Labour-market effects of intra-industry trade: Evidence for the United Kingdom

Labor-Market Effects of Intra-Industry Trade: Evidence for the United Kingdom. — According to the “smooth adjustment hypothesis”, the labor-market adjustment costs entailed by trade liberalization are lower if trade expansion is intra-industry rather than inter-industry in nature. In this paper, we study the link between trade and labor market changes in UK manufacturing industries during the 1980s. We use industry-level measures of unemployment duration and wage variability as proxies for adjustment costs, and we relate them to various measures of intra-industry trade. Our evidence offers some support for the smooth adjustment hypothesis.     

The link between immigration and trade: Evidence from the United Kingdom

Immigration and Trade: Evidence from the United Kingdom. — This paper investigates the link between immigration and trade using recent UK data. Immigration from non-Commonwealth countries is shown to have a significant export-enhancing effect. By contrast, immigration from Commonwealth countries is found to have no substantial impact on exports. We conjecture that this could be because immigrants from the UK’s former colonies do not bring with them any new information that can help substantially reduce the transaction cost of trade between their home countries and the host nation. The study also reveals a pro-imports effect of immigration from the non-Commonwealth countries, whereas immigration from the Commonwealth appears to be reducing imports, perhaps reflecting trade-substituting activities by immigrants.     

The composition of the human capital stock and its relation to international trade: Evidence from the US and Britain

The Composition of the Human Capital Stock and Its Relation to International Trade: Evidence from the US and Britain. — This paper examines the factor intensity of US and UK trade using standard factor content techniques. In particular, it considers the role of labour skills in international trade. The principal focus is to demonstrate that specialisation according to skills has two dimensions-according to the general level of human capital and according to different types of skill at the same level of education and training. This analysis is conducted for different trading partners for each country. The paper also offers some methodological evidence on the effects on factor content analysis of the (dis)aggregation of factors and on the role of internationally varying production techniques.     

Do private capital markets insure regional risk? Evidence from the United States and Europe

A striking feature of international economic relations is the limited extent of intertemporal trade and risk-sharing among nations. This paper uses data on consumption, income, and production from regions of the United States to address the question of whether the limited participation of national economies in international capital markets is a fundamental aspect of economic relations among large geographic regions, or whether it is specifically an artifact of international economic relations. We conclude that capital flows among the regions of the United States are significantly larger than those across countries. However, such private markets still provide a relatively limited degree of insurance against regional fluctuations.     

Foreign trade,domestic production and relative prices — a simulation model for the United States and Japan

Zusammenfassung Au\enhandel, Inlandsproduktion und relative Preise — Ein Simulationsmodell für die Vereinigten Staaten und Japan. — Der Zweck dieser Abhandlung ist es, die Wirkungen der Au\enhandelsstruktur und der Au\enhandelssalden (sowohl insgesamt als auch bilateral) auf Zusammensetzung und Niveau der Inlandsproduktion sowie die relativen Preise in den Vereinigten Staaten und Japan im Jahr 1960 zu analysieren. Die Studie gründet sich auf ein statisches allgemeines Gleichgewichtsmodell vom Leontief-Typ mit 20 Sektoren und zwei prim?ren Inputs. Der Verfasser versucht folgende zwei Fragen zu beantworten: 1. Wie beeinflu\te der gesamte und der bilaterale Au\enhandel jedes der beiden L?nder die Zusammensetzung ihrer Inlandsproduktion und die Struktur der relativen Preise ? 2. Wie beeinflu\ten die gesamten und die bilateralen Handelsbilanzen der beiden L?nder ihr Konsumniveau und den Einsatz ihrer prim?ren Produktionsfaktoren (bzw. ihre Ersparnis) ?

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Résumé Commerce extérieur, production intérieure et prix relatifs — Un modèle de simulation pour les Etats-Unis et le Japon. — Le but de cet article est d’analyser les effets que la structure et le solde du commerce extérieur (total et bilatéral) exercent aussi bien sur la composition et le niveau de la production intérieure que sur les prix relatifs des Etats-Unis et du Japon dans l’année 1960. Cette étude est basée sur un modèle de l’équilibre général et statique du type Leontief à vingt secteurs et deux inputs primaires. L’auteur essaye à répondre à deux questions: 1ℴ Comment le commerce extérieur (total et bilatéral) de chaque pays a-t-il influencé la composition de la production intérieure et la structure des prix relatifs ? 2ℴ Comment le solde du commerce extérieur (total et bilatéral) de chaque pays a-t-il influencé le niveau de la consommation et l’utilisation des inputs primaires (ou l’épargne) ?

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Resumen Comercio exterior, producción interna y precios relativos — Un modelo de simulación para los Estados Unidos de América y Japón. — El propósito de este modelo es analizar los efectos de la estructura y los Saldos del comercio exterior (total y bilateral) sobre la compositión y el nivel de la producción interna como sobre los precios relativos en los Estados Unidos y Japón para 1960. El estudio se basa sobre un modelo de equilibrio general estático del tipo Leontief con veinte sectores y dos inputs primarios. El autor trata de contestar las siguientes preguntas: (1) ? de qué manera influyeron el comercio total y bilateral de estos dos países sobre la composición de la producción interna y la estructura de los precios relativos ? (2) ? de qué manera afectaron los saldos totales y bilaterales de comercio exterior de los dos países sus niveles de consumo agregado y el uso de factores primarios (o ahorro) ?

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Riassunto Commercio estero, produzione interna e prezzi relativi — Un modello di simulazione per gli Stati Uniti ed il Giappone. — Lo scopo di questo lavoro è di analizzare gli effetti della struttura del commercio estero e dei saldi del commercio estero (tanto complessivamente quanto bilateralmente) su composizione e livello della produzione interna come anche i prezzi relativi negli Stati Uniti e Giappone nell’anno 1960. Lo studio si fonda su un modello generale di equilibrio statico del tipo Leontief con venti settori e venti input primari. L’autore cerca di rispondere alle due domande seguenti: 1. Come il commercio estero totale e bilaterale di ognuno dei due Paesi influenzó la composizione della loro produzione interna e la struttura dei relativi prezzi ? 2. Come le bilance commerciali totali e bilaterali dei due Paesi influenzarono il loro livello di consumo e l’impiego dei loro fattori primari di produzione (risp. i loro risparmi) ?

     

International trade and worker flows: empirical evidence for Germany

Using a linked employer–employee data set for Germany, this paper studies how worker flows are related to establishments’ international trade involvement. Unconditional figures show that trading establishments have lower worker turnover rates than non-traders, suggesting a higher degree of employment stability. Conditional on an extensive set of control variables, exporting is further associated with a higher net job flow rate, which is almost entirely due to a lower separation rate (particularly for high-skilled workers and transitions into non-employment). In contrast, both an increase and a decrease in import intensity are (weakly) associated with a lower accession rate. These results are predominantly driven by smaller establishments, and they partly lose statistical significance once unobservable establishment characteristics are taken into account.     

Consumption,Credit, and Macroeconomic Policies: Theory and Evidence from the United States

Abstract

The paper examines determinants of private consumption in the USA. The empirical model includes disposable income, the University of Michigan consumer sentiment index, the interest rate, and the real effective exchange rate. Anticipated movements in these determinants are likely to affect planned consumption, while unanticipated changes determine cyclical consumption. Fluctuations in private consumption are mostly cyclical with respect to changes in disposable income and the consumers’ sentiment index. In contrast, an increase in the interest rate decreases both planned and cyclical consumption. Fiscal policy has a direct negative effect on cyclical consumption, which is not dependent on the interest rate. Monetary growth, in contrast, increases liquidity to finance both planned and cyclical private consumption.     

Trade deficits and trade conflict: The United States and Japan

The US trade relationship with Japan was characterised by periods of intense conflict over 1969−95. The paper identifies five such periods, beginning with two bitter conflicts in 1971 and ending with an equally difficult conflict over autos in 1994−95. It presents econometric evidence suggesting rising Japanese penetration of the American market and growth in the bilateral merchandise trade deficit with Japan were important causes of these crises. Over 1996–2016, US-Japan relations were handled in a much less confrontational manner, as import penetration declined. The difficulties Japan’s economy faced; heightened security concerns in Northeast Asia; a broader US shift away from unilateral measures; greater acceptance of the trade deficit; and perceptions that Japan was moving to open its economy were also important in lessening tensions in the bilateral relationship. Strong concerns with the US trade deficit re-emerged under the Trump Administration, but the two economies were, during this period, able to address trade differences without a major confrontation.     

International Trade and R&D Investment: Evidence from Chinese Manufacturing Firms

A current concern for China's long‐term growth prospect is whether China can become an innovative economy and achieve industrial upgrading to compensate for the gradually declining competitiveness resulting from low‐cost labor. The present study examines this issue by exploring how trade participation impacts on the R&D investment of manufacturing firms through various channels. Merging China's Annual Manufacturing Survey Dataset and the Chinese Customs Dataset allows us to study such a relationship at the individual firm level. The empirical results suggest that channels such as geographical diversification of export markets, share of imports from high‐income countries, average unit value of imports, number of intermediate goods and capital goods imports, and the trade regime are significant factors that influence firm‐level R&D investment. The study discusses the policy implications of the empirical findings in relation to industrial and trade policies that may be potentially beneficial for China's transition towards an innovative economy.     

Trade and welfare effects of a potential free trade agreement between Japan and the United States

Review of World Economics - This paper addresses the trade and welfare implications of a bilateral trade agreement between the U.S. and Japan. In 2019, the two countries signed a “stage...     

Firm-level human capital and innovation: Evidence from China

This paper examines the role of human capital in firms' innovation. Based on a World Bank survey of manufacturing firms in China, we use two firm-level datasets: one from large metropolitan cities, and one from mid-sized cities. Patents are used as an indicator of innovation. The human capital indicators we use include the number of highly educated workers, the general manager's education and tenure, and the management team's education and age. We use the Negative Binomial and Instrumental Variables estimators to estimate patent production function models that are augmented by our human capital variables. We also use the zero-inflated Negative Binomial model to examine the likelihood of innovation. We find that the human capital indicators play an important role in influencing patenting, and that some of the human capital variables appear to have a greater impact on patenting in mid-sized cities. Our human capital estimates are obtained after controlling for firms' R&D, size, market share, age, and foreign ownership, as well as fixed effects to control for industry-specific characteristics, and firms' location and geography.     

Differential Tariffs and Income Inequality in the United States: Some Evidence from the States

Open Economies Review - This paper explores the macroeconomic and distributional consequences of consumption tariffs and materials tariffs. It highlights the contrasting effects of consumption and...     

Industry-specific human capital and the wage profile: Evidence from Taiwan

Using data from Taiwan's Manpower Utilization Survey (1979–2000), this paper finds evidence that supports the industry-specific human capital effect on wage tenure profiles. Work experience is used as an indirect measure for testing industry-specific human capital by comparing the effect between stayers and movers. Other things being equal and holding firm tenure constant, movers actually incur a wage loss measured by the wage premium of the work experience. However, a greater than average firm tenure effect, especially for movers in the voluntary group, reflects an underlying job-related matching process. We also find that the effect of work experience declines with education, while the effect of industry-specific human capital increases with education. JEL no. J24, J31, J41, J62.     

Rational Partisan Theory: Empirical Evidence for the United States

This paper presents two tests of the rational partisan theory (RPT) of business cycles. First, I develop and test an RPT model in which wage contracts are staggered and overlapping. Bureau of Labor Statistics (BLS) data on the density and duration of wage contracts and estimates of the incumbent party's election-win probability are employed to calibrate partisan intervention variables entered in output growth regressions. Next, I perform a more “flexible” test of the RPT by comparing partisan output growth differences after elections in which the outcome was relatively surprising with partisan output growth differences after elections in which the outcome was widely anticipated. The two approaches produce the same conclusion: The RPT is not supported by the data.     

Measuring trade creation effects of free trade agreements: Evidence from wine trade in East Asia

East Asia has experienced an unprecedented expansion in its wine market over the past two decades. This paper examines the extent to which import tariff reductions through bilateral free trade agreements (FTAs) have contributed to an increase in wine imports to Japan, China, and South Korea. Our empirical method involves estimating an augmented version of the gravity equation by the Poisson pseudo-maximum likelihood (PPML) technique. Analyzing a panel dataset for 1990–2016 covering 27 exporters, we find that overall a 1 percentage point reduction in tariff among FTA member countries is associated with an increase in the wine import volumes by 0.042%, which is seven times higher than a similar reduction in tariff on an MFN basis. The strongest trade creation effects are founded for bottle wine. The results are robust to various specifications.     

The potential for mutually beneficial trade negotiations between the United States and advanced LDCs

Zusammenfassung Das Potential für beidseitig vorteilhafte Zollverhandlungen zwischen den Vereinigten Staaten und fortgeschrittenen Entwicklungsl?ndern. — Dieser Aufsatz versucht, das Potential für beidseitig vorteilhafte Zollsenkungen zwischen den Vereinigten Staaten und einer Auswahl ihrer gr?\ten Handelspartner unter den Entwicklungsl?ndern zu bestimmen. Ein partielles DreiL?nder-Gleichgewichtsmodell wird benutzt, um die direkten und indirekten Wirkungen auf den Au\enhandel abzusch?tzen, wenn die Zolls?tze bei den Gütern gesenkt Єrden, für die jedes Land Hauptlieferant ist. Diese Sch?tzungen best?tigen die bedeutenden potentiellen Vorteile von Zollsenkungen; jedoch zeigt eine eingehende Produktanalyse, da\ die Mehrheit der in Betracht kommenden Güter von amerikanischen Politikern bereits als ?import-sensibel? angesehen wird.

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Résumé Le potentiel des négociations mutuellement béneficiares sur le commerce extérieur entre les Etats Unis et les PVD avancés. — Ce papier essaie de déterminer le potentiel des réductions tarifaires mutuellement béneficiaires entre les Etats Unis et un échantillon des ses partenaires commerciaux les plus grands parmi les PVD. Nous appliquons un modèle de trois-pays et d’équilibre partiel pour estimer les effets commerciaux directs et ?spill-over? des réductions tarifaires pour des biens offerts principalement par chaque pays. Ces estimations documentent les bénéfices potentiels significatives des réductions tarifaires cependant les analyses détaillées de bien révèlent une majorité des produits négociables déjà considérés comme sensitifs aux importations par les politiciens des Etats Unis.

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Resumen El potencial para negociaciones comerciales mutuamente beneficiosas entre los EEUU y los países en desarrollo más avanzados. — En este articulo se trata de determinar el potencial de reducciones tarifarias mutuamente beneficiosas entre los EEUU y una muestra de sus socios comerciales más importantes. Un modelo de equilibrio parcial de tres países es usado para estimar los efectos comerciales directes y de ?spill-over? de reducciones tarifarias sobre items en los cuales cada país es el principal oferente. Estas estimaciones documentan los beneficios potenciales significativos de las reducciones tarifarias; sin embargo, un análisis detallado por productos revela que la mayoría de los productos negociables ya han sido considerados como sensibles a la importación por los formuladores de políticas de los EEUU.

     

International trade and agricultural production: Evidence from the Southern African Development Community sub-region

Southern African Development Community (SADC) countries have undertaken substantial reforms in market liberalisation policies and regional integration initiatives. Theory suggests that trade can affect output through the exploitation of comparative advantage, increasing return to scale, liberalisation policies and technology. This work investigates the impact of agricultural exports to, machinery and chemical imports from and tariffs on agricultural products by total partners to the Southern African Customs' Union, SADC, sub-Saharan Africa and the rest of the world on agricultural production. Following Hausman tests, three panel fixed-effect models are estimated. The first is for aggregate machinery imports, chemicals imports and agricultural exports. The second is for disaggregated exports and imports according to the respective destination and source regions above. The third is for aggregate imports and disaggregated tariffs implemented by the various export destination regions toward the SADC. The results agree with the theory that international trade is good for development. Agricultural market expansion through export opportunities and access to inputs are significant sources of agricultural production enhancement in the SADC region. Tariffs barriers to agricultural exports are found to be significant impediments to agricultural production. However, the disparity of effects by export destination and the insignificance of the impact of trade with the rest of Africa are worth emphasising.     

Inflation and Relative Price Variability: New Evidence for the United States

This article provides new evidence on the empirical relationship between inflation and relative prices in the United States. In line with the predictions of recent monetary search models, we find that the impact of expected inflation on relative price variability (RPV) has disappeared during the recent period when inflation expectations have been stabilized on a low level. Endogenous break‐point tests are applied to identify the timing and to confirm the significance of the changing role of inflation for RPV. The empirical findings are robust with respect to different price indices, disaggregation levels, and measurement concepts.     

全球生产网络、贸易结构与工资差距：来自中国的证据

论文通过建立全球生产网络的中间投入品模型,实证分析中间品贸易对一国技术劳动力和非技术劳动力工资差异的影响。研究发现：加工贸易是中国融入全球生产网络的典型形态;其出口会扩大对技术和非技术劳动力的需求。但技术劳动力的工资上涨幅度要高于非技术劳动力的工资涨幅,从而使相对工资差距扩大。短期内,中间品的进口减少了技术劳动力的需求和就业,但长期来看中间品进口会扩大对技术劳动力的需求,相对工资差距拉大。人力资本投资的供给增长由于未能满足劳动力市场的需求,从而在一定程度上表现为工资差距拉大;但长期来看,人力资本积累机制的完善使得相对工资差距会逐渐缓和。