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on International Trade |
| By: | Feenstra, Robert C.; Heston, Alan; Timmer, Marcel P.; Deng, Haiyan |
| Abstract: | From its inception, the Penn World Tables (PWT), building on the International Comparisons Program (ICP) of the United Nations, has sought to compare the standard of living of individuals in different countries. That is, the term " real GDP per capita " as reported i n the PWT is intended to represent the ability to purchase goods and services by a representative agent in the economy. The same is true of benchmark comparisons as published by the United Nations, Eurostat, or OECD. But this expenditure-side interpretation of real GDP is quite different from the uses to which benchmark ICP and PWT data are frequently applied, such as in growth regressions, where " real GDP " is intended to reflect the production side of the economy. In this paper the authors propose a new approach to international comparisons of real GDP measured from the output side. They modify the traditional Gary-Khamis system, which measures real GDP from the expenditure side using real domestic expenditure, to include differences in the terms of trade between countries. The analysis shows that this system has a strictly positive solution under mild assumptions. On the basis of a set of domestic final output, import, and export prices and values for 151 countries in 1996, differences between real GDP measured from the expenditure and output side can be substantial, especially for small open economies. |
| Keywords: | Economic Theory & Research,Markets and Market Access,Free Trade,Access to Markets,Trade Policy |
| Date: | 2007–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4166&r=int |
| By: | Prabir De (Research and Information System for Developing Countries) |
| Abstract: | Findings of this paper have important policy implications for Asian countries seeking to expand trade. Addressing rising auxiliary shipping charges as well as the overall rise in shipping costs may require serious consideration by regulators and policymakers that wish to further promote trade in Asia. In addition, if improvements in the quality of infrastructure in LDCs continue to lag behind those in more developed countries, their share in world trade is likely to decline. |
| Keywords: | Trade Facilitation, Trade Cost, Trade Liberalisation |
| JEL: | F1 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:esc:wpaper:2707&r=int |
| By: | Mia Mikic (United Nations Economic and Social Commission for Asia and the Pacific) |
| Abstract: | In many developing countries, the health-care sector is under-developed, lacking basic infrastructure and human capital, and attracting little attention from investors and policymakers. While encouraging globalization and trade may aggravate those problems and create additional costs in some circumstances, trade liberalization and deeper integration into the global economy could also provide opportunities and resources to address those problems more effectively. This paper contributes to the debate by reporting on the status of liberalization achieved in the health services sector by members of ESCAP through their regional and multilateral trade liberalization commitments. |
| Keywords: | Health services trade, GATS, TRIPS, Preferential Trade Aggreeemetns, Modes of Services Delivery, ASEAN |
| JEL: | F13 F15 I19 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:esc:wpaper:3007&r=int |
| By: | Kox, Henk L.M.; Nordås, Hildegunn Kyvik |
| Abstract: | This paper argues that regulatory measures affect the fixed cost of entering a market as well as the variable costs of servicing that market. Moreover, differences in regulation among countries often imply that firms have to incur entry costs in every new market. Indicators of regulatory intensity and heterogeneity are introduced in a gravity model and their impact on market entry and subsequent trade flows estimated for total services, business services and financial services. It is found that regulatory heterogeneity has a relatively large negative impact on both market entry and subsequent trade flows. Further, regulatory barriers have a negative effect on the local services sectors’ export performance. Finally it is found that regulations that aims at correcting market failure can have a positive impact on trade. It is concluded that services trade liberalization and regulatory reforms are complementary in creating competitive services markets. |
| Keywords: | Trade in services; regulation; GATS; fixed trade costs |
| JEL: | F12 L8 F13 F14 |
| Date: | 2007–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:2116&r=int |
| By: | Janaka Wijayasiri (Institute of Policy Studies) |
| Abstract: | The GSP scheme was initiated by UNCTAD in 1968 with the objective of enabling developing country exports to enter developed country markets under preferential rates. Sri Lanka has been a beneficiary under the GSP scheme over the last three decades. However, meeting the scheme’s objective of export expansion seems to have fallen short and Sri Lanka has not been able to export effectively under the EU and US GSP schemes, which are the most important non-reciprocal preference arrangements providing access to Sri Lanka’s main export markets. |
| Keywords: | Generalized System of Preferences (GSP), Rules of Origin(RoO),EU, US, Sri Lanka |
| JEL: | F1 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:esc:wpaper:2907&r=int |
| By: | Mirza, Daniel; Verdier, Thierry |
| Abstract: | What is the impact of terrorism on trade through higher security at the borders? We set up a theory which shows that the impact goes not only from terrorism to trade; higher trade with a partner might, in turn, increase the probability of terrorism acts and make security measures more costly for total welfare. In order to identify the true impact of terrorism, our theory allows then for a strategy to condition out the latter mechanism. We show in particular how past incidents perpetrated in third countries (anywhere in the world except the origin or targeted country) constitute good exogenous factors for current security measures at the borders. Our tests suggest that terrorist incidents have a small effect on US imports on average, but a much higher effect for those origin countries at the top of the distribution of incidents. In addition, the level of the impact is up to three times higher when the acts result in a relatively high number of victims, the products are sensitive to shipping time, and the size of the partner is small. The paper further shows how terrorism affects the number of business visas delivered by the Unites States, thereby impacting significantly US imports in differentiated products. These results suggest that security to prevent terrorism does matter for trade. |
| Keywords: | security; terrorism; trade |
| JEL: | F12 F13 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6173&r=int |
| By: | Joachim Wagner |
| Abstract: | Using unique recently released nationally representative high-quality data at the plant level, this paper presents the first comprehensive evidence on the relationship between productivity and size of the export market for Germany, a leading actor on the world market for manufactured goods. It documents that firms that export to countries inside the euro-zone are more productive than firms that sell their products in Germany only, but less productive than firms that export to countries outside the euro-zone, too. This is in line with the hypothesis that export markets outside the euro-zone have higher entry costs that can only by paid by more productive firms. |
| Keywords: | Exports, productivity, micro data, Germany |
| JEL: | D21 F14 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2007-13&r=int |
| By: | Joachim Wagner |
| Abstract: | Using unique recently released nationally representative high-quality longitudinal data at the plant level, this paper presents the first comprehensive evidence on the relationship between exports and productivity for Germany, a leading actor on the world market for manufactured goods. It applies and extends the now standard approach from the international literature to document that the positive productivity differential of exporters compared to non-exporters is statistically significant, and substantial, even when observed firm characteristics and unobserved firm specific effects are controlled for. For West German plants (but not for East German plants) some empirical evidence for self-selection of more productive firms into export markets is found. There is no evidence for the hypothesis that plants which start to export perform better in the three years after the start than their counterparts which do not start to sell their products on the world market. Results for West Germany support the hypothesis that the productivity differential between exporters and non-exporters is at least in part the result of a market driven selection process in which those export starters that have low productivity at starting time fail as a successful exporter in the years after the start, and only those that were more productive at starting time continue to export |
| Keywords: | Exports, productivity, micro data, Germany |
| JEL: | F14 D21 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2007-15&r=int |
| By: | Sachin Chaturvedi (Research and Information System for Developing Countries) |
| Abstract: | In this paper authors have made an effort to take a stock of various FTAs in South Asia from the point of view of incorporation of TF measures in the text of FTAs. Authors also look into the individual initiatives being made by the South Asian countries for advancement of trade facilitation especially in context of Articles V, VIII and X. |
| Keywords: | FTA, South Asia, Articles V, VIII, and X, Trade Facilitation |
| JEL: | F1 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:esc:wpaper:2807&r=int |
| By: | Margaret K. Kyle |
| Abstract: | This paper examines how pharmaceutical firms have responded to changes in intellectual property rights and trade barriers that legalized "parallel imports" within the European Union. The threat of arbitrage by parallel traders reduces the ability of firms to price discriminate across countries. Due to regulations on price and antitrust law on rationing supply, pharmaceutical firms may rely on non-price responses. Such responses include differentiation of products across countries and selective "culling" of product lines to reduce arbitrage opportunities, as well as raising arbitrageurs' costs through choice of packaging. Using a dataset of drug prices and sales from 1993-2004 covering 30 countries, I find evidence that the behavior of pharmaceutical firms in the EU with respect to their product portfolios is consistent with attempts to reduce parallel trade. This may at least partially explain why parallel trade has not yet resulted in significant price convergence across EU countries. Accounting for non-price strategic responses may therefore be important in assessing the welfare effects of parallel imports. |
| JEL: | D21 L1 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12968&r=int |
| By: | Joachim Wagner |
| Abstract: | Using unique new data and a recently introduced non-linear decomposition technique this paper shows that the huge difference in the propensity to export between West and East German plants is to a large part due to differences in firm size and human capital intensity. |
| Keywords: | Exports, micro data, West Germany, East Germany |
| JEL: | F14 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2007-14&r=int |
| By: | Léonce Ndikumana (University of Massachusetts, Amherst, and UNECA, Addis Ababa); Mina Baliamoune-Lutz (University of North Florida and IED/Boston University) |
| Abstract: | In this paper, we explore the argument that one of the causes for the limited growth effects of trade openness in Africa may be the weakness of institutions. We also control for several major factors and, in particular, for export diversification, using a newly developed dataset on Africa. Results from Arellano-Bond GMM estimations on panel data from African countries show that institutions play an important role in enhancing the growth effects of trade. Moreover, we find that the joint effect of institutions and trade has a U-shape, suggesting that as openness to trade reaches high levels, institutions play a critical role in harnessing the trade-led engine of growth. The results from this paper are informative about the missing link between trade liberalization and growth in the case of African countries. JEL Categories: |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:ums:papers:2007-05&r=int |
| By: | Mirza, Daniel; Verdier, Thierry |
| Abstract: | In this paper, we offer a general analytical framework to illustrate the complex two-way interactions between trade and transnational terrorism. We then survey the recent economic literature in light of this framework by pointing to the importance in empirical studies a) to control appropriately for these interactions, b) to distinguish between 'source' countries and 'target' countries of terrorism and c) to take into account the intertemporal persistence of terrorism between specific pairs of countries. |
| Keywords: | globalization; security; terrorism |
| JEL: | F12 F13 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6174&r=int |
| By: | M. Scott Taylor |
| Abstract: | In the 16th century, North America contained 25-30 million buffalo; by the late 19th century less than 100 remained. While removing the buffalo east of the Mississippi took settlers over 100 years, the remaining 10 to 15 million buffalo on the Great Plains were killed in a punctuated slaughter in a little more than 10 years. I employ theory, data from international trade statistics, and first person accounts to argue that the slaughter on the plains was initiated by a foreign-made innovation and fueled by a foreign demand for industrial leather. Ironically, the ultimate cause of this sad chapter in American environmental history was of European, and not American, origin. |
| JEL: | F1 Q2 Q5 Q56 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12969&r=int |
| By: | Nguyen, Anh; Jones, Nicola |
| Abstract: | Following extensive economic and market reforms and more than a decade of negotiations, Vietnam became the latest country to accede to the World Trade Organization in November 2006. While it is expected that greater integration into the world economy will boost Vietnam’s economic growth and contribute to the country’s ongoing transition towards a market economy, there are concerns about potentially negative impacts on vulnerable sectors of the population, including remote rural populations, women and children. This paper examines the possible impacts of Vietnam’s trade liberalisation on children in poor communities. It focuses on three key aspects of child well-being – child work (domestic and extra-household), educational attainment and health status – drawing on data from the first wave of the Young Lives Vietnam longitudinal survey on childhood poverty. Our main findings point to significant differences based on ethnicity, household poverty status and vulnerability to declining living standards, parental (especially maternal) education levels, children’s involvement in work activities, and access to public services. |
| Keywords: | Childwelfare; Vietnam; WTO; Education; Child Labour; Young Lives |
| JEL: | F15 I31 F16 I20 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:1385&r=int |
| By: | Cadot, Olivier; de Melo, Jaime |
| Abstract: | With preferential trading Agreements (PTAs) on the rise worldwide with multiple memberships, rules of origin-- which are necessary to prevent trade deflection --are attracting increasing attention. At the same time, preference erosion for GSP recipients is threatening the viability of the further multilateral negotiations. Drawing on different approaches, we show that the current system of rules of origin (RoO) in place for EU and US preferential trade agreements (including the GSP) which are representative of RoO practiced by OECD countries should be drastically simplified if developed countries really want to help developing countries integrate into the World Trading System. Besides diverting resources for administration, RoO regimes of the EU and US carry significant compliance costs. More fundamentally, it is becoming increasingly clear that RoO have often been designed to force the Southern partner to buy inefficient intermediate products from the Northern partner (the so-called ‘double transformation rule’ in textiles & apparel (T&A) is such an example) to ‘pay for’ preferential access for the final product. Evidence is also indicating that a significant fraction of the remaining rents (after accounting for increasing costs to comply with RoO requirements) associated with market access are largely captured by the Northern partner. Finally, we report evidence that the restrictiveness of RoO is beyond levels that would be justified to prevent trade deflection implying capture by special interest groups. The paper concludes by outlining alternative paths to reforms. |
| Keywords: | market access; AFTA; ASEAN; NAFTA; PANEURO; preferential trade agreements; Rules of Origin |
| JEL: | F13 F15 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6172&r=int |
| By: | Mary Amiti; John Romalis |
| Abstract: | This paper assesses the effects of reducing tariffs under the Doha Round on market access for developing countries. It shows that for many developing countries, actual preferential access is less generous than it appears because of low product coverage or complex rules of origin. Thus lowering tariffs under the multilateral system is likely to lead to a net increase in market access for many developing countries, with gains in market access offsetting losses from preference erosion. Furthermore, comparing various tariff-cutting proposals, the research shows that the largest gains in market access are generated by higher tariff cuts in agriculture. |
| JEL: | F13 F14 F17 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12971&r=int |