MFN Status and the Choice of Tariff Regime

The gradualist approach to trade liberalization views the uniform tariffs implied by MFN status as an important step on the path to free trade. We investigate whether a regime of uniform tariffs will be preferable to discriminatory tariffs when countries engage in non-cooperative interaction in multilateral trade. The analysis includes product differentiation and asymmetric costs. We show that with the cost asymmetry the countries will disagree on the choice of tariff regime. When the choice of import tariffs and export subsidies is made sequentially the uniform tariff regime may not be sustainable, because of an incentive to deviate to a discriminatory regime. Hence, an international body is needed to ensure compliance with tariff agreement.     

Does Intra‐regional Trade Matter in Regional Stock Markets? New Evidence from the Asia‐Pacific Region

We provide new evidence on the relationship between bilateral trade and stock market returns across the Asia‐Pacific region. Using three country blocs in this region, including the Far Eastern bloc, the Chinese bloc and the Australian bloc, we examine whether trade linkages between countries affect their stock returns. Incorporating two distinct dynamic properties of regime shifting and cointegration in intra‐regional trade and stock market returns, we employ the newly suggested multivariable smooth transition autoregressive vector error correction model (STAR‐VECM). A series of estimations reveals evidence that bilateral trade significantly Granger‐causes stock returns in the Asia‐Pacific region, with effects that are asymmetric depending upon the stock market regime and the country pair. Among the three blocs, the Far Eastern bloc displays a more pronounced positive effect of bilateral trade growth on stock returns than do the other blocs.     

Vertical Trade,Exchange Rate Pass-Through,and the Exchange Rate Regime

We compare the welfare of different combinations of monetary and currency policies in an open-economy macroeconomic model that incorporates two important features of many small open economies: a high level of vertical international trade and a high degree of exchange rate pass-through. In this environment, a small economy prefers a fixed exchange rate regime over a flexible regime, while the larger economy prefers a flexible exchange rate regime. There are two main causes underlying our results. First, in the presence of sticky prices, relative prices adjust through changes in the exchange rate. Multiple stages of production and trade make it more difficult for one exchange rate to balance the whole economy by adjusting several relative prices simultaneously throughout the vertical chain of production and trade. More specifically, there is a tradeoff between delivering an efficient relative price between home and foreign final goods and delivering an efficient relative price between home and foreign intermediate goods. Second, because the small economy faces a high degree of exchange rate pass-through under a flexible regime, it suffers from a lack of efficient relative prices in vertical trade. The larger economy, however, does not face this problem because its level of exchange rate pass-through is low.     

贸易自由化与环境保护的平衡——世界贸易组织框架下的环境保护机制探析

作为以促进贸易自由化为宗旨的国际组织,世界贸易组织在平衡贸易自由化与环境保护关系方面显得步履艰难。在制度设计上,世界贸易组织偏重于对贸易自由化的维护,而在案件审理实践中,争端解决机构则越来越顾及环境保护的要求。在新一轮的“多哈回合”中,各方对贸易与环境议题的争论和分歧较大,谈判的失败标志着世界贸易组织框架下的贸易和环境的利益平衡将面临着更多的挑战。     

Air cargo transport in APEC: Regulation and effects on merchandise trade

This study aims at assessing the link between a more liberal air cargo regime and increased bilateral merchandise trade in the Asia Pacific region, under the auspices of APEC. Results from a gravity model using the Air Liberalisation Index (ALI) developed by the WTO Secretariat provide strong support for two hypotheses. First, more liberal air services policies are positively, significantly and robustly associated with higher bilateral trade in merchandise. The results also show that air transport policy matters more for some sectors than for others. A particularly strong relationship is found between bilateral liberalisation and trade in manufactured goods, time sensitive products, and parts and components. Prior to taking account of general equilibrium effects, the estimates imply that a one point increase in the ALI is associated with an increase of 4% in bilateral parts and components trade, which is the sector found to be most sensitive to the degree of aviation liberalisation. These findings have important policy implications. In particular, economies actively seeking greater integration in international production networks could greatly benefit from a more liberal aviation policy regime.     

贸易开放、投资效率与中国的经济增长——基于“Krueger-Bhagwati”范式的经验研究

本文采取以制度分析为基础的"Krueger—Bhagwati"范式作为理论依托,以Dollar系数作为衡量贸易开放度的指标,对1953~2004年中国贸易开放与经济增长之间的关系进行了回归分析。结果显示,贸易开放促进经济增长的机制在于消除国内市场价格扭曲,减少非生产性寻利行为,提高了投资效率。同时,中国的确存在出口导向型增长,但这种增长方式为满足国外部门需求而挤压国内消费,容易产生经济波动。因此,对进出口采取一致激励的中性贸易体制是现阶段更为理想的体制选择。     

Regulating for telecommunications competition in developing countries: Papua New Guinea

Papua New Guinea is a low‐middle income, developing, Pacific country whose telecommunications market has developed under regulatory arrangements strongly influenced by Australian policymaking. Nevertheless, it demonstrates very weak performance compared to similar low‐middle income countries. Why does a country whose regulatory regime draws on current international recommended ‘best practice’ perform so poorly? We develop an inquiry framework based on World Bank and the International Telecommunications Union guidelines for assessing the effectiveness of regulatory arrangements in a developing country. The framework takes account of developing country challenges: limited capacity, limited commitment, limited accountability, limited fiscal efficiency, and trade‐offs between factors that take account of these limits. The analysis indicates the most likely explanation for poor performance derives from lack of investment and an unstable set of ownership arrangements constraining government‐owned Telikom from being an effective competitor. Weaknesses in regulator accountability provisions may have contributed to obscuring poor performance. Introducing at least one more foreign operator will improve outcomes only with clear separation of government ownership and regulatory activities and credible commitment from political agents to refrain from interfering in operations of both the incumbent firm and regulatory agencies.     

Interlopers and disorderly brethren at the Stade Mart: commercial regulations and practices amongst the Merchant Adventurers of England in the late Elizabethan period

This article examines the role of merchant companies in structuring overseas trade in early modern Europe by considering the commerce of the Merchant Adventurers of England, the ‘regulated’ Company which monopolized the cloth export trade to Germany and the Netherlands in the sixteenth and seventeenth centuries. It examines the Company's trade to its German ‘mart’ town of Stade at the close of the sixteenth century through a detailed case study of the trade of one particular merchant, John Quarles. Using correspondence between Quarles and his factors overseas, it considers how membership of this regulated trading company impacted on the practice of its members, both through its formal regulatory regime and the informal pressures that came with corporate affiliation. However, corporate privileges also created ‘shadow economies’ inhabited by the excluded, those castigated by companies as ‘interlopers’. The article considers the connections between interlopers and those ‘disorderly brethren’ of the company who were prepared to violate corporate regulations in pursuit of opportunities. It shows how the regulatory regimes of merchant companies were shaped by the changing practices of members and non‐members as they responded to the structural changes facing European trade in the early modern period.     

Institutional determinants of Indonesia's sugar trade policy

An analysis of contemporary sugar trade policy in Indonesia highlights problems in the institutional framework for trade policy making. The institutions through which sugar trade policy is formulated entrench the interests of rent-seeking bureaucrats, import licence holders and traders to the detriment of consumers and downstream producers of processed products. Moreover, the resulting trade policy regime has problematic effects on sugarcane farmers. The structure of regulatory intervention is due less to democratic pressures than to the inclusion of vested interests in the institutions that formulate policy. Further, the lack of effective mechanisms for inter-ministerial coordination and for resolving conflicting policy preferences among ministries hinders the development of coherent trade policy and obstructs reform efforts. An institutional framework that facilitates representation of all interests affected by sugar trade policies and public scrutiny of the effects of policy intervention is likely to deliver better outcomes for consumers and producers alike.     

Internationalization of information technology services and public policy implications

World telecommunications traffic grew at a rate of over 15% a year in the 1980s, substantially faster than merchandise or service trade. The growth of such traffic is linked closely to the international flow of services and investment. Economizing on time, inventories and financial balances are important considerations in the use of international telecommunications networks. At the same time, network providers are engaging in international alliances to supply a variety of telecommunication services across borders. These alliances will influence strongly the further evolution of national and international regulatory regimes. An international regime more open in the trade of services and movement of investment is called for.     

经济一体化与香港股市的国际联动实证研究

本文从汇率制度、利率水平、国际贸易、投资群体等方面,分析香港股票市场所处的宏观管理运行环境,考察香港和美国的密切经济关系,研究全球一体化不断加深的情形下香港、日本和美国股市的动态关系。研究结果表明,三大市场的动态关系依然存在;但恒指跟上证指并不存在协整关系。     

Impact of Regulatory Burdens on International Trade

In this paper, we develop the additional compliance requirement indicator (ACRI) to quantify the extra regulatory requirements that an exporter may face when serving the foreign country's market. The higher the value of ACRI, the greater the difference between the sets of technical measures in the destination and origin countries. Employing the ACRI, we estimate the impact on trade of regulatory burdens via product-level bilateral gravity equations. We find a significant negative impact of regulatory burdens on bilateral trade for a full sample, but the estimated trade effects vary across sectors and depend on the development levels of the trading countries.     

Rebalancing and the Chinese VAT: Some numerical simulation results

This paper presents numerical simulation results that suggest that China can both reduce its trade imbalance and receive welfare benefits by switching the value added tax (VAT) regime from the current destination principle to an origin principle. We modify the traditional general equilibrium tax model to capture endogenous trade imbalances along with endogenous factor supply, a fixed exchange rate and a non-accommodative monetary policy structure which supports the Chinese trade imbalance. We calibrate model parameters to 2008 data and simulate counterfactual equilibrium for VAT tax basis switches in which the trade imbalance changes. Our results suggest that given China's trade surplus VAT regime switching to an origin basis can decrease China's trade surplus by over 40%, and additionally increase Chinese and world welfare. This has implications for present G20 discussions on finding ways to adjust global trade imbalances.     

人民币汇率与中国贸易平衡:基于汇改后数据的实证研究

本文运用计量方法考察汇率制度改革后贸易平衡价格弹性的变化和人民币升值对中国贸易平衡的影响.主要得到以下的结论:自2005年7月人民币汇率制度改革以来,我国贸易平衡的价格弹性显著增强,汇率的价格信号机制有所加强,表明汇率制度改革使人民币汇率更好地发挥对贸易收支的调节作用;人民币升值不能显著减少中国贸易顺差,但人民币升值会改变中国与不同贸易伙伴之间的贸易平衡关系;汇率制度改革后的人民币升值对工业制成品贸易的影响要大于对初级品贸易的影响.     

服务贸易、非对称开放与全球失衡:一项跨国的经验研究

文章从贸易内部结构出发，分析非对称开放条件下，服务贸易兴起与全球失衡之间的关系。并利用全球59个主要贸易国家2000-2014年双边贸易数据对两者之间的关系进行计量分析，实证结果显示：第一，服务贸易净值与经常账户余额之间存在显著的负向关系，服务贸易净值提高100万美元，经常账户余额减少98.7万美元。在引入交互项之后这种关系依然显著成立。因此，服务贸易的非对称开放是造成全球失衡的重要原因。第二，技术进步和利率上调可以扭转服务贸易对经常账户的抑制作用。第三，金融危机之后，服务贸易和经常账户的负向关系进一步强化。后危机时代，全球失衡现象有可能继续恶化。第四，分位数回归发现，在低点位处服务贸易净值对经常账户的影响更为强烈。文章的研究为理解中国的服务贸易逆差提供了新的视角，并为扭转服务贸易逆差奠定了理论基础。     

“Large” and “small” regional trading blocs and trade regime bias: A comparison of the EC and CARICOM

‘Large’ and ‘Small’ Regional Trading Blocs and Trade Regime Bias: A Comparison of the EC and CARICOM. — Liberalizing trade on a regional basis may, but does not necessarily, reduce trade (anti-export) bias; the outcome depends upon the characteristics of the regional grouping and the height of external tariffs. There are a priori grounds for expecting trading arrangements for ‘small’ blocs to induce greater trade regime bias than ‘large’ ones. This paper explores the reasons for this, and provides evidence of potential trade regime bias from CARICOM (Barbados) and the EC (UK). The paper also considers to what extent regional commitments may constrain the scope for lowering trade regime bias, and investigates some of the national and regional policy options for lowering the bias associated with ‘small’ regional trade arrangements.     

Exchange rates and the trade balance: the case of Singapore 1970 to 1996

The purpose of this paper is to examine the relationship between the real trade balance and the real exchange rate for bilateral trade in merchandise goods between Singapore and the USA on a quarterly basis over the period 1970 to 1996 using the partial reduced form model of Rose and Yellen (1989). We also hope to shed further light on what has become known as the ‘Singapore export puzzle’: the observation that, despite periods of rapid nominal and real appreciation of the Singapore dollar, export growth in aggregate has remained buoyant.Our findings suggest that the real exchange rate does not have a significant impact on the real bilateral trade balance for Singapore and the USA, thus confirming previous work which finds a weak relationship between changes in the exchange rate and changes in export and import prices and volumes for Singapore. We also found little evidence of a J-curve effect. Although positive coefficients linking real exports with lagged values of the real exchange rate might be indicative of ‘small country’ pricing by exporters in U.S. dollars, it is not clear that this is masking J-curve effects from an initial rise in import values as the home currency depreciates.     

Productivity,Trade, and Institutional Quality: A Panel Analysis

Recognizing that gains historically attributed to trade capture instead the roles of institutions and geography, we estimate the relationship between labor productivity and trade for a panel of countries, 1980 to 2000. We use real and nominal openness as measures of trade. The endogeneity of trade and institutional quality is accounted for with instruments. Our trade instrument is based on a theoretically motivated gravity equation and uses a more comprehensive data set than in related studies. Fixed‐ and random‐effects and system‐GMM panel estimation methods address potential biases associated with cross‐section estimations. We find a robust relationship between real openness and labor productivity from the 1990s. Countries that trade more generate higher levels of productivity, supporting an institutional theory of growth. We find evidence that countries with low‐quality institutions benefit from openness to trade and that the positive effect of trade on labor productivity is lower for more populated countries.     

Study of the Measurement and Determinants of Intra‐industry Trade in East Asia*

The present paper investigates the development of intra‐industry trade (IIT) among the East Asian economies over the 1970–1996 period. A dynamic index is used to capture the changes in the structure of trade flows. Based on this approach, IIT is decomposed into horizontal (HIIT) and vertical components (VIIT) and the determinants of each are investigated. The results show that both HIIT and VIIT have exhibited increased importance over the sample period in manufacturing. Using pooled panel data the two‐way trade in all measures of IIT is found to be positively related to the country‐specific variables, such as the market size, exhange rate depreciation, the levels of development and income, and negatively to the geographic proximity of the partners. Economies of scale are seen to have a positive influence on IIT and HIIT, but a negative relationship with VIIT. Although the relative openness of a country's trade regime shows no significant relationship with any form of IIT, a trade imbalance does affect IIT and HIIT flows. The findings have implications for assessing the structural adjustment costs associated with the trade liberalization process as HIIT is associated with demand for variety and relates to two‐way trade in goods of similar quality, while VIIT is driven by international specialization and differences in relative factor endowments.     

The EU-Korea FTA: anticipation,trade policy uncertainty and impact

Anticipatory trade effects of free trade agreements (FTAs) have been documented in various papers. One reason put forward trying to explain this phenomenon is reduced trade policy uncertainty. This paper is one of the first to explore the role of anticipation and trade policy uncertainty in the case of a recently concluded deep and comprehensive EU FTA, including significant behind the border measures. We use monthly data at a lower level of aggregation (8-digit level) compared to previous studies and we account for changes in the EU product classification over time. We also distinguish between the impact on products which are actually subject to liberalisation under the FTA as opposed to those which are already duty-free and we examine the effects on both the extensive margin and the intensive margin. We consider the impact of the FTA during three different periods of time (the start of negotiations, initialling of the agreement and entry into force), while comparing with the period before negotiations began. The results indicate that the FTA has had a positive impact on exports on both margins. The impact on the EU is somewhat higher indicating that EU exporters have more to gain in terms of increasing the predictability of the trade policy regime of the destination market and lowering its tariffs than vice versa. The results demonstrate that the impact of FTAs should not be assessed against the time period just prior to entry into force of the agreement, but much earlier to account for anticipation effects.