The Disciplinary Effect of the Single Market on Swedish Firms

In the 1980s it became increasingly clear that the European Community market was still segmented by national borders because of non-tariff barriers to trade. A major objective of the Single Market Program in 1992 was to remove these barriers, thereby enforcing intra-union competition. In this paper, a panel of Swedish firm-level data is used to evaluate whether domestic market power has been curtailed as a consequence of the SMP and of the Swedish membership in the European Union in 1995. Evidence of increased competition emerges, as price-cost margins have declined in industries with high non-tariff barriers prior to 1992. JEL Classification Numbers: F15, L11, C33     

Does International Fragmentation Occur in Sectors Other Than Machinery?*

It is well established in the published literature that international fragmentation has dramatically developed in East Asia since the 1990s, particularly in machinery industries, including general machinery, electric machinery, transport equipment and precision machinery. However, how far has international fragmentation developed in sectors other than the machinery sector, such as textiles or chemicals? To answer this question, we empirically investigate whether features of international fragmentation appear in other sectors by examining intraregional trade in East Asia. The results indicate that, although some features of international fragmentation can be observed in some other sectors, particularly in the chemical sector, they are most distinctive in the general/electric machinery sector.     

International Monetary Instability All Over Again

One of the signature developments of 2016 was the move from globalization and market integration toward nationalism and protection. A headline in the Financial Times (April 13, 2017) read, “‘Sword of protectionism hangs over trade’, says IMF.” The headline demonstrates “Silo-ism”. The Fund does not recognize that the demand for import barriers in countries with large trade deficits and high unemployment have resulted from massive imbalances in international payments. Monetary instability in the 1920s and the 1930s was reflected in the overvaluation of the British pound, the undervaluation of the French franc and subsequent overvaluation of the U.S. dollar. Britain voted to leave the European Union in June 2016, in part because the high price of the British pound depressed exports and wages in manufacturing. U.S. gross domestic product (GDP) has doubled since 1980, yet manufacturing employment has declined by eight million. The demand for protection in the U.S. has increased because the more rapid growth of imports than exports has led to the decline of three to four million U.S. manufacturing jobs.     

The fading productivity of schooling in East Asia

We estimate changes in the productivity of schooling for six East Asian countries. Our productivity measure is based on changes in the relative price of schooling. A rising price of schooling relative to other labor-intensive service sectors should indicate declining relative schooling productivity. We find that the price of schooling increased by more than the price of other labor-intensive services in 1980 to 1994. We also find that the cognitive achievement of pupils did not change substantially, which suggests a constant quality of schooling output. Hence, we conclude that schooling productivity has declined. The main reason for the fading productivity of schooling in East Asian countries appears to be a strong decline in the pupil-teacher ratio.     

The International Business Cycle in a Changing World: Volatility and the Propagation of Shocks in the G-7

The changing relationships between the G-7 countries are examined through VAR models for quarterly growth, estimated over sub-periods and using a rolling data window. Trivariate models are employed, each including the US and a European (E15) aggregate. The results show that conditional volatility of growth has declined relatively more since 1980 for E15 than for the US, aggregate European shocks have increased impact on “core” European countries from around 1980, the effects of the US on Europe are largest during the 1970s and the late 1990s, and E15 has a steadily increasing impact on the US economy over time. JEL Classification Numbers: E32, F02, F43     

The Structure of Protection in Indonesia in 1989 1

Around the mid-1980s, Indonesia's protectionist regime supported an industrial structure in which industries were mainly oriented towards producing for the domestic market. Since then, trade policies have shifted to a more outward-looking strategy, stimulating the growth and diversification of non-oil manufactured exports. This paper attempts to quantify the nominal and effective rates of protection resulting from trade policies at the end of the 1980s. After an introduction in which the 1989 trade policies are discussed, estimates of nominal and effective rates of protection are presented. It is shown that though the level of protection has declined since 1987, it still varies widely across economic sectors. Furthermore, despite the more open trade strategy, the paper's findings show that the trade regime remains biased against exports. Finally, by examining some trade policy issues, the paper presents further ways of rationalising the structure of protection in Indonesia's industrial sector.     

Regional Trading Arrangements and Regional Integration

The formation of new or geographically expanded regional trading arrangements is one of the dominant trends in the world economy. This paper reviews the changing nature of regional trading arrangements. In the 1980s and 1990s a new generation of arrangements has gone much beyond the removal of border-trade barriers to the harmonization of non-border instruments such as national subsidies and commodity taxes, standards, business law regulations and competition policy. They also, in some cases, cover service trade and factor trade. These extensions beyond the scope of traditional customs unions and free trade areas pose new questions about the meaning of regional integration. This paper proposes a new definition of regional integration in terms of price convergence and looks at the extent of regional integration in East Asia.     

Regional Trading Arrangements and Regional Integration

The formation of new or geographically expanded regional trading arrangements is one of the dominant trends in the world economy. This paper reviews the changing nature of regional trading arrangements. In the 1980s and 1990s a new generation of arrangements has gone much beyond the removal of border-trade barriers to the harmonization of non-border instruments such as national subsidies and commodity taxes, standards, business law regulations and competition policy. They also, in some cases, cover service trade and factor trade. These extensions beyond the scope of traditional customs unions and free trade areas pose new questions about the meaning of regional integration. This paper proposes a new definition of regional integration in terms of price convergence and looks at the extent of regional integration in East Asia.     

Assessing black progress: employment,occupation, earnings,income, poverty

Farley discusses changes in employment, occupation, earnings, income, and poverty among US blacks. Among black men, there has been a persistent rise in unemployment since 1960. By the early 1980s, 1 black man out of 8 had dropped out of the labor force, compared to 1 in 20 white men. Some contend that many black men lack the skills to be employed or have personal habits and criminal records which make them unacceptable to employers. Others believe that the expansion of federal welfare programs offers attractive alternatives to men who have limited earnings potential. Still others stress that blacks are concentrated within cities, while the growth of employment is occurring in suburbs. Among those blacks over age 54, labor force participation has declined because of improved Social Security benefits, better private pensions, and the greater availability of Supplemental Security Income. The employment of young blacks compared to whites has deteriorated since 1960. For both races, there has been a steady rise in the employment of women. The recent increases, however, have been great for whites. By the early 1980s, white women caught up with black women in terms of employment. Unlike the indicators of employment itself, there is unambiguous evidence that the occupational distribution of employed blacks has been upgraded and is gradually becoming similar to that of whites. Findings from many studies show that blacks once earned much less than similar whites, but this racial difference has declined among men and has nearly disappeared among women. The proportion of blacks impoverished fell sharply in the 1960s, reaching a minimum of 30% in the early 1970s. Since the early 1970s, blacks have made few gains. The proportion impoverished actually increased and the ratio of black-to-white family income declined. The fact that the earnings of black males are no longer rising faster than those of whites and that there is no longer a migration from southern farms to cities plays a role, but changes in family structure are also important. At all dates, poverty rates have been high and income levels low in families headed by women. In 1984, for example, 52% of the black families with a woman as head of household were below the poverty line, compared to 15% of the black married-couple families. While similar trends are occurring in white families, there has been a sharper increase in the proportion of blacks living in these female-maintained families which have high poverty rates.     

Do Japanese Work Shorter Hours than before? Measuring trends in market work and leisure using 1976–2006 Japanese time-use survey

Using Japanese time-use data from the Survey on Time Use and Leisure Activities (STULA), this paper measures trends in average hours worked (market work) and leisure for Japanese over the past three decades. OECD reports at least a 15% decline in market work for Japan since the 1970s. However, holding demographic changes constant, we found that market work per week increased from the 1970s until mid-1980s, and has been relatively stable for the last two decades for both male and female full-time workers. Furthermore, although the market work per week remained relatively constant since the mid-1980s, we found a significant change in the allocation of time to market work within the week during the period. Specifically, when dividing samples into weekdays (Monday–Friday) and weekends (Saturday and Sunday), average hours spent for market work per weekday among full-time males increased by 0.4 h since the mid-1980s, whereas a significant decline in market work on Saturday was observed. This suggests that people shifted their work time from Saturday to weekdays in response to the reduced work week introduced by the amendment of the Labor Standards Act at the end of 1980s. In the meantime, commuting time and home production had decreased by 3 h since the mid-1980s for full-time female workers, indicating that the average hours of leisure had increased for females even though market work remained the same. Interestingly, however, hours for sleep declined consistently over the last three decades, resulting in a 3–4 h reduction per week for both male and female workers. Lastly, a comparison of Japanese and US time-use data suggests that Japanese work much longer than their American counterparts. On average, Japanese males work 10 h longer per week, and Japanese females 7 h longer, than Americans, even after adjusting for demographic differences between the countries.     

Child survival in East Africa: The impact of preventive health care

Since the mid-1980s or earlier, several East African countries have experienced constant or rising child mortality rates concurrent with social and biomedical improvements of the “Child Survival Revolution”. This study examines whether preventive primary health care enhanced early child survival in the late 1980s and early 1990s in five East African countries. Child mortality rates were considerably lower than they would have been in the absence of specific immunizations, access to safe drinking water, fertility regulation, and frequent antenatal care visits. There was, however, substantial missed opportunity for mortality decline as a result of insufficient use of preventive measures. In particular, universal immunization across these countries could have reduced rates of mortality under age two by as much as one-third. Continued pursuit of the goals of the World Summit for Children appears essential to offset macroeconomic and growing epidemiological constraints to child survival in the region.     

Industry Policy in East Asia

This survey examines the role of industry policy in the industrialisation of East Asian economies since the early 1980s. The first section outlines the neoclassical' model and the interventionist literature that has arisen to challenge it. It distinguishes three strands in this literature: the 'structuralist' and the 'strategic' trade models and the 'fair trade' argument. The following sections evaluate the empirical evidence for Northeast and Southeast Asian economies, discuss the analytical and empirical validity of the interventionist literature and in conclusion draw attention to the diminished relevance of industry policy, given the rapid market-driven integration taking place in the Asian-Pacific region.     

Openness,Regional Trade Agreements and Growth: Evidence from Asia*

This paper assesses the relationship between regional trade agreements, trade integration and economic growth in 21 South and South‐East Asian countries over the period from 1980 to 2004. We aim to answer the following questions. First, how does the trade policy of a given country (and countries within the same region) affect a nation's domestic growth? Second, should developing economies in South and South‐East Asia engage in regional trade agreements (RTA) or move towards broad liberalization? Our results show that openness of either a single country or of its neighbors does not affect a nation's growth and that the impacts of RTA are unclear (if not detrimental to growth in some cases, once endogeneity is accounted for). Panel Granger‐causality tests running from openness to growth yield mixed results and some conclusions depend on the particular subsample under scrutiny.     

From protectionism to free trade fever? Recent reforms in developing countries

During the 1980s, increasing numbers of developing countries unilaterally liberalized their trade regimes. This paper presents an overview of this dramatic shift from protectionism toward freer trade. South Asia, Latin America, and East Asia have implemented extensive reforms, yet each region has shown a distinct difference in approach and in the degree of liberalization actually achieved. Latin America stands out as moving sharply toward the level of openness of the East Asian Newly Industrialized Countries (NICs). Only in Africa is there little progress toward freer trade.     

从维护公平贸易到变相贸易保护——世界反倾销的兴起与发展

反倾销是近年来国际贸易争端的焦点问题。反倾销政策的起源在于维护国际贸易的公平,但是自20世纪80年代以来,反倾销越来越多地被运用于贸易保护。在某种意义上,反倾销补充、部分替代了以前关税在贸易保护中发挥的作用。大量的发展中国家逐步采取了主动的反倾销策略。冶金、化工、塑料等行业是被反倾销最多的行业。     

The export of manpower from Pakistan to the Middle East, 1975–1985

This article summarizes the major findings of recent research undertaken on: (1) Pakistani migration to the Middle East, and (2) on international labour migration in the Middle East and North Africa. The export of manpower from Pakistan for temporary employment in the Middle East has risen dramatically since the oil boom of the mid-1970s. As a consequence, remittances, which constitute the major gain from migration, have become an important source of foreign exchange, amounting to almost 80% of total merchandise export earnings by 1980/ 1981. The direct beneficiaries of these remittances are a million or so migrant households, whose average premigration income was somewhat above the national average household income. Remittances have enabled these households to significantly increase current consumption and purchase assets with the potential of improving their future income stream. Domestic labour has also benefited to the extent that migration has contributed to rising real wages in recent years.Migration has not, however, been an unqualified gain for the economy as a whole. The major cost has been the decline in productivity caused by the departure of quality labour among manual skills and professional categories, both of which cannot be easily replaced. It seems that, on balance, Pakistan has benefited from this labour export. Prospects for continuing migration on a substantial scale remain good for the near future, provided, of course, that projected growth rates of oil exporters materialize. The net benefits for the economy from migration in the coming years will primarily depend upon the extent to which scarce skills can be speedily replaced and remittances utilized to build productivity-increasing assets.     

Non-Europe: The magnitude and causes of market fragmentation in the EU

Non-Europe: The Magnitude and Causes of Market Fragmentation in the EU. — In 1985 the European Commission diagnosed its member states as suffering from excessive market fragmentation, later referred to as “Non-Europe.” The authors examine the empirical basis for the Commission’s diagnosis using a trade model derived from monopolistic competition. They then investigate the links between the initial size and subsequent evolution of border effects within the EU. The findings support the view that European consumers act as if imports from other members were subject to high nontariff barriers. However, there appears to be almost no relationship between market fragmentation and the barriers that were identified and removed by Europe’s Single Market Programme.     

Yen bloc or koala bloc? Currency relationships after the East Asian crisis

During the 1990s, several studies found evidence for a “yen bloc”, a significant and strengthening relationship between the Japanese yen and East Asian currencies possibly due to regional trade and investment by Japan. It appears that the Australian dollar now plays a similar role in the East Asian region, and the linkages between the Australian dollar and the Asian currencies show as much support for a “koala bloc” as a “yen bloc”. This study concludes that the US dollar appears to have declined in importance in post-1997 crisis East Asia, while Australia and Japan are becoming increasingly important regional influences.     

Tall and shrinking Muslims, short and growing Europeans: The long-run welfare development of the Middle East, 1850-1980

In this study we examine anthropometric data for eight countries in the Middle East for the period 1850-1910, and we follow those countries until the 1980s. The Middle East had a relatively good position during the mid-19th century, if human stature or real wages are considered, but much less so in terms of GDP per capita. Initially low population densities allowed better anthropometric outcomes. The height advantage was due, among other factors, to easier access to animal products. All indicators suggest that the Middle East lost ground after the 1870s relative to the industrializing Countries.     

Targeted poverty investments and economic growth in China

In the mid-1980s, the Chinese government launched its ambitious poor area development policy, which was centered around a series of grant, credit, and Food-for-Work programs. Ironically, for the remainder of the 1980s rural poverty remained at about 90 to 100 million, or approximately 10% of the rural population. The lack of progress cannot necessarily be blamed on ineffective poor area policies, since much of the agricultural economy was mired in a deep recession between the mid-1980s and the early 1990s. By the mid-1990s substantial additional poverty reduction had been achieved. Even in the late-1980s, farmers in many poor counties did better than the national average in terms of income growth. After accounting for the effects of macroeconomic elements, what factors can help explain the differences in performance among poor regions and between poor areas and rich ones? Can part of these differences be accounted for by poor area policies, in general, or by the way local and regional officials allocate their poor area investment funds, in particular?The overall objective of this paper is to analyze the effectiveness of Chinese poor area policy. Specifically, the paper seeks to meet three objectives. First, we want to understand the evolution of poor area policy since the mid-1980s, trying to deduce the true goals of central and regional poor area officials, as well as how these policies have been implemented in the provinces. Next, we want to understand the magnitude and scope of investment into poor areas, and examine if changes in these policies have affected the uses of the investment funds. Finally, we want to determine the effectiveness of the investment of poor area funds, analyzing which types of investments have generated growth, and which ones have not.