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on International Trade |
| By: | Nana, Ibrahim; Tabe-Ojong, Martin Paul |
| Abstract: | Global value chains offer countries unique opportunities to participate in and benefit from international trade by specializing in specific production stages and tasks. We investigate the evolution of the integration of African countries into Global Value Chains (GVCs) and establish their relationship with economic growth and income inequality. Using recent export decomposition methods and world Input-Output tables from EORA-Multi-Region Input-Output Tables (MRIOs), we track the evolution of African countries along GVCs, identify specialization patterns and generate sector/task level "GVCs participation measures". We then use the GVCs participation measures to investigate the relationship between GVCs participation and position with economic growth and income inequality. We also explore which sectors explain these relationships. Our analysis is based on a panel data set constructed from a combination of different data sources of 48 African countries over the period 1990-2016. Using several empirical strategies, including a panel fixed effect estimator, instrumental variables, and local projection techniques, we find GVCs to be positively associated with both GDP per capita and income inequality for African countries. These results are consistent for GVCs position and different proxies of income inequality like income share and the standardized Gini coefficients. We also find suggestive evidence from the sectoral assessment of GVCs that this relationship may be driven by trade in knowledge-intensive goods and services. Based on these findings, we discuss some policy insights and implications, key of which is the importance in promoting GVCs and investments in knowledge intensive goods. To this end, various initiatives like skill upgrading, skill-based technological change and various education and labour market programs should take central stage. |
| Keywords: | Global Value Chains, Trade, Growth, Inequality, Africa |
| JEL: | F14 F15 F43 O55 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:sgscdp:284371&r=int |
| By: | Barry Eichengreen (NCAER and University of California, Berkeley) |
| Abstract: | Globalization is not over, but it is being reconfigured by events. Internationally, there are economic and political tensions between the United States and China. Both countries have responded with import tariffs, export controls, and foreign investment restrictions that have led to a decline in the relative importance of bilateral trade and the collapse of bilateral foreign direct investment. The paper concludes that globalization remains deeply entrenched despite the Global Financial Crisis, COVID, Russia’s invasion of Ukraine, and U.S.-China tensions. At the same time, the landscape of globalization has been changing in response to these events and specifically in response to U.S.-China rivalry. |
| Keywords: | Globalisation;Economic Growth |
| Date: | 2024–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:nca:ncaerw:161&r=int |
| By: | Jason Garred (Department of Economics, University of Ottawa, Ottawa, ON); Song Yuan (School of Economics, Zhejiang University) |
| Abstract: | The share of Chinese goods in US imports has fallen sharply since 2018, as production for the US market has shifted from China to other countries. Does this trend represent US-China ‘decoupling’, or are other US trade partners playing growing roles as intermediaries in ongoing US-China economic relations? Using firm-level and product-level data, we find that Chinese manufacturing investment and Chinese-produced parts have increasingly flowed to third-country ‘winners’ who have simultaneously increased their US market share. We present evidence that our findings capture expanding indirect relationships linking China and the US rather than broader economic trends within the ‘winners’ themselves. |
| Keywords: | Trade, China, FDI, global supply chains, relocation, decoupling. |
| JEL: | F14 F21 F23 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ott:wpaper:2401e&r=int |
| By: | Himanshu Jaiswal (Indira Gandhi Institute of Development Research); A. Ganesh Kumar (Indira Gandhi Institute of Development Research) |
| Abstract: | The import tariff system has made a harmful dent on the global trading system. To avoid this, many countries have chosen the second-best option- `an FTA'; because the first-best where there is no tariff at all in the global trading system is close to impossible to achieve. FTAs due to their structural factors like, stringent Rules of Origin and other non-tariff measures have not been very successful. Also, they have been labelled as discriminatory to non-partner countries. Despite having a potential of establishing and strengthening the Global value chains, FTAs have done a dismal work in dimension too. To overcome this limitation, we propose in this article a new mechanism called `Sectoral Trade Agreement (STA)' which is an FTA among all major producing countries in a particular sector or industry. An STA in automobile sector will be compared with the traditional bilateral FTA with different utilization rate. In our CGE based study, Welfare as a total rises in STA in comparison to FTA scenarios and this is increasing for some non-participating blocks also. It is also shown here how a composite scenario where both FTA and STA are functioning is a better option for trade liberalization and how this is a new 'second-best'. |
| Keywords: | Free Trade Agreement, Rules of Origin, Global Value Chain, Preference Utilization, CGE Analysis |
| JEL: | F13 F15 F17 F47 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2024-001&r=int |
| By: | Borchert, Lea; de Haas, Ralph; Kirschenmann, Karolin; Schultz, Alison |
| Abstract: | We exploit proprietary information on severed correspondent banking relationships (due to the stricter enforcement of financial crime regulation) to assess how payment disruptions impede cross-border trade. Using firm-level export data from emerging Europe, we show that when local respondent banks lose access to correspondent banking services, their corporate borrowers start to export less. This trade decline occurs on both the extensive and intensive margins, and firms only partially substitute these foregone exports with higher domestic sales. As a result, total firm revenues and employment shrink. These findings highlight an often overlooked function of global banks: providing the payment infrastructure and trade finance that enables firms in less-developed countries to export to richer parts of the world. |
| Keywords: | Correspondent banking, trade finance, de-risking, global banks, international trade, anti-money laundering |
| JEL: | F15 F36 G21 G28 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:283585&r=int |
| By: | Harstad, Bard (Stanford U) |
| Abstract: | International trade and natural resource exploitation interact in multiple ways. This paper first presents a dynamic game in which the South (S) exploits (e.g., deforests) in order to export (e.g., lumber or agricultural products). Because of negative externalities, the North might lose from trade, unless the resource has already been depleted. Anticipating this, S exploits more. All negative results are reversed if renegotiation-proof tariffs can be contingent on the size of the remaining resource stock. Larger gains from trade, and more attractive terms of trade, can be used to slow exploitation. Combined with export subsidies, the outcome is first best. |
| JEL: | F13 F18 F55 Q37 Q56 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:stabus:4127&r=int |
| By: | Roberto Alvarez; Eugenia Andreasen |
| Abstract: | In this paper, we examine the influence of Free Trade Agreements (FTAs) on Chilean exports during the past thirty years. Over the last three decades, Chile has entered into 31 FTAs with 65 countries, encompassing nearly 90% of global GDP. Despite this, there's a notable absence of empirical evidence regarding the extent and nature of the impact of these agreements on export volumes and product diversification. With a rich dataset encompassing bilateral trade flows at the product-level and key financial indicators, we employ a differencein-differences approach to provide robust evidence of the positive impact of these FTAs on export levels and the variety of products exported. Our analysis also reveals variations in these effects based on the industries' initial export share and trading partners' income levels. Furthermore, we investigate how FTAs interacted with the financial development and capital control policies of trading partners, demonstrating their role in mitigating financial constraints on trade. |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:udc:wpaper:wp555&r=int |
| By: | Tasso Adamopoulos; Fernando Leibovici |
| Abstract: | We study the role of international trade risk for food security, the patterns of production and trade across sectors, and its implications for policy. We document that food import dependence across countries is associated with higher food insecurity, particularly in low-income countries. We provide causal evidence on the role of trade risk for food security by exploiting the exogeneity of the Ukraine-Russia war as a major trade disruption limiting access to imports of critical food products. Using micro-level data from Ethiopia, we empirically show that districts relatively more exposed to food imports from the conflict countries experienced a significant increase in food insecurity by consuming fewer varieties of foods. Motivated by this evidence, we develop a multi-country multi-sector model of trade and structural change with stochastic trade costs to study the impact and policy implications of trade risk. In the model, importers operate subject to limited liability and trade off the production cost advantage against the risk of higher trade costs when sourcing goods internationally. We find that trade risk can threaten food security, with substantial quantitative effects on trade flows and the sectoral composition of economic activity. We study the desirability of trade policy and production subsidies in partially mitigating exposure to trade risk and diversifying domestic economic activity. |
| Keywords: | food security; trade; risk; structural change; productivity |
| JEL: | E10 F10 F60 I30 O11 O41 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:97907&r=int |
| By: | Salles, Fernanda Cimini; Bayerlein, Michael; Villarreal, Pedro A.; Schwebel, Franziska |
| Abstract: | The European Union's (EU) Global Health Strategy calls for open and strategic autonomy in the field of pharmaceuticals, which would lead to the redesign of EU global supply and value chains as well as trade relations. As the EU and Germany are seeking to diversify their trade partners, the Mercosur countries offer latent potential. Mercosur is the name of the South American trade bloc consisting of Argentina, Brazil, Paraguay and Uruguay, with Venezuela's membership currently suspended. The associate states of the bloc are Chile, Peru, Colombia, Ecuador, Guyana and Suriname. Bolivia is currently awaiting final approval to become a full member of the bloc. |
| Keywords: | pharmaceutical supply chains, Mercosur countries, EU's Global Health Strategy, Argentina, Brazil, Paraguay, Uruguay, Chile, Peru, Colombia, Ecuador, Guyana, Suriname, Bolivia, free trade agreement (FTA), European Medicines Agency (EMA), Health Emergency Preparedness and Response Authority (HERA) |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:swpcom:284705&r=int |
| By: | Elsig, Manfred; Ganeson, Kirthana; Jusoh, Sufian; Lugg, Andrew |
| Abstract: | Abstract The Regional Comprehensive Economic Partnership (RCEP) is one of the most important mega-regional trade agreements signed to date. Yet, it failed to include an Investor-State Dispute Settlement (ISDS) mechanism in its investment chapter. What explains this omission? To unpack this, we examine international negotiations as a two-step process. In the first stage, we theorize that initial preferences towards ISDS are based on countries’ orientation toward foreign direct investment (FDI), experience with ISDS, and past treaty practice. Second, we theorize that during protracted negotiations, adverse regime developments and domestic politics can have a profound impact on treaty design. To test our framework, we examine the RCEP negotiations. Our analysis shows that mounting cases as well as the eroding norm of ISDS in other treaties lowered support for ISDS as the negotiations progressed. Then, a change of government in Malaysia shifted that country’s position dramatically, which tipped the balance against ISDS in the final round of negotiations. Our findings have important implications for the international investment regime. They highlight the factors that determine countries’ initial preferences while also demonstrating the importance of developments during the negotiations, which can lead to the abandonment of the institutional status quo. |
| Date: | 2024–03–19 |
| URL: | http://d.repec.org/n?u=RePEc:wti:papers:1436&r=int |
| By: | Jakub Lonsky; Isabel Ruiz; Carlos Vargas-Silva |
| Abstract: | The role of ethnic immigrant networks in facilitating international trade is a well-established phenomenon in the literature. However, it is less clear whether this relationship extends to illegal trade and unauthorized immigrants. In this paper, we tackle this question by focusing on the case of the heroin trade and unauthorized Chinese immigrants in the early 1990s United States. Between mid-1980s and mid-1990s, Southeast Asia became the dominant source of heroin in the US. Heroin from this region was trafficked into the US by Chinese organized criminals, whose presence across the country can be approximated by the location of unauthorized Chinese immigrants. Instrumenting for the unauthorized Chinese immigrant enclaves in 1990 with their 1900 counterpart, we first show that Chinese presence in a community led to a sizeable increase in local opiates-related arrests, a proxy for local heroin markets. This effect is driven by arrests for sale/manufacturing of the drugs. Next, we examine the consequences of Chinese-trafficked heroin by looking at its impact on US Vietnam-era veterans – a group particularly vulnerable to heroin addiction in the early 1990s. Using a triple-difference estimation, we find mostly small but statistically significant detrimental effects on labor market outcomes of Vietnam veterans residing in unauthorized Chinese enclaves in 1990. |
| Keywords: | Trade networks, heroin markets, Vietnam veterans, labor market outcomes |
| JEL: | F16 F22 J15 K42 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:liv:livedp:202203&r=int |
| By: | Luca Léry Moffat; Niclas Poitiers |
| Abstract: | This paper revisits the effects of three shocks on the functioning of global supply chains. |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:node_9784&r=int |
| By: | Benny Kleinman (University of Chicago); Ernest Liu (Princeton University and NBER); Stephen J. Redding (Princeton University, NBER and CEPR); Motohiro Yogo (Princeton University and NBER) |
| Abstract: | We generalize the closed-economy neoclassical growth model (CNGM) to allow for costly goods trade and capital flows with imperfect substitutability between countries. We develop a tractable, multi-country, quantitative model that matches key features of the observed data (e.g., gravity equations for trade and capital holdings) and is well suited for analyzing counterfactual policies that affect both goods and capital market integration (e.g., U.S.-China decoupling). We show that goods and capital market integration interact in non-trivial ways to shape impulse responses to counterfactual changes in productivity and goods and capital market frictions and the speed of convergence to steady-state. |
| Keywords: | Economic Growth, International Trade, Capital Flow |
| JEL: | F10 F21 F60 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:pri:cepsud:318&r=int |
| By: | Javad Shamsi |
| Abstract: | This paper examines how immigration reshapes political landscapes, centring on the influx of immigrants from the EU's 2004 enlargement and its implications for the UK. I use a new variation in exposure to immigration based on migrant flows across various industries coupled with the employment structure in each region. Addressing potential concerns of endogeneity, I introduce a novel shift-share IV design, harnessing the industry-specific flow of migrants to regions outside the UK within the pre-2004 EU. The findings reveal a significant impact on support for the right-wing UK Independence Party and the Brexit Leave campaign, accompanied by a decline in Labour Party support. Moreover, the research indicates that voters' social attitudes toward immigration become more adverse in response to immigration. Political parties, particularly Conservatives, are also observed to increasingly engage with the topic of immigration in constituencies most affected by immigration, typically marked by negative rhetoric. The paper reconciles these findings by highlighting how immigration shocks entrench immigration cleavage, realigning political conflict from traditional economic lines to new cultural dimensions. |
| Keywords: | immigration, political realignment, industry-specific migration, EU enlargement |
| Date: | 2024–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1983&r=int |
| By: | Chad P. Bown (Peterson Institute for International Economics) |
| Abstract: | This paper surveys the economics of industrial policy as it relates to the World Trade Organization (WTO). Motivated by concern that the modern use of industrial policy is emerging in ways that threaten cooperation in the international trading system, the paper begins with the basic historical economic framework for tying industrial policy to underlying market failures. It then introduces the dominant economic understanding of the role played by the WTO, it examines the WTO's rules on subsidies (and thus industrial policy), the unease with the evolution of the trading system's subsidy rules, gaps in knowledge, and important data and measurement shortcomings. The main part of the paper examines four areas motivating why modern industrial policy is different and why it has become so important for the trading system: China, supply chain resilience, supply chain responsiveness, and climate change. The paper identifies the evidence to date, open questions, and potential paths forward for economic research to help inform policymaker efforts to restore international economic cooperation in trade and industrial policy. |
| Keywords: | WTO, industrial policy, subsidies, China, supply chains, resilience, climate change |
| JEL: | F13 L52 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:iie:wpaper:wp23-15&r=int |
| By: | Garcés Iriarte, Irene; Vogt, Achim |
| Abstract: | Abstract With falling tariffs the role of regulatory heterogeneity in international trade has become central in recent debates about regional integration and trade costs. In describing the NTM incidence few studies explicitly take into account the specific nature of underlying regulatory differences. We propose distinguishing regulatory heterogeneity with respect to the intensity, coverage, and structure of regulations, and present indicators reflecting each one of these dimensions. Enabled by detailed product-level regulatory data based on coded reviews of national legislation, we illustrate the different channels of regulatory heterogeneity on the country- and sector-level. The findings motivate a separate treatment of the different heterogeneity dimensions in the assessment of non-tariff measures in international trade. About the authors Irene Garcés and Achim Vogt |
| Date: | 2024–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:wti:papers:1435&r=int |
| By: | Timothy J. Hatton |
| Abstract: | From 1860 to 1913 the six colonies that became states of Australia strove to attract migrants from the UK with a variety of assisted passages. The colonies/states shared a common culture and sought migrants from a common source, the UK, but set policy independently of each other. This experience provides a unique opportunity to examine the formation of assisted immigration policies. Using a panel of colonies/states over the years 1862 to 1913 I investigate the association between measures of policy activism and a range of economic and political variables. Assisted migration policies were positively linked with government budget surpluses and local economic prosperity. They were also associated with political participation including the widening of the franchise and remuneration of members of parliament. While the reduction in travel time to Australia reduced the need for assisted migration, slumps in the UK increased the take-up of assisted passages. |
| Keywords: | Colonial Australia, Assisted passages, International migration |
| JEL: | F22 N37 N47 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:auu:hpaper:119&r=int |
| By: | Best, Frank |
| Abstract: | In order to avoid carbon leakage, the EU decided to introduce the Carbon Border Adjustment Mechanism to put a fair price on embedded carbon emissions of products imported into the EU. Once the CBAM is operational, importing companies will have to declare the embedded emissions for their products and surrender the corresponding amount of CBAM certificates. Taiwan is an important trade partner of the EU, especially for electronic components, and also for base metals like Iron & Steel or Aluminium. The industrial manufacturing for base metals yields high Scope 1 greenhouse gas emissions; additionally, power generation in Taiwan relies heavily on fossil fuels. This paper identifies the Iron & Steel product flows from Taiwan to the EU. It describes the CBAM requirements and the potential impact on Taiwanese Iron & Steel exports, pointing out challenges and opportunities. It intends to support Taiwanese companies to prepare for CBAM rules both during the transition phase and once the system is fully active. |
| Abstract: | Um Carbon Leakage zu vermeiden, beschloss die EU den Carbon Border Adjustment Mechanism (CBAM) als Grenzausgleichsmechanismus einzuführen, um CO2-Emissionen von Produkten, die in die EU importiert werden, fair zu bepreisen. Sobald der CBAM funktionsfähig ist, müssen importierende Unternehmen die entstandenen Emissionen für ihre Produkte deklarieren und die entsprechende Menge an CBAM-Zertifikaten abgeben. Taiwan ist ein wichtiger Handelspartner der EU, insbesondere für elektronische Komponenten, aber auch für Grundstoffe wie Eisen & Stahl oder Aluminium. Die industrielle Herstellung dieser Produkte führt zu hohen Scope-1-Treibhausgasemissionen; zusätzlich basiert die Stromerzeugung in Taiwan stark auf fossilen Brennstoffen. Dieses Papier identifiziert die Importströme von Eisen & Stahl von Taiwan in die EU. Es beschreibt die Anforderungen des CBAM und die potenziellen Auswirkungen auf die Exporte von taiwanesischem Eisen & Stahl und zeigt Herausforderungen und Chancen auf. Es zielt darauf ab, taiwanesische Unternehmen dabei zu unterstützen, sich sowohl während der Übergangsphase als auch nach der vollständigen Inbetriebnahme des Systems auf die CBAM-Regeln vorzubereiten. |
| Keywords: | CBAM, Carbon Border Adjustment Mechanism, Emission Intensity, Emission Trading Scheme, EU-ETS, Imports, Iron, Steel, Taiwan, TSCE |
| JEL: | F14 H23 M16 L61 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esconf:285308&r=int |
| By: | Célestin Coquidé (UTINAM - Univers, Transport, Interfaces, Nanostructures, Atmosphère et environnement, Molécules (UMR 6213) - INSU - CNRS - Institut national des sciences de l'Univers - CNRS - Centre National de la Recherche Scientifique - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE], DM2L - Data Mining and Machine Learning - LIRIS - Laboratoire d'InfoRmatique en Image et Systèmes d'information - UL2 - Université Lumière - Lyon 2 - ECL - École Centrale de Lyon - Université de Lyon - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - INSA Lyon - Institut National des Sciences Appliquées de Lyon - Université de Lyon - INSA - Institut National des Sciences Appliquées - CNRS - Centre National de la Recherche Scientifique, LIRIS - Laboratoire d'InfoRmatique en Image et Systèmes d'information - UL2 - Université Lumière - Lyon 2 - ECL - École Centrale de Lyon - Université de Lyon - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - INSA Lyon - Institut National des Sciences Appliquées de Lyon - Université de Lyon - INSA - Institut National des Sciences Appliquées - CNRS - Centre National de la Recherche Scientifique); José Lages (UTINAM - Univers, Transport, Interfaces, Nanostructures, Atmosphère et environnement, Molécules (UMR 6213) - INSU - CNRS - Institut national des sciences de l'Univers - CNRS - Centre National de la Recherche Scientifique - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE]); Dima Shepelyansky (LPT - Laboratoire de Physique Théorique - UT3 - Université Toulouse III - Paul Sabatier - UT - Université de Toulouse - CNRS - Centre National de la Recherche Scientifique - FeRMI - Fédération de recherche « Matière et interactions » - INSA Toulouse - Institut National des Sciences Appliquées - Toulouse - INSA - Institut National des Sciences Appliquées - UT - Université de Toulouse - UT3 - Université Toulouse III - Paul Sabatier - UT - Université de Toulouse - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We extend the opinion formation approach to probe the world influence of economical organizations. Our opinion formation model mimics a battle between currencies within the international trade network. Based on the United Nations Comtrade database, we construct the world trade network for the years of the last decade from 2010 to 2020. We consider different core groups constituted by countries preferring to trade in a specific currency. We will consider principally two core groups, namely, five Anglo-Saxon countries that prefer to trade in US dollar and the 11 BRICS+ that prefer to trade in a hypothetical currency, hereafter called BRI, pegged to their economies. We determine the trade currency preference of the other countries via a Monte Carlo process depending on the direct transactions between the countries. The results obtained in the frame of this mathematical model show that starting from the year 2014, the majority of the world countries would have preferred to trade in BRI than USD. The Monte Carlo process reaches a steady state with three distinct groups: two groups of countries preferring to trade in whatever is the initial distribution of the trade currency preferences, one in BRI and the other in USD, and a third group of countries swinging as a whole between USD and BRI depending on the initial distribution of the trade currency preferences. We also analyze the battle between three currencies: on one hand, we consider USD, BRI and EUR, the latter currency being pegged by the core group of nine EU countries. We show that the countries preferring EUR are mainly the swing countries obtained in the frame of the two currencies model. On the other hand, we consider USD, CNY (Chinese yuan), OPE, the latter currency being pegged to the major OPEC+ economies for which we try to probe the effective economical influence within international trade. Finally, we present the reduced Google matrix description of the trade relations between the Anglo-Saxon countries and the BRICS+. |
| Date: | 2024–02–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04461784&r=int |
| By: | Timothy J Hatton |
| Abstract: | Studies of the determinants of emigration from Europe from 1850 to 1913 include the gains to migrants but often neglect the costs. One component of those costs is earnings forgone on the voyage. In this paper I present new data on the voyage times for emigrants from the UK traveling to the United States and to Australia. Between 1853-7 and 1909-13 the voyage time from Liverpool to New York fell from 38 days to just 8 days (or 79%). Over the same years, the emigrant voyage to Sydney fell by more in absolute terms, from 105 days to 46, but by less in relative terms (56%). Differences in profiles of travel times are explained with a focus on the relative efficiency of sail and steam and (for Australia) the use of the Suez Canal. Data series for fare prices and foregone wage costs are combined to create new series on the ‘total’ cost of emigrant voyages. Econometric analysis of UK emigration to the US, Canada and Australia supports the view that time costs mattered. |
| Keywords: | International migration, Steam ships, Voyage times |
| JEL: | F22 O33 N73 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:auu:hpaper:120&r=int |
| By: | Cipollina, Maria; De Benedictis, Luca; Scibè, Elisa |
| Abstract: | The article provides cross-sectional evidence of domestic and international human migration associated with environmental shocks, with a specific emphasis on genderspecific heterogeneity and geographical distance. Both sudden and gradual environmental changes may influence the decision to migrate. However, the response is conditional to the cost and opportunity to move, which can vary based on gender and the distance between the location affected by the environmental shock and the hosting destination, within the country or internationally. Using the 5-year estimates of internal and international domestic migration flow disaggregated by sex, representative of the period 2005-2010, we estimate a structural gravity model and we find that migration can be influenced by environmental risks, as people may seek safer or more stable environments when their home regions are prone to disasters, albeit differently for each gender, both within a country and across borders. |
| Keywords: | Migration; Climate change; Natural disasters; Gender; Structural Gravity model. |
| JEL: | C13 F22 J61 Q51 Q54 Q56 |
| Date: | 2024–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:mol:ecsdps:esdp24093&r=int |
| By: | Best, Frank |
| Abstract: | In its “Fit for 55” program, the European Union (EU) integrates several instruments with the goal of achieving climate neutrality by 2050. One of the cornerstones of the program is the EU Emissions Trading System (EU-ETS), which imposes a levy on CO2 and other greenhouse gas (GHG) emissions, thus internalizing external costs, restoring fair competition, incentivizing sustainable investment and efficiently distributing the remaining greenhouse gas budget through a cost-effective, market-oriented mechanism. This carbon pricing scheme, however, only affects companies which emit GHGs within the EU. Imported products thereby achieve a cost advantage over products produced within the scope of the EU-ETS, leading to competitive pressure on EU-ETS companies and the risk that they might move production facilities outside the scope of the EU-ETS (“carbon leakage”). In order to avoid carbon leakage and encourage cleaner industrial production in partner countries, the EU decided to introduce the Carbon Border Adjustment Mechanism (CBAM) to put a fair price on carbon emissions from the manufacturing of products imported into the EU. The CBAM transitional phase will go into effect on October 1, 2023. Initially, it will only apply to selected industrial products and precursors whose production is particularly carbon intensive and which are deemed to have the highest potential risk of carbon leakage. Once the CBAM is fully active, all importing companies will have to declare the embedded emissions for their products and surrender the corresponding amount of CBAM certificates. It is to be expected that importing companies will strongly rely on their international suppliers to provide information on the embedded emissions. India is both an important trade partner of the EU and, because of its strong reliance on coal power plants, a heavy greenhouse gas emitter both in absolute and relative terms. Importers of products from India into the EU will therefore have to purchase a significant number of carbon allowances under the CBAM regulations. This paper explains the functional mechanism of the CBAM and identifies the product flows from India to the EU for the affected products. It describes the product groups, their importance for Indian companies as well as the future requirements, and is intended to support Indian companies that export to the European Union to prepare for the CBAM requirements both during the transition phase and once the system is fully active. |
| Abstract: | Im Rahmen ihres Programms "Fit for 55" integriert die Europäische Union (EU) mehrere Instrumente mit dem Ziel, bis 2050 Klimaneutralität zu erreichen. Einer der Eckpfeiler des Programms ist das EU-Emissionshandelssystem (EU-ETS), das eine Abgabe auf CO2 und andere Treibhausgasemissionen erhebt und somit externe Kosten internalisiert, fairen Wettbewerb wiederherstellt, nachhaltige Investitionen anregt und das verbleibende Treibhausgasbudget durch einen kosteneffizienten, marktorientierten Mechanismus effizient verteilt. Dieses System zur Bepreisung von Kohlenstoffemissionen betrifft jedoch nur Unternehmen, die Treibhausgase innerhalb der EU emittieren. Importierte Produkte erlangen dadurch einen Kostenvorteil gegenüber europäischen Produkten, was zu Wettbewerbsdruck auf EU-Unternehmen führt. Dieser Druck birgt das Risiko der Verlagerung von Produktionsstätten außerhalb des EU-ETS-Bereichs verlagern ("Carbon Leakage"). Um Carbon Leakage zu vermeiden und eine emissionsarme Produktion in Partnerländern zu fördern, beschloss die EU, den Carbon Border Adjustment Mechanism (CBAM) einzuführen, um einen fairen Preis für CO2-Emissionen importierter Produkte festzulegen. Die Übergangsphase des CBAM ist am 1. Oktober 2023 in Kraft getreten. Anfangs gilt der CBAM nur für ausgewählte Industrieprodukte und Vorprodukte, deren Produktion besonders kohlenstoffintensiv ist und die als besonders gefährdet für Carbon Leakage gelten. Sobald der CBAM vollständig aktiv ist, müssen alle importierenden Unternehmen die eingebetteten Emissionen für ihre Produkte deklarieren und die entsprechende Menge an CBAM-Zertifikaten abgeben. Es ist zu erwarten, dass importierende Unternehmen stark auf ihre internationalen Lieferanten angewiesen sein werden, um Informationen zu den eingebetteten Emissionen bereitstellen zu können. Indien ist sowohl ein wichtiger Handelspartner der EU als auch aufgrund seiner starken Abhängigkeit von Kohlekraftwerken ein siginifikanter Treibhausgasemittent. Importeure von Produkten aus Indien in die EU werden daher unter den CBAM-Vorschriften eine signifikante Anzahl von Kohlenstoffzertifikaten erwerben müssen und abgeben müssen. Dieser Artikel erklärt den funktionalen Mechanismus des CBAM und identifiziert die Produktströme von Indien in die EU für die betroffenen Produkte. Er beschreibt die Produktgruppen, ihre Bedeutung für indische Unternehmen sowie die zukünftigen Anforderungen und soll indischen Unternehmen, die in die Europäische Union exportieren, dabei helfen, sich auf die CBAM-Anforderungen sowohl während der Übergangsphase als auch bei vollständiger Inbetriebnahme des Systems vorzubereiten |
| Keywords: | Aluminium, CBAM, Carbon Border Adjustment Mechanism, Carbon Intensity, Emission Trading Scheme, EU-ETS, India, Imports, Iron & STeel |
| JEL: | Q56 F13 Q58 F18 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esrepo:285311&r=int |
| By: | Könneke, Jule; Adolphsen, Ole |
| Abstract: | The outcome of the 28th UN Climate Change Conference shows that international cooperation remains possible despite today's challenging geopolitical situation. Instead of the feared blockade, an agreement was reached for the first time - some three decades after the start of the COP process - to move away from fossil fuels in energy systems. Overall, the steps agreed in Dubai are a compromise that sends a political signal short of what is necessary from a scientific perspective. On the one hand, international climate cooperation continues to be characterized by traditional conflicts between developing countries and industrialized nations (issues of global justice, financial commitments), with new trade tensions and what at times amounted to an obstructionist attitude among a handful of countries compounding the difficulties. On the other hand, dynamic North-South coalitions have formed in the negotiation tracks on 'loss and damage' and the global energy transition. These must be further strengthened as the starting point for lasting alliances against fossil fuel interests. German climate foreign policy can make an important contribution by undertaking consistent diplomatic efforts to implement structural reforms of the international financial system and by offering attractive partnerships. |
| Keywords: | World Climate Conference, COP28, Global North, Global South, Russia's war of aggression against Ukraine, energy security, Global Stocktake (GST), nationally determined contributions (NDCs), carbon border adjustment mechanism (CBAM), Intergovernmental Panel on Climate Change (IPCC) |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:swpcom:284703&r=int |
| By: | Elizabeth Steiner |
| Abstract: | This paper estimates the impact of exchange rate fluctuations on markups. Firm-level markups are estimated for a comprehensive panel of Swiss manufacturing firms for the period 2012-2017 using a production-function approach. The pass-through of the exchange rate is then estimated using an event-study design exploiting the large, sudden and persistent appreciation of the Swiss franc against the euro in January 2015. The results show that following an appreciation, Swiss manufacturing firms adjust their markup very heterogeneously. Large firms, especially those that invoice in foreign currency or are highly profitable, substantially decrease their markup. Owing to their sheer size, large firms shape the aggregate response. In contrast, the average firm does not respond significantly. This suggests that smaller firms, which are in the majority, are either unable or unwilling to absorb exchange rate movements by adjusting their markup. |
| Keywords: | Markup, Exchange rate, Pass-through, Firm-level data |
| JEL: | D22 D24 F12 F14 F41 F23 L11 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:snb:snbwpa:2024-02&r=int |
| By: | Francesco Zanetti; Xiwen Bai; Jesús Fernández-Villaverde; Yiliang Li |
| Abstract: | Westudy the causal effects and policy implications of global supply chain disruptions. We construct a new index of supply chain disruptions from the mandatory automatic identification system data of container ships, developing a novel spatial clustering algorithm that determines real-time congestion from the position, speed, and heading of container ships in major ports around the globe. We develop a model with search frictions between producers and retailers that links spare productive capacity with congestion in the goods market and the responses of output and prices to supply chain shocks. The co-movements of output, prices, and spare capacity yield unique identifying restrictions for supply chain disturbances that allow us to study the causal effects of such disruptions. We document how supply chain shocks drove inflation during 2021 but that, in 2022, traditional demand and supply shocks also played an important role in explaining inflation. Finally, we show how monetary policy is more effective in taming inflation after a global supply chain shock than in regular circumstances. |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:cnn:wpaper:24-003e&r=int |
| By: | Niclas Poitiers; Kamil Sekut |
| Abstract: | Our main message is that policies restricting knowledge flows should be limited to narrowly defined areas of strategic importance. |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:node_9781&r=int |
| By: | von Graevenitz, Kathrine; Rottner, Elisa; Richter, Philipp M. |
| Abstract: | Relative prices determine competitiveness of different locations. In this paper, we focus on the role of regulatory differences between Germany and other EU countries which affect the shadow price of carbon emissions. We calibrate a Melitz-type model, extended by firms' emissions and abatement decisions using data on aggregate output, trade and emissions. The parameter estimates are estimated from the German Manufacturing Census. The quantitative model allows us to recover a measure of how regulatory stringency evolved in the EU and Germany in terms of an implicit carbon price paid on emissions. This price reflects energy and carbon prices in addition to command-and-control measures and decreased from 2005 to 2019 in most sectors - both in Germany and other EU countries. The trend is more pronounced in Germany than in the rest of the EU. In counterfactual analyses, we show that this intra-EU difference has substantially increased German industrial emissions. Had the EU experienced the same decrease in implicit carbon prices as Germany, German emissions would have been substantially lower. Germany has increasingly become a pollution haven |
| Keywords: | Carbon emissions, Climate Policy, Melitz model, Manufacturing |
| JEL: | F18 H23 L60 Q56 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:283591&r=int |
| By: | Thiratayakinant, Kraijakr |
| Abstract: | The asymmetric nature of international investment agreements whereby home and host states agree on each other's obligation to protect their respective investors while the investors undertake few, if any, obligations has resulted in something of a legitimacy crisis. This Perspective proposes a practical and readily implementable solution. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:colfdi:284731&r=int |
| By: | García-Suaza, Andrés (Facultad de Economía Universidad del Rosario); Mondragón-Mayo, Angie (Facultad de Economía Universidad del Rosario); Sarango-Iturralde, Alexander (Université Paris1 Panthéon-Sorbonne) |
| Abstract: | Immigration policies prioritize labor market integration, aiming for high employment rates and leveraging migrant skills to enhance host country productivity. However, migrants often face entry barriers and human capital misallocation. This article examines the occupational downgrading of Venezuelan migrants in Colombia and assesses the impact of work permit policies on mitigating this trend. Our empirical findings highlight significant occupation downgrading, prompting an exploration of the role of work permits. The analysis indicates that permits have expanded employment prospects for migrants who were previously unemployed or engaged in blue-collar jobs, mainly for females and the youngest population. While permits do not significantly reduce occupation downgrading they are associated with more formal job search mechanisms. Moreover, our findings show no significant impact of work permits on the intensity of routinization; instead, there is an increase in the intensity of non-routine analytic and interactive tasks among the youngest workers. This suggests that permits could be complemented with additional instruments to enhance migrant matching in the labor market. |
| Keywords: | Migration; occupational downgrading; labor mobility; work permits |
| JEL: | F22 J24 J61 O15 |
| Date: | 2024–02–19 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:021028&r=int |
| By: | Gabriel Chodorow-Reich; Matthew Smith; Owen M. Zidar; Eric Zwick |
| Abstract: | We evaluate the 2017 Tax Cuts and Jobs Act. Combining reduced-form estimates from tax data with a global investment model, we estimate responses, identify parameters, and conduct counterfactuals. Domestic investment of firms with the mean tax change increases 20% versus a no-change baseline. Due to novel foreign incentives, foreign capital of U.S. multinationals rises substantially. These incentives also boost domestic investment, indicating complementarity between domestic and foreign capital. In the model, the long-run effect on domestic capital in general equilibrium is 7% and the tax revenue feedback from growth offsets only 2p.p. of the direct cost of 41% of pre-TCJA corporate revenue. |
| JEL: | E22 F21 F23 H0 H25 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32180&r=int |
| By: | Bekkers, Eddy; Yilmaz, Ayse Nihal; Bacchetta, Marc; Ferrero, Mateo; Jhunjhunwala, Kirti; Métivier, Jeanne; Okogu, Bright E.; Ramos, Daniel; Tresa, Enxhi; Xu, Ankai |
| Abstract: | We explore a global carbon pricing framework to inform the potential coordination of carbon pricing and equivalent policies. The framework has three main features aligning with the current multilateral system for climate action. First, the carbon price is determined by a global average carbon price to achieve emission reductions required to remain on a 1.5-2 degrees Celsius global warming trajectory. The framework further incorporates a set of economy-level criteria determining variation in carbon prices between economies: historical emissions, the current level of economic development, and the economic costs of climate change. Second, a moderate share of carbon pricing revenues is allocated to support lower-income economies, economies with higher costs of climate change and economies with higher economic costs of carbon pricing. Third, the framework allows economies to achieve equivalent carbon emission reductions through the implementation of alternative policy instruments. Simulations with the Global Trade Model show that, under the framework, the projected economic costs of carbon pricing are in proportion to the economy-level criteria, implying higher costs for economies with higher historical emissions, a higher level of development and lower projected costs of climate change. The projected reduction in output and exports in emission-intensive trade-exposed sectors (EITEs) displays only a weak negative correlation with the carbon price level. The framework is not meant as a policy proposal but as a contribution to the discussion on coordination of carbon pricing policies. Such coordination can help to inform the discussion about policy options to prevent fragmentation of carbon pricing and other climate change mitigation policies. Such fragmentation is costly and could lead to the introduction of complementary policies which could come with trade frictions. |
| Keywords: | Carbon pricing, Climate change mitigation, CGE Models |
| JEL: | C68 F18 Q54 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:285362&r=int |
| By: | Jeong Lee, So; Jin Seo, Su |
| Abstract: | The rapid evolution of digital technologies has reshaped global business, forcing not only large but also small and medium-sized enterprises (SMEs) to embrace digital trade. Nevertheless, many SMEs are struggling to fully implement digital technologies. Against this backdrop, the Republic of Korea has bolstered its support for SMEs, with a focus on human capital development, financing, and research and development. Furthermore, the country has revised its trade regulations and frameworks, placing significant emphasis on digital capacity-building and the alignment of regulations with international standards. Despite the disparities in digital infrastructure and skills, the experience of the Republic of Korea is a useful model for Latin America and the Caribbean, offering invaluable insights for policymakers, businesses and stakeholders seeking to navigate the evolving digital landscape and facilitate SME growth and internationalization. In addition, deeper collaboration could be pursued between the Republic of Korea and the region, in particular in the realms of expanding and enhancing access to information and communications technologies (ICTs), upskilling the workforce, strengthening data protection and broadening the scope of trade to include digital services. |
| Date: | 2024–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:ecr:col022:68876&r=int |
| By: | Berger, Valentin; Bjerre, Liv; Breyer, Magdalena; Helbling, Marc; Römer, Friederike; Zobel, Malisa |
| Abstract: | The Immigration Policies in Comparison (IMPIC) database includes data on migration policies for 33 OECD countries and the period 1980-2018. The dataset is presented in Helbling, Marc, Liv Bjerre, Friederike Römer and Malisa Zobel (2016) "Measuring Immigration Policies: The IMPIC-Database", European Political Science 16 (1): 79-98. This technical report provides additional information on the data collection (part 1), the codebook of the dataset (part 2), a glossary that defines the relevant terms and concepts that have been used (part 3) and the questionnaire that has been used to collect the data (part 4). This second version of the technical report also includes information on the update of the dataset for the years 2011-2018. |
| Keywords: | immigration, policy, measurement, aggregation |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbdiv:spvi2016201r&r=int |
| By: | Biljana Meiske |
| Abstract: | This work studies the dynamics of inter-minority relations and attempts to uncover the influence of status position of the established immigrants on their attitudes towards new waves of immigration. I hypothesize that relative status deprivation, that is, the degree to which own in-group is ranked low in the ethnic status hierarchy of the host country, has a negative impact on group members’ attitudes toward an even lower ranked status group (such as refugees). In an online experiment (N=1, 159), participants with migration background residing in Germany receive either a positive or a negative evaluation of their own ethnic/national in-group, as evaluated by a group of ethnic German participants, while keeping constant the evaluations of other immigrant groups. The results show that participants whose in-group received a negative evaluation are systematically less willing to donate to an organization supporting refugees. Furthermore, receiving negative evaluation impacts participants’ perceived descriptive norms regarding expression of non-acceptance of refugees (and other low-status out-groups) among majority population. Additionally, I study the role of indirect reciprocity as a possible moderator of observed treatment effects. |
| Keywords: | Immigration attitudes, Discrimination, Status |
| JEL: | C90 J15 J71 |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:mpi:wpaper:tax-mpg-rps-2022-12&r=int |
| By: | Di Girolamo, Valentina; Mitra, Alessio; Ravet, Julien; Peiffer-Smadja, Océane; Balland, Pierre-Alexandre |
| Abstract: | This paper studies the relationship between knowledge complexity and countries' technological dependency, with a focus on the EU's position vis-à-vis other major economies. Using patent data, we calculate the knowledge complexity index at technological level for a set of countries over the period 1990-2020 to assess the EU's technological capabilities. Our findings show that the EU's overall position has progressively worsened vis-à-vis the US, China, Japan, and South Korea over the last three decades, that the EU's technological base is more diversified than that of other major economies, but is disproportionally more specialised in less complex technologies than its counterparts. Finally, the EU is particularly dependent on just a few countries in most complex technologies. |
| Keywords: | Complex technologies, Technological dependencies, Strategic autonomy, Relatedness |
| JEL: | O11 O33 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:283907&r=int |
| By: | Ziyaeva, Diora; Anthony, Cody |
| Abstract: | The International Seabed Authority recently concluded its yearly meeting without finalizing a formal Mining Code for the deep seabed. This Perspective considers the impact of the lack of a Mining Code and provides recommendations for developing countries seeking to conduct deep sea mining projects. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:colfdi:284732&r=int |