: The shifting nature of contemporary global politics highlights the growing contestation about power and how it is distributed, with multipolarity as its hallmark and distinguishing feature. Amid the shift to multipolarity, new forms of multilateralism are emerging from the South, which are grounded in ‘institutional arrangements led by countries of the Global South’ in terms of the origin of initiatives, the drivers of such arrangements and the resources to sustain them. In this context, Southern Multilateralism offers a differ approach to classical Realist thinking where power is ‘the final arbiter of things political’. Southern Multilateralism has also given rise to new international institutional arrangements, such as the BRICS-led New Development Bank (NDB) and its predecessor, the India, Brazil and South Africa (IBSA) Trilateral Forum and the IBSA Fund Facility for Poverty and Hunger Alleviation. This article compares the IBSA and their Fund with the NDB and argues that there are continuities and linkages between the NDB and the IBSA Fund, which have yet to be examined by scholars; and to be more precise, the NDB has absorbed and reflects, key attributes of the IBSA and their Fund. Moreover, this study concludes by suggesting regional collaboration options for the NDB, led by South Africa, India and Brazil and their respective regions, whereby the NDB can expand its global role and relevance in future via its regional offices, particularly by supporting the regional trade integration plans in Africa, South Asia and South America.
    Keywords: Wiley deal
    JEL: J1 F3 G3
    Date: 2023–07–18
  42. By: Chantal Le Mouël (SMART - Structures et Marché Agricoles, Ressources et Territoires - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Rennes Angers - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement); Agneta Forslund (SMART - Structures et Marché Agricoles, Ressources et Territoires - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Rennes Angers - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement); Pauline Marty (UTT - Université de Technologie de Troyes); Stéphane Manceron (Direction de l'Expertise scientifique collective, de la Prospective et des Etudes - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Elodie Marajo-Petitzon (SMART - Structures et Marché Agricoles, Ressources et Territoires - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Rennes Angers - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement); Marc-Antoine Caillaud (Direction de l'Expertise scientifique collective, de la Prospective et des Etudes - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Patrice Dumas (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique, Cirad-ES - Département Environnements et Sociétés - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement); Bertrand Schmitt (CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro Dijon - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement)
    Abstract: The dependence on imports of the Middle East and North Africa (MENA) region for its food needs has increased steadily since the early 1960s, from 10% to about 40%. This import dependence could continue to rise in coming decades due to the projected MENA population growth and the expected negative impacts of climate change on the region's natural resources and agricultural performances. To what extent the food import dependency of the MENA region will continue to increase up to 2050 and how the region could mitigate its rising reliance on food imports is both a key question for the region itself and a crucial geopolitical issue for the world as a whole. In this paper, we use a biomass balance model to assess the level of the food import dependency of the MENA region in 2050 resulting from six scenarios. We show that under current trends and severe impacts of climate change the food import dependency of the MENA would continue to rise and reach 50% in 2050. Maghreb would be particularly affected becoming dependent on imports for almost 70% of its food needs. Adopting a Mediterranean diet, reaching faster productivity growth in agriculture or reducing waste and loss along the food chain would contribute to decelerate the rise of the MENA's food import dependency. However, only the combination of these three options could significantly offset the increased import dependency in the most affected sub-regions: Maghreb, the Middle and the Near East. In all scenarios, Turkey strengthens its position as a net exporter of agricultural products.
    Keywords: Food system, Agricultural production, Food diet, MENA, Scenarios, Biomass balance model
    Date: 2023–06
  43. By: Michael Funke; Kadri Männasoo; Helery Tasane
    Abstract: Recently, there has been a growing interest in newly developed econometric tools to conduct counterfactual analysis when a treated unit experiences a policy intervention, and an artificial control group has to be constructed. Adopting novel penalized synthetic control methods, we quantify the causal impact of the multi-modal Øresund fixed link on the adjacent cross-border regions in Skåne and Zealand. The treatment impacts on the intertwining metropolitan regions of Copenhagen and Malmö are positive. However, the impact on the Copenhagen metropolitan area is overlaid by the Great Belt strait fixed link, which was opened shortly before. An array of robustness tests supports our interpretations, and several appendices supplement the presentation in the paper.
    Keywords: Øresund fixed link, cities, infrastructure, economic development, synthetic control method
    JEL: C21 C54 H54 O11 R12 R42
    Date: 2023
  44. By: Chad P. Bown (Peterson Institute for International Economics)
    Abstract: South Korea felt "betrayed" when President Joseph R. Biden Jr. signed his administration's flagship climate legislation, the Inflation Reduction Act (IRA) of 2022, into law. This paper first shows how the Biden administration addressed Korea's concerns about the law's effect on its sales of electric vehicles (EVs) in the United States. Thanks in part to the Treasury Department's regulations written to implement the law, Korean exports of EVs to the United States grew even after the IRA went into force. Whether these actions by the Biden administration are enough to assuage the concerns of the Koreans--and other allies adversely affected by the IRA--remains to be seen. Furthermore, the US accommodation of Korean concerns came with tradeoffs by offsetting key incentives Congress may have intended in passing the IRA. The paper examines the potential impact of the law on South Korean battery companies, and it provides an initial exploration into how the Korean government responded to the IRA by adjusting its own policy mix of EV consumer tax credits and industrial policy for its EV plants and battery makers.
    Keywords: Electric vehicles, batteries, industrial policy, supply chains, climate, US, United States, South Korea
    JEL: L52 F13
    Date: 2023–07
  45. By: Hervé Lanotte (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne - MSH-URCA - Maison des Sciences Humaines de Champagne-Ardenne - URCA - Université de Reims Champagne-Ardenne); Aurélie Ringeval-Deluze (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne - MSH-URCA - Maison des Sciences Humaines de Champagne-Ardenne - URCA - Université de Reims Champagne-Ardenne); Erick Pruchnicki (UML - Unité de Mécanique de Lille - ULR 7512 - Université de Lille)
    Abstract: Analyses in terms of GVCs generally consider that the sharing of value is more favorable to leading firms than to subordinate firms, which may in turn lead the latter to adopt upgrading strategies with the aim of capturing a larger share of the value. However, by means of a dynamic model, we show that multi-annual supply contracts in the champagne industry, by favoring downstream investments of the leading firms (the houses), make it possible to create a higher value which, if it is partially transferred to the subordinate firms (the growers) via a higher price of grapes, contributes to stabilizing the organization of the industry by limiting the upgrading strategies of the latter. We thus contribute to the developing literature on GVCs and, in particular, to the question of value creation and distribution between leading and subordinate firms.
    Abstract: Les analyses en termes de CGV estiment généralement que le partage de la valeur est plus favorable aux firmes leaders qu'aux firmes subordonnées, ce qui peut en retour conduire ces dernières à adopter des stratégies d'upgrading afin notamment de capter une part plus grande de la valeur. Au moyen d'un modèle dynamique, nous montrons, au contraire, que les contrats pluriannuels d'approvisionnement dans la filière du champagne, en favorisant les investissements avals des firmes leaders (les maisons), permettent de créer une valeur supérieure qui, si elle est partiellement reversée aux firmes subordonnées (les vignerons) via un prix du raisin élevé, contribue à stabiliser l'organisation de la filière en limitant les stratégies d'upgrading de ces derniers. Nous contribuons ainsi à la littérature sur les CGV en traitant du sujet particulier de la création et de la répartition de la valeur entre firmes leaders et firmes subordonnées.
    Keywords: global value chains (GVCs), champagne industry, downstream investments, value creation, value distribution, contracts, dynamic models, Chaîne Globale de Valeur (CGV), filière champagne, investissements avals, création de valeur, répartition de la valeur, contrats, modèles dynamiques
    Date: 2022–05–31
  46. By: Casadei, Patrizia; Iammarino, Simona
    Abstract: Despite the rising interest for backshoring strategies by mass media, policy makers and public debates, academic research on the topic is relatively recent and still characterised by significant research gaps. Empirical evidence is scarce and often anecdotal, with a lack of studies focusing on specific industries and small-sized firms. Theoretical explanations are also fragmented with many unanswered questions. In particular, much of the existing literature has explored backshoring as a stand-alone phenomenon, independently from other production location strategies. In an attempt to fill these research gaps, we rely upon data from an original survey with around 700 firms from the UK textile and apparel industry to investigate different interrelated factors that influence backshoring strategies relative to offshoring and staying at home choices, within an analytical framework drawn from different international business perspectives, including operations and supply chain management. The paper contributes to the extant literature on backshoring by providing new empirical evidence based on originally collected firm-level data and focused on a single country and industry where smaller (and less studied) firms tend to prevail. Moreover, it helps strengthen the understanding of the phenomenon from a perspective which takes into consideration internationalisation as a non-linear process where firms adjust production location strategies based on a variety of changing conditions.
    Keywords: backshoring; reshoring; offshoring; production location strategies; survey research; textile & apparel; Springer deal
    JEL: R14 J01
    Date: 2023–07–14

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