Interacting factor endowments and trade costs: A multi-country,multi-good approach to trade theory

We provide a synthetic analysis of the different ways in which countries participate in the world economy. Classic trade questions are reconsidered by generalizing a factor-proportions model to multiple countries, multiple goods or multi-stage production, and country-specific trade costs. Each country's production specialization, trade and welfare is determined by the interaction between its relative endowment and its trade costs. We consider the effects of allowing one good to ‘fragment’ into component and assembly production. The volume of trade and welfare levels are higher with fragmentation for most countries, although for many countries these variables fall with fragmentation.     

Trade facilitation and the extensive margin

The literature on trade facilitation has mostly focused on implications for trade volumes. However, recent theoretical contributions have emphasized that trade costs – such as transaction costs related to cross-border trade procedures – affect both the traded volumes of ‘old’ goods (the intensive margin) and the range of traded goods (the extensive margin). This article therefore tests whether trade facilitation affects the extensive margin by counting the number of 8-digit products that are exported from developing to EU countries, and using this as the dependent variable in an estimation. Moreover, it also tests whether the extensive margins in differentiated and homogeneous goods are affected in the same way by transaction costs. Estimation results suggest that if export transaction costs – proxied by the number of days needed to export a good – declined by 1%, the number of exported differentiated and homogeneous products would rise by 0.6% and 0.3%, respectively. Policy simulations further illustrate that if all countries were as efficient at the border as the most efficient country at the same level of development, the number of exported differentiated and homogeneous products would increase by 62% and 26%, respectively.     

Trade Costs and Changes in Canada's Trade Pattern

This paper measures the size and composition of non‐tariff trade costs such as transport, wholesale, and network costs incurred in Canada's merchandise trade using Statistics Canada's latest ‘trade margins’ statistics. It examines how changes in these trade costs have influenced Canada's merchandise trade pattern and the course of economic integration. Our results show that as tariffs have been substantially reduced and largely abolished, costs associated with transport and distribution services now appear much larger than remaining customs duties; therefore, liberalisation in services might be the next key step in promoting greater merchandise trade. Further, reducing transport and other trade‐related costs has helped ‘reverse’ the ‘home market effect’, expanding Canada's domestic demand and production for exports of differentiated products.     

Cross-border production sharing and exchange-rate sensitivity of Mexico's trade balance

Increasing patterns of international trade occur in the form of cross-border production sharing – the dispersion of separate blocks of an integrated production process across different nations. In the case of ‘standard’ or ‘ordinary’ trade, imports are destined for use in the importing country, and exports are largely produced within the country. However, with production sharing, imported parts and components are destined for inclusion in the country's exports. A depreciation of a nation's currency raises its exports. At the same time, imported components become more expensive, which partly offsets the expansionary effect of the depreciation on exports. Using a simple theoretical framework, this paper shows that production networks lower the sensitivity of a country's trade balance to changes in exchange rates. The empirical examination finds Mexico's Maquiladora trade balance to be unresponsive to changes in both, its real effective as well as its real peso-dollar rates, while that for non-Maquiladora category is significantly responsive, in confirmation with the theorized hypothesis.     

Per capita income,market access costs,and trade volumes

There is strong empirical evidence that countries with lower per capita income tend to have smaller trade volumes even after controlling for aggregate income. Furthermore, poorer countries do not just trade less, but have a lower number of trading partners. In this paper, I construct and estimate a general equilibrium model of trade that captures both these features of the trade data. The key element of the model is an association between trade costs (both variable and fixed) and countries' development levels, which can account for the effect of per capita income on trade volumes and explain many zeros in bilateral trade flows. I find that market access costs play an important role in fitting the model to the data. In a counterfactual analysis, I find that removing the asymmetries in trade costs raises welfare in all countries with an average percentage change equal to 29% and larger gains for smaller and poorer countries. Real income inequality falls by 43%.     

The Economic Impacts of Turkish Accession to the European Union

Half a century has passed and Turkey is no further toward achieving EU membership. Under the mandate of the Barcelona Declaration, EU–Turkish industrial tariffs will be abolished, whilst agro‐food protectionism remains largely intact. Consequently, the direct impacts from a hypothetical EU accession scenario will be concentrated in agro‐food sectors, whilst their share of economic output in Turkey implies ‘secondary’ macro impacts. To this end, a computable general equilibrium (CGE) framework is employed to quantitatively reassess full Turkish accession. Unlike previous CGE studies, agriculture, fishing and food sectors are disaggregated, whilst significant advancements to the ‘standard’ model code are incorporated to capture the vagaries of agricultural factor, input and product markets. In addition, a realistic ‘baseline’ scenario is constructed including ‘up to date’ trade and domestic agricultural policy reforms prior to Turkish entry to the EU. The results show that trade‐led gains in Turkey are moderated due to tariff liberalisation prior to EU entry, whilst Turkey receives significant budgetary transfers from the CAP budget, which are ‘mirrored’ as EU‐27 costs. With additional migration effects, Turkish (EU‐27) production possibilities fall (rise), whilst real income per capita rises (falls).     

Interacting factor endowments and trade costs: A multi-country, multi-good approach to trade theory

We provide a synthetic analysis of the different ways in which countries participate in the world economy. Classic trade questions are reconsidered by generalizing a factor-proportions model to multiple countries, multiple goods or multi-stage production, and country-specific trade costs. Each country's production specialization, trade and welfare is determined by the interaction between its relative endowment and its trade costs. We consider the effects of allowing one good to ‘fragment’ into component and assembly production. The volume of trade and welfare levels are higher with fragmentation for most countries, although for many countries these variables fall with fragmentation.     

后金融危机时代中国国际贸易摩擦的特点、趋势及对策

国际金融危机的爆发将国际贸易推向了贸易保护主义的泥沼,世界主要经济体普遍采取大量不合理的贸易限制与贸易救济措施。中国作为世界第一大出口国、第二大进口国,首当其冲,遭受了众多国家贸易保护主义倾向的反倾销、反补贴等措施,成为首要目标国和最大受害者。贸易摩擦数量居高不下、强度增大;涉及到传统制造业和新兴产业领域;除"双反"措施之外的技术性、绿色壁垒开始增多;摩擦议题也升级到经济体制层面;同新兴发展中国家的摩擦日益增多。后金融危机时代,贸易摩擦已经成为困扰中国对外贸易的一大顽疾。面对这种现状及发展趋势,中国在平常心面对的同时,需要反求诸己、深化改革,礼尚往来、法律抗衡,坐而论道,妥善解决。     

中国企业全球攻略:“三位一体”廓清贸易障碍

当今形势下,全球化战略成为中国企业的必然选择。中国企业应从战略高度上,以全球为市场、以学习为手段,来积蓄国际化经营的知识经验和管理技能,培育能带来持久竞争优势的战略资源与核心能力,构筑全新的竞争优势。但金融危机爆发以来,国际贸易保护主义重新抬头,各国因自身利益而产生的贸易摩擦越来越多。作为世界贸易大国,受国际国内双重因素影响,我国也面临着国际贸易摩擦的高发期,贸易摩擦日益成为阻碍我国企业全球化战略发展的消极因素。为有效破解国际贸易壁垒,妥善处理贸易摩擦问题,推动国内企业向国际型企业成功转变,必须从国家、行业、企业三个层面入手化解国际贸易摩擦。     

Trade booms, trade busts, and trade costs

What has driven trade booms and trade busts in the past and present? We employ a micro-founded measure of trade frictions consistent with leading trade theories to gauge the importance of bilateral trade costs in determining international trade flows. We construct a new balanced sample of bilateral trade flows for 130 country pairs across the Americas, Asia, Europe, and Oceania for the period from 1870 to 2000 and demonstrate an overriding role for declining trade costs in the pre-World War I trade boom. In contrast, for the post-World War II trade boom we identify changes in output as the dominant force. Finally, the entirety of the interwar trade bust is explained by increases in trade costs.     

Trading protocols and price discovery: Implicit transaction costs in Indian single stock futures

We show how trading protocols impede the price discovery process in single stock futures as implicit trade costs outweigh explicit costs. Despite the trade volume dominance, trade costs advantage and leverage efficiency in futures markets, single stock futures account for only 35% of the price discovery vis-á-vis the spot market. Futures market's informational efficiency is adversely affected by market frictions in the form of marketwide position limits, minimum contract values, and margin requirements.     

Adjustment Costs and the Sequencing of Trade Liberalisation

A common feature of trade agreements between countries is that the integration of markets proceeds in stages. This paper examines conceptually the role played by adjustment costs in determining the best way to structure an agreement between two countries when there are multiple sectors to be liberalised. Adjustment costs to liberalisation of industries might influence the timing of liberalisation, with the analysis bearing similarity to why tariff reductions tend to be phased in over time. When two industries have no ‘spillover effects’, trade agreements with sequential liberalisation will be less costly to sustain. However, if the liberalisation of one industry influences permanently the flow of benefits from liberalising the other industry, simultaneous liberalisation may be easier to sustain.     

Innovation and trade with heterogeneous firms

This paper examines how trade liberalization affects the innovation incentives of firms, and what this implies for industry productivity. For this purpose we develop a reciprocal dumping model of international trade with heterogeneous firms and endogenous R&D. Among the robust results that hold both in the short run when there is no entry, and in the long run under free entry are that trade liberalization increases aggregate R&D when trade costs are low and decreases R&D when trade costs are high. Expected industry productivity rises as trade costs fall.     

低碳经济趋势下贸易摩擦及WTO机制困境

国际贸易活动以间接的方式影响着能源消耗以及碳排放的程度,各国在促进贸易发展与实现低碳经济的双重战略要求下,势必会引发新的贸易摩擦,WTO机制在双重目标的要求下陷入困境,如何实现世界低碳经济发展模式和减少贸易领域的摩擦是未来WTO和各国政府亟待研究的课题。     

中国先进制造业价值链跃迁实现路径与保障策略研究——基于中美贸易摩擦背景

基于中美贸易摩擦背景,在对中美贸易及贸易摩擦发展变化进行追溯的基础上,探讨了中国先进制造业在全球价值链中的发展现状,进而对中国先进制造业的国际国内市场需求变化进行了深入研究。提出了中国政府应对贸易摩擦、为产业提供保障的策略及制造业在全球价值链中跃迁的实现路径。     

Distance,production, and trade

Abstract

This paper investigates the relationship between geographical distance and both the extent of trade and foreign production. Industries engaged in exporting and co-production activities across national boundaries are identified through their use of the Offshore Assembly Provisions in the US tariff code. Findings counter conventional wisdom. Trade and foreign production activities are found to drop off rapidly over the first third of the distance scale, rise over the middle portion, reach a peak in the final third, and decline thereafter. This pattern suggests frictions associated with distance can be offset by government policies and other country attributes. Management control, information and communications costs, and the ability to implement just-in-time delivery strategies may not be as distance sensitive as previously thought. Theorists should re-evaluate the role of distance in trade models and refrain from using distance as a proxy for transport costs.     

Intra-industry trade and heterogeneity in pollution emission

This paper develops a model of intermediate goods firms heterogeneity with respect to a pollution parameter to analyze the effects of intra-industry trade on final good output, pollution and welfare. By focusing on intra-industry trade we consider trade between similar countries. We analyze both trade between developed countries, and trade between developing countries. In our model, final good producers pay an environmental tax on the total pollution emitted in their country. Therefore, final good producers determine the overall level of pollution by demanding ‘cleaner’ or ‘dirtier’ intermediate goods. To focus on intra-industry trade we consider only intermediate goods firms trade. We analyze three scenarios: closed economy; open economy with no impediments to trade; and open economy with transportation cost. Our main findings are: i. a developing country closed to trade faces lower final good output and higher total pollution and is thus worse off than a developed country; ii. countries are better off under trade than under autarky, regardless of their development level; and iii. an open economy with low transportation costs are better off than an open economy with no impediments to trade.     

新时期内外贸一体化发展策略研究

内贸和外贸都是一国经济发展的重要动力,二者具有相互支撑、相互促进的作用。长期以来,中国一直实行内贸和外贸两条线管理模式,已经无法满足市场经济和贸易发展的客观要求。在当前全球经济下行贸易摩擦加剧、内外贸都面临着转型、出口消费投资在拉动经济增长中需要进一步协调配合的情况下,必须通过着力打造更加自由便利的国内营商环境、加快构建全国统一大市场大流通体系、大力发展跨境电子商务、扩大服务贸易规模提升发展水平等举措,切实推动中国内外贸一体化发展,为经济增长注入新活力。     

中美农产品贸易收益核算及贸易摩擦的影响分析

在全球生产分割的背景下,海关统计数据由于包含大量重复计算的成分,并不能真实反映一国某部门的贸易收益情况。文章通过构建跨国投入产出模型,定义增加值出口为衡量双边贸易收益的指标,从增加值出口变化趋势、行业分布情况及贸易收益的实现方式,分别剖析2000~2014年中美两国农产品各部门的增加值出口情况。发现中美农产品双边贸易的盈余方实为中国,农产品行业的大量增加值隐藏在本国的其他部门中出口。中国市场对美国农业经济的拉动作用在提升,两国农产品行业实现收益的方式不同,中国越来越趋向于附加值含量低的粗加工中间品出口。两国农产品贸易关系紧密,对第三国市场的依赖不断下降,中美贸易摩擦对两国农产品行业的收益都将造成较大的冲击。