Environmental impact of customs union agreement with EU on Turkey's trade in manufacturing industry

In this study, we analyse Turkey's manufacturing industry trade by estimating sectoral import and export demand equations for 1980–2000. The study aims to understand whether the trade in the manufacturing industry complies with pollution haven hypothesis, and whether the free trade environment provided by the customs union (CU) agreement altered the trade pattern of the clean and dirty industries. Results of our econometric models have shown that while CU positively affects the import demand, it does not have any significant impact on the export demand of Turkish manufacturing industry. In terms of the environmental impact, distinction between clean and dirty industries turns out to be significant for both import and export demand. In general, our findings suggest that both clean and dirty industries’ import demand increased during the study period. In terms of export demand, clean industries’ export demand declines whereas dirty industries’ export demand increases compared to the total demand.     

Duration dependent unemployment benefits in trade union theory

The basic trade union model is generalized to allow for an unemployment benefit system consisting of two benefit levels, one for short-term and one for long-term unemployed, and a rule determining whether an unemployed is short- or long-term. Under relatively mild conditions we show that benefit systems with no or positive duration dependence are dominated by a system with negative duration dependence in the sense that all union members achieve higher utility, unemployment is lower, and benefit expenditures are smaller.     

A survival analysis approach to the duration of union membership in Italy

Thanks to direct access to union databases, this article applies survival analysis to a sample of 47?637 Italian workers trying to explain the determinants of the duration of union membership. The results show that union membership duration is a positive, though declining, function of age. Furthermore, women, flexible workers, foreign ones and those working in cities tend to show less attachment to union membership than other workers. The estimated median duration is about 6 years. Positive hazard duration dependence is also found. Unobserved heterogeneity is detected but it does not significantly affect model estimates.     

The effect of a currency union on trade: Lessons from the Irish experience

This paper studies the introduction of an exchange rate between Ireland and the UK in 1979 to shed light on the effects of a common currency on the composition of international trade. No evidence is found from time series or panel regressions that the change of exchange rate regime had a significant effect on Anglo-Irish trade. This finding is consistent with previous studies of currency unions between larger, developed countries but conflicts with findings based on more heterogeneous country groupings. The reasons for this discrepancy are discussed.     

The trade impact of European Union agricultural preferences

We assess the impact on agricultural trade of European Union (EU) trade policies, using a gravity model based on disaggregated trade flows from 161 developing countries (DCs) to 15 EU member countries. We use a sample selection framework to account for potential selection bias of positive trade flows and provide an explicit measure for relative preference margins. From a policy perspective, our results debunk some of the most widespread criticisms of preferential policies: EU preferences matter and have a positive impact on DCs agricultural exports at both the extensive and intensive margins, although with significant differences across sectors.     

建立东亚自由贸易区前途坎坷

20世纪80年代末,随着冷战的结束,东亚地区国家间的政治、经济和对外关系出现了重大调整,经济贸易合作加强,利益相互依赖加深。世界经济全球化趋势加速发展,地区经济集团组织不断涌现,特别是北美自由贸易区、美洲自由贸易区、欧洲联盟的建立,更加激发了东亚国家建立某种形式的经济贸易合作组织的热情。从20世纪90年代开始,东亚国家接连提出各种建立地区经济合作组织的建议。东亚各国政府首脑一个接一个地提出地区经济合作的建议,宣告了创建东亚地区经济合作组织的时代已经来临。当今国际经济合作和地区经济一体化理论认为,国家和地…     

The impact of trade costs on exports: An empirical modeling

Studies, which have discussed some of the important issues concerning the measurement of trade costs, have conceded that the literature is still in the early stages of understanding and measuring what the real costs are. It is in this context, decomposing trade costs into ‘natural’ costs, ‘behind the border’ costs, ‘explicit beyond the border’ costs, and ‘implicit beyond the border’ costs, this paper suggests a method to measure the impacts of these components on changes in exports between countries in the absence of complete information on all the components of trade costs in home and partner countries. Empirical measurement has been demonstrated using 1999 and 2004 trade data from Pakistan. The results show that Pakistan's export growth between 1999 and 2004 came mainly from the reduction in both ‘explicit and implicit beyond the border’ trade costs in partner countries.     

Foreign trade and its impact on employment: The Mexican case

This paper discusses the relationship between foreign trade and employment in a small open economy, and carries out some empirical work using Mexican data. It is argued that employment multipliers are not stable if intermediate inputs are imported. Actual employment multipliers will be given by the relationship between effective demand and installed capacity in each sector, and will depend strongly on whether quotas or tariffs are in operation. It is also found that Mexican exports are capital intensive relative to its imports.     

The impact of West European trade strategies on exports to Eastern Europe

This paper examines the extent to which West European countries have utilized diplomacy and reductions in trade barriers to improve their export performance in East European markets during the 1960's. Equal-price export shares of 7 West European countries are estimated by means of an econometric model, and their behavior over time and among importing regions is related to the commercial and foreign policies of the exporters. Our results demonstrate that East European import decisions have been significantly influenced both by changes in western commercial policies and by diplomatic initiatives such as DeGaulle's effort at détente with the Soviet Union. Our results also indicate that elasticities of substitution in East-West trade are significantly lower than those in trade among western countries.     

The impact of Africa‐China's diplomatic visits on bilateral trade

This article documents that African leaders’ state visits to China could stimulate China's exports to Africa in capital intensive manufacturing goods. We further find that state visits significantly increase official aid and exports by state‐owned enterprises to African countries which contribute to the trade growth after state visits.     

Long-term impact of trade liberalization on human capital formation

While a growing line of research has assessed the effect of trade liberalization on human capital formation, most of these studies focus on its short-term effect on individual’s school attendance. Much less is known about its long-run effect, as well as the impact on other aspects of human capital formation such as labor market and noncognitive outcomes. This paper studies the impact of trade liberalization on individuals’ long-term human capital accumulation, including school attendance, cognitive abilities, labor market performance, and noncognitive outcomes. By constructing prefecture-year-level tariff barriers, our identification strategy exploits variations in different cohorts’ exposure to a trade shock at age 16 for individuals within the same prefecture. Empirical results suggest that trade liberalization leads to decreased completed years of schooling, cognitive abilities, wage, and noncognitive outcomes. We provide suggestive evidence that this observed pattern is explained by the expansion of job opportunities in relatively low-skilled and labor-intensive sectors.     

The impact of the Soviet trade shock on central and East European economies

The paper examines the significance of what is called the Soviet trade shock on central and East European economies. The analysis involves two steps: first, the terms-of-trade effect of replacing the CMEA trading rules by market rules is estimated, and second, the impact of the loss of export markets in the former Soviet Union is assessed. The results of estimating the terms-of-trade effect for Hungary and Poland show that the income losses in 1990–1991 have not been as substantial as commonly believed (3.5 percent of GDP and 1.0 percent of GDP, respectively). The decomposition of the fall of total Soviet imports in 1991 into three categories, reflecting the impact of domestic recession, reduction of trade with ex-CMEA, and diversion of imports from ex-CMEA to western countries allowed us to estimate the CMEA-induced part of the trade collapse at 36 to 49 percent of the total fall of exports to the Soviet Union by the CEECs (except Romania), with the impact of domestic recession being in all cases stronger than the CMEA dissolution effect. An attempt has also been made to estimate the impact of the Soviet trade shock on GDP levels in CEECs. The results obtained indicate that the collapse of exports to the Soviet Union in 1991 may have been responsible for about one third of the officially reported GDP fall in Czechoslovakia and Poland, and for more than half of the GDP fall in Bulgaria and Hungary, but the impact of the CMEA-induced export fall was much smaller. The impact of the Soviet trade shock on Romania was negligible. The results obtained suggest a smaller impact of the Soviet trade shock on Hungary and Poland, as compared with some other studies. The conclusions should, however, be treated with caution, because of many untested assumptions underlying the analysis.I would like to acknowledge helpful comments received on earlier drafts of the paper by Daniel Gross, Dieter Hesse, Gabor Oblath, and Mica Panic. The views expressed in the paper are, however, my own responsibility.     

The impact of carbon cap and trade regulation on congested electricity market equilibrium

Greenhouse gas regulation aimed at limiting the carbon emissions from the electric power industry will affect system operations and market outcomes. The impact and the efficacy of the regulatory policy depend on interactions of demand elasticity, transmission network, market structure, and strategic behavior of generators. This paper develops an equilibrium model of an oligopoly electricity market in conjunction with a cap-and-trade policy to study such interactions. We study their potential impacts on market and environmental outcomes which are demonstrated through a small network test case and a reduced WECC 225-bus model with a detailed representation of the California market. The results show that market structure and congestion can have a significant impact on the market performance and the environmental outcomes of the regulation while the interactions of such factors can lead to unintended consequences.     

The impact of domestic regulations on international trade in services: Evidence from firm-level data

In order to promote international trade in services, most bilateral and multilateral trade agreements aim at eliminating the discriminatory barriers. However, domestic regulations, which apply to all firms alike and do not intend to exclude foreign sellers, are often seen as serious obstacles to cross-border trade in services. This paper proposes an assessment of the impact of these regulations on international trade of professional services. Our empirical analysis combines OECD measures of domestic regulation and detailed French data on firm-level bilateral export of professional services. Results show a robust and a sizeable negative impact of domestic regulations on both the decision to export and the values exported by each firm. This impact does not vary with firms’ productivity, and remains significant when we focus on the European Union market, where French exporters do not face discriminatory barriers. We conduct a quantification exercise based on our estimates and find an average ad-valorem tariff equivalent of domestic regulations of 60% in 2007. The ad-valorem tariff equivalent ranges from 26% to 88%, depending on the country.     

The impact of trade on the relative wages and employment of low skill workers in France

The impact of international trade on labour markets in developed countries will be different according to the degree of competition in product markets, the flexibility of the labour market and the skill intensity of production. An econometric analysis of the impact of trade in France has been undertaken using sectoral data for the period 1985–p1992. It is found that lower relative import prices reduce the relative employment of low skill workers in the first half the period and reduce their relative wages in the second half. In both cases the effect is more pronounced in sectors where the skill intensity of production is initially low.     

The impact of trade openness on technical efficiency in the agricultural sector of the European Union

The aim of this study is to analyse the impact of trade openness on technical efficiency of the European Union’s (EU) agricultural sector. There are no systematic theories linking trade policy to technical efficiency; hence, the relation between trade liberalization and technical efficiency is fundamentally ambiguous. Stochastic frontier analysis is used to model the relationship between EU’s production resources and agricultural output, as well as the importance of trade openness on technical efficiency of a country. The data for 16 of the 28 EU members were available for the period 1980–2007 including land, capital, fertilizer, labour, agricultural GDP, foreign direct investments (FDI), exports and import data. Results indicate that trade openness has an immediate, negative impact on efficiency in the EU agricultural sector. Over time, however, trade openness does increase efficiency. The FDI outflows increase efficiency. This suggests that an initial reduction in capital supply forces EU nations to utilize other factor inputs more efficiently. However, there is the unexamined potential that over time the depletion of capital results in a decrease in efficiency. Finally, formerly communist member-countries of the EU are found to have the lowest technical efficiency scores whereas Southern European nations have the highest efficiency.