U.S. bilateral trade balances and the dollar

U.S. bilateral export and import values with seven large trading partners are tested for real exchange rate effects over 1975–1985. The results suggest that dollar devaluation would have the most favorable impact on the U.S. trade balance in the case of Japan and the least favorable in the case of Canada.     

U.S. trade remedy law and agriculture: trade diversion and investigation effects

Abstract .  We study U.S. agricultural antidumping and countervailing duty cases from 1980 to 2005, and gauge the effectiveness of trade remedy law as a form of protection. The purpose is to measure the resulting investigation and trade diversion effects. Previous research on trade in manufactured products has shown that the domestic protection offered by AD and CV duties is largely offset by trade diversion. In contrast, we find that for agriculture, trade diversion is relatively unimportant. So AD and CVD cases are very effective forms of protection for U.S. agriculture.     

The Costs of U.S. Hegemony: Military power,military spending,and U.S. trade performance

For David Gordon and his collaborators in the social structures of accumulation (SSA) tradition, the willingness to threaten potential adversaries with military forces capable of acting on a global scale was seen to positively affect the U.S. terms of trade. U.S. hegemony yielded specific supply side benefits as favorable terms of trade reduced relative input prices and boosted profitability. Although Gordon and his co-authors recognize the potential costs of sustaining a large, globally active military apparatus, these costs are not incorporated in the econometric models supporting the SSA theory. This paper attempts to extend the SSA analysis by empirically measuring the effects of both military spending and military power on U.S. trade performance over the 1951–1987 period. It is shown that while military power and spending commitments may have positive effects on the terms of trade, these military variables had direct and indirect negative impacts on the U.S. net export balance and therefore domestic aggregate demand. In the context of a model of U.S. growth performance open to international transactions, the overall effect of the postwar military system on U.S. economic growth was likely negative in the cold-war era     

The Canada U.S. free trade agreement: Competitive tradeoffs between foreign direct investment and trade

This paper assesses the impact of the Canada U.S. Free Trade Agreement on exports and foreign direct investment of processed foods. Results indicate that U.S. exports to Canada more than doubled, while Canadian exports to the U.S. nearly doubled after the implementation of the Canada U.S. Free Trade Agreement in 1989. Regression results of the covariance model on panel data show that U.S. and Canadian food processing firms appear to use both exports and foreign direct investments as complementary market access strategies. This research was supported by a grant from the Canadian Embassy. In addition, the authors thank Carolyn Dimitri of the University of Maryland for helpful comments.     

Industrial policy and U.S.-Japanese trade

We find that while the depreciation subsidy and special treatment from the MITI has significantly promoted the Japanese trade advantage, legalized cartelization status in Japan has not had any apparent effect on bilateral trade with the U.S.     

Adjustment in the process of trade liberalization: The U.S. and Mexico

Although many of the issues in North-American trade liberalization are reminiscent of those faced earlier by Europeans and by the United States and Canada, there are also some non-trivial differences. Divergences in economic structure are more pronounced. They affect the interplay of various sources of welfare gains and costs and are likely to make inter-industry and vertically integrated intra-industry trade more important Non-tariff barriers play a greater role in the present context and the welfare effects of preferntial elimination of quantitative restraints differ in important respect from those of tariffs. A free trade area, for example, which is clearly trade-diverting under tariff liberalization may be trade-creating under quantitative restrictions.     

Confidence and the transmission of macroeconomic uncertainty in U.S. recessions

This article studies the role of confidence in the transmission of uncertainty shocks during U.S. recessions. I use smooth-transition vector-autoregression (ST-VAR) to examine the regime-dependent effect of uncertainty shocks, and a counterfactual decomposition to isolate the role of confidence when the economy is in different regimes, recessions and non-recessions. I find that shutting down the confidence channel leads to greatly dampened and less persistent effects of uncertainty shocks, especially during recessions. I also find that the cross-regime difference in the role of confidence can largely explain the cross-regime short-run difference in the effects of uncertainty shocks.     

Asymmetric J-curve: evidence from industry trade between U.S. and U.K.

ABSTRACT

Previous research that assessed the impact of exchange rate changes on the trade balance between the U.S. and U.K. assumed the effects are symmetric. In this paper, we add to the literature on the asymmetric J-curve phenomenon by considering the trade balance of 68 two-digit industries that trade between the two countries. We find short-run asymmetric effects of the real dollar-pound rate in almost all industries. However, short-run asymmetric effects were translated into significant long-run asymmetric effects in 25 industries. Indeed, the asymmetric J-curve hypothesis was supported in 18 industries.     

The political economy of trade and migration: Evidence from the U.S. Congress

We compare the drivers of U.S. congressmen's votes on trade and migration reforms since the 1970s. Standard trade theory suggests that trade reforms that lower barriers to goods from less skilled‐labor abundant countries and migration reforms that lower barriers to low‐skilled migrants should have similar distributional effects, hurting low‐skilled U.S. workers while benefiting high‐skilled workers. In line with this prediction, we find that House members representing more skilled‐labor abundant districts are more likely to support trade and migration reforms that benefit high‐skilled workers. Still, important differences exist: Democrats are less supportive of trade reforms than Republicans, while the opposite is true for migration reforms; welfare state considerations and network effects shape votes on migration, but not on trade.     

Tax policy and investment in major U.S. macroeconomic econometric models

In an analysis of six major U.S. quarterly models, the predicted results of tax incentives for investment are found to vary widely. Differences are traced to critical specifications in investment equations. When appropriately revised investment equations are reestimated the role of tax parameters is much reduced, particularly among the high outliers, and the variance among the models is narrowed decidedly. Full model simulations of revised equations suggest that current and proposed incentives such as the investment tax credit and accelerated depreciation are not cost-effective. Increases in investment approximate only half of static tax losses, and budget deficits widen.     

The election cycle in the inflation bias: evidence from the G-7 countries

This paper derives and evaluates empirical implications which separate the naive voters view [Nordhaus, W.D., 1975. The political business cycle. Review of Economic Studies 42, 169–190.] from the rational-voters view [Barro R., Gordon, D., 1983. Rules, discretion, and reputation in a model of monetary policy. Journal of Monetary Economics 12, 101–121.] under rational expectations. The observational equivalence of the two approaches obtained under a natural rate vanishes as output persistence is introduced. An analysis of inflation in the G-7 countries reveals election patterns supporting the joint hypothesis that demand shocks persist and that monetary policy courts retrospective voters. Patterns turn weaker as central banks become more independent, but do not disappear. Reducing inflationary bias not only requires more central bank independence, but as well less persistence.     

U.S. farm dynamics and the distribution of U.S. agricultural subsidies

The persistent instability of the agricultural sector is the fundamental premise of most agricultural policy. Yet no research has ever quantified the aggregate dynamics of individual farms in the US. This article is the first to combine the US Census of Agriculture with the Agricultural Resource Management Survey to observe the dynamics of nearly 1.5 million farms. The data reveal substantial variation in farm size expansion and contraction. Most of this variation is unobservable in the sector totals reported by the US Department of Agriculture each year. The distribution of agricultural subsidies suggests that subsidies become more important as farms get smaller and may play a role in slowing farm size contraction.     

Determinants of household saving in the G-7 countries: recent evidence

This paper employs data from the last four decades to analyse major determinants of household saving for the Group of Seven (G-7) nations. Particular attention is paid to the effects of interest rates, government saving, and social security contributions. Regression analysis is used to control for the effects of both the level and changes in income per capita and inflation.     

中美贸易背后的利益分析

文章首先介绍了中美贸易的不平衡发展，然后重点分析了在中美贸易中的贸易利益流向和对双方的经济影响，进而找到解决此问题的积极可行的对策。     

中美贸易背后的利益分析

文章首先介绍了中美贸易的不平衡发展,然后重点分析了在中美贸易中的贸易利益流向和对双方的经济影响,进而找到解决此问题的积极可行的对策.     

Plucking models of business cycle fluctuations: Evidence from the G-7 countries

Friedman's `plucking' model, in which output cannot exceed a ceiling level but is occasionally plucked downward by recessions, is tested using Kim and Nelson's formal econometric specification on output data from the G-7 countries. Considerable support for the model is obtained, leading us to conclude that during normal periods, output seems to be driven mostly by permanent shocks, but during recessions and high-growth recoveries, transitory shocks dominate. During these periods macroeconomic models that emphasise demand-oriented shocks, rather than real business cycle type models, may thus be more appropriate. First Version Received: September 2000/Final Version Received: May 2001     

Global slack and domestic inflation rates: A structural investigation for G-7 countries

Recent papers have argued that one implication of globalization is that domestic inflation rates may have now become more a function of “global”, rather than domestic, economic conditions, as postulated by closed-economy Phillips curves.This paper aims to assess the empirical importance of global output in determining domestic inflation rates by estimating a structural model for a sample of G-7 economies. The model can capture the potential effects of global output fluctuations on both the aggregate supply and the aggregate demand relations in the economy and it is estimated using full-information Bayesian methods.The empirical results reveal a significant effect of global output on aggregate demand in most countries. Through this channel, global economic conditions can indirectly affect inflation. The results, instead, do not seem to provide evidence in favor of altering domestic Phillips curves to include global slack as an additional driving variable for inflation.     

The Japanese information economy: Its quantification and analysis in a macroeconomic framework (with comparisons to the U.S.)

Japan is one of the leading information societies and there is official policy promotion of its information economy image. In this study the information sector of Japan is measured and analysed within a macroeconomic framework, using input-output techniques. Important benchmark statistics on both the primary and secondary information sectors are derived and compared to those obtained in an earlier study of the U.S. The analysis reveals the high growth potential of both information sectors in the two economies. However, important inter-country differences also emerge, in particular in regard to the amount of resources devoted to the information task at the disaggregated sector level. This leads to a discussion of the relationship between investment in the information sector, organisational design, informational efficiency and productivity growth, which is seen to be of crucial importance for the future success or failure of the two economies. Limitations of the approach adopted in this study and areas for further research are indicated.     

Emerging market sovereign spreads,global financial conditions and U.S. macroeconomic news

We investigate the impact of global financial conditions, U.S. macroeconomic news and domestic fundamentals on the evolution of EMBI spreads for a panel of 18 emerging market (EM) countries using daily data. To this end, we consider not only the conventional panel cointegration procedures but also the recent common correlated effects method to tackle cross-section dependence that may stem from common global shocks such as contagion. The results suggest that the long-run evolution of EMBI spreads depends on global financial conditions, crises contagion and domestic fundamentals proxied by sovereign ratings. The results from panel equilibrium correction models suggest that EMBI spreads respond substantially also to U.S. macroeconomic news and changes in the Federal Reserve's target interest rates. The magnitude and the sign of the effect of the U.S. news, however, crucially depend on the state of the U.S. economy, such as the presence of inflation dominance.     

International benefits policy: a U.S. multinationals perspective

An international benefits policy requires considerable planning both at the corporate level and in relation to the local environment. The creation of such a policy also calls for careful research into the company's basic benefits philosophy.