Multidimensional financial development,exporter behavior and export diversification

Financial development shapes export sector performance because exporters need external finance and face credit constraints. Previous empirical research has relied largely on single-country studies. The Exporter Dynamics Database (EDD), which features firm-level exports from over 60 countries, reveals differences in the microstructure of the export sector across countries. In this paper, we first provide new evidence that these differences are related to cross-country variation in financial development and structure. Second, we combine the EDD and multidimensional data on financial development with a global database on export diversification. This study is the first to examine how macrolevel export diversification is determined by the microcharacteristics of the export sector. This approach is novel in the empirical literature on export diversification. According to our cross-country analysis, access to domestic financial services positively contributes to export diversification by increasing the number of small exporters, as financial services ease the credit constraints these exporters face.     

The cost and composition of Indian exports

India has a history of export promotion policies extending back into the 1950's. These policies seem to have been applied without regard to comparative advantage and this study indicates the high cost of India's disregard for economic efficiency. Using the domestic resource cost concept as the criterion for measuring relative export efficiency, the present structure of Indian exports is examined on both the sectoral and product level. The results show not only an unacceptably wide divergence in the domestic resource cost of exports on the margin - indicating a misallocation of resources in the export sector - but also an export incentive system which fails to select India's most efficient exports.     

Export promotion as a development strategy

This paper has two aims. First it presents a model of the advantages of promoting exports. Second, it warns that in such a model, export promotion may be of benefit only to a limited group of countries. Encouraging others to become outwards oriented may be detrimental to welfare. The fact that, for the exporting sector to be viable, the scale of the exporting sector must be large relative to the optimal scale of exporting firms is advanced as the motivation for export promotion. I then argue that the scale of the exporting sector may, in equilibrium, be a signal of the export good's quality. Large capacities in the sector are required to convince importers to pay high prices. Such high capacities may effectively deter countries capable of producing only low quality goods from subsidizing exports.     

Trade Sophistication Indicators: Balancing Diversity and Specialization

Motivated by the important role of trade in driving and reflecting economic transformation, we focus on the export structure of two small export-oriented economies, Ireland and Finland 2000–2009, from the perspective of the sophistication of both economies’ exports, i.e., the extent to which high-value products characterise each country’s export profile. The Product Space method is used as the basis of our comparison of the economies in terms of their sectors, activities, and structural transformation of the economies. The method focuses attention on the estimated density of the product space as evident in patterns of revealed comparative advantage (RCA) in goods exports. The Information and Communication Technology (ICT) sector, as a significant export sector for both economies, is examined specifically to investigate its further export potential.     

Foreign Exchange Accumulation and the Entrapment of Chinese Monetary Power: Towards a Balanced Growth Regime?

This article criticises the notion that China's foreign exchange reserves have strengthened its monetary power. While some scholars have argued that China's international monetary influence has been ‘entrapped’ by the domestic interests of its export sector, a one-sided focus on the export sector fails to identify the significant constraints on its macroeconomic autonomy. This article proposes an extension of the concept of entrapment that draws attention to the key role of state-owned enterprises (SOEs) and their domestic fixed-asset investment in its growth regime: China's external monetary dependency – which is understood as both export dependency and the need to maintain foreign exchange accumulation – has been caused by a disparity between fixed-asset investment and private consumption that reflects a redistribution of income from the household sector to the SOE sector. In particular, I expose the SOE sector's rising interests in foreign exchange accumulation by uncovering a mutually reinforcing dynamic between China's external monetary dependence and the financial repression of its banking system. By entrenching an investment-led growth regime that provides key benefits the SOE sector, this dynamic is found to have seriously constrained the macroeconomic policy autonomy of Chinese authorities to rebalance growth away from investments and exports towards private consumption.     

Non-scale endogenous growth effects of subsidies for exporters

We built a general equilibrium endogenous growth model in which final goods are produced either in the relatively skilled-labour intensive exports sector or in the relatively unskilled-labour intensive domestic sector. We show that, by affecting the technological-knowledge bias, subsidies explain the simultaneous rise in the exports sector, the skill wage premium and the economic growth rate. Then, to shed light upon the causal nexus between production-related subsidies and exports, we use a Portuguese longitudinal database (1996–2003) and implement a propensity score matching approach. Empirical results seem to prove the theoretical predictions: subsidies generate the rise in the wage premium of exporters and the increase in the relative size of export sector, even if no impact of subsidies is found in the capacity of transforming domestic firms into new exporters.     

The impact of FDI on host countries: the analysis of selected service industries in the Visegrad countries

Foreign direct investments are substantial in the services sector in the Visegrad countries. In this article, we analyse the impact of FDI on the host economy in four selected service industries in two areas: export and employment. FDI in the four selected service industries differ in terms of their vertical or horizontal nature: in business services FDI is predominantly vertical; in financial services and telecommunications it is predominantly horizontal; while in computer-related service activities both types can be found. According to our results, the impact on the host economy differs in the four service industries. We found a positive and significant impact on exports in vertical business services and in horizontal telecommunications services, and on employment in business services and, to a lesser extent, in financial services. The positive impact either diminished or disappeared during the global recession of 2008–2009. The comparison of the four Visegrad countries demonstrates the heterogeneous intensity and significance of this impact, indicating their different specialisations in the analysed services industries.     

Is aid for trade effective? A panel quantile regression approach

This paper investigates whether Aid for Trade (AfT) leads to greater exports in recipient countries. Using panel quantile regression and two strategies to address endogeneity (AfT lagged by two periods and dynamic OLS), our results suggest that total AfT disbursements promote the export of goods and services mainly for the lower quantiles (0.1, 0.25, 0.50) of the conditional distribution of exports. Hence, countries that export less in volume are those benefitting most from AfT. This effect is mainly driven by the impact on exports of goods rather than on that of services. We also investigate which types of AfT are effective when endogeneity is controlled for. The main results show that whereas aid to improve trade policy and regulation is associated with higher exports for all quantiles, aid used to build infrastructure is found to affect exports at only the lowest tails of the distribution (0.10–0.35) and aid to build productive capacity is generally more effective for the lower quantiles of the export distribution (0.10–0.50). In contrast, aid disbursed for general budget support (an untargeted type of aid) is not associated with greater export levels. This finding holds irrespective of the quantile.     

EXPORTS AND JOBS: THE CASE OF JAPAN, 1975–2006

This paper asks how much employment is created by increasing goods and services exports and how the export dependence of employment has changed over time. Using the newly developed Japanese input‐output table for 1975–2006, this paper estimates the effect of exports on an industry's employment (i.e., direct effect) and the effect on other industries' employment (i.e., indirect effect). One of our major findings is that the magnitude of the indirect effect exceeded that of the direct effect over almost the entire period. This implies that more than half of the effects of exports appeared through intraindustry linkages. We also found the indirect effect of goods exports is not limited to goods industries. As a result, the increases in the export dependence of employment are not limited to major Japanese export‐oriented industries such as electrical machinery, motor vehicles, and general machinery. In identifying the potential risks of negative external shocks, it is important for policy makers to estimate how much employment is indirectly as well as directly dependent on exports. (JEL F16, F14)     

Does China really lose from RMB revaluation? Evidence from some export industries

This study attempts to examine the impacts of Real Exchange Rate (RER) misalignment on China's export performance. Using the SUR methodology coupled with disaggregate panel export data, it shows that China's export sector may not necessarily lose from the Central Government's decision to revalue its RMB against the US dollar because the negative impact of the RER appreciation on Chinese exports may be diluted by the positive impacts attributing to a reduction in the RER misalignment.     

Dutch Disease in Australia: Policy Options for a Three‐Speed Economy

‘Dutch Disease’ refers to the adverse effects through real exchange rate appreciation that the mining boom can have on various export‐ and import‐competing industries. The distinction is made between the booming sector (mining), the lagging sector (exports not part of the booming sector and import‐competing goods and services) and the non‐tradeable sector. What should the government do to reduce this Dutch ‘disease’? The principal options are: do nothing, piecemeal protectionism, moderate exchange rate effects by running a fiscal surplus, combined with lowering the interest rate, and possibly establishing a sovereign wealth fund. The costs of the latter measures may be considerable.     

影响中国服务贸易出口的可量化因素分析

根据1990-2004年中国服务贸易出口及其可量化因素的时间序列数据建立的多元线性回归模型,印证了人均国内生产总值、世界GDP增长率、服务业占GDP的比重、货物贸易出口额等因素对中国服务贸易出口的影响。因此,应优化服务贸易出口结构。扩大市场开发度和加大政府支持力度,以增加中国服务贸易的出口。     

中、日、韩知识密集型服务贸易结构变动及比较优势的实证研究——基于RCA与特化系数等的分析

笔者从进出口总量、贸易结构与贸易竞争力3个角度,应用对称性RCA指数、特化系数等指标,对于21世纪以来中、日、韩知识密集型服务贸易比较优势与贸易结构变化进行了比较分析。研究结果表明:中国知识密集型服务贸易逆差较大,且呈现出扩大的趋势,对知识密集型服务贸易需求急剧增长;在知识密集型服务贸易领域,中国在整体上比较优势弱,与日本、韩国相比,还有很大差距;从分项目的知识密集型服务贸易来看,中国位于知识密集型服务贸易的低端,中国弱势行业多为2国强势行业,中国通讯贸易与韩国通讯贸易在出口上存在竞争。     

Real exchange rate and export performance in Argentina, 2002–2008

Between 2002 and 2008, Argentina experienced a phase of very high and sustained economic growth. During this period, macroeconomic policy aimed to preserve a stable and competitive real exchange rate (SCRER). There is controversy on whether the SCRER policy was a key factor fostering growth and, even more, on whether it helped promote the expansion of tradable activities and exports. We use a methodology to detect episodes of export surges among Argentina’s export industries and find that labor-intensive industries—especially low- and medium-technology manufactures—experienced the highest proportion of export surges within this period. We also find that between 1980 and 2015, the highest proportion of surges in total exports occurred during the 2003–8 period. The performance of export of services was also particularly dynamic during this period. This evidence suggests that the SCRER policy was instrumental for export surges in Argentina during 2002–8.     

US Exports of Knowledge-intensive Services and Importing-country Characteristics

This paper studies the determinants of US exports of knowledge‐intensive services. Using US export data to as many as 29 countries between 1989 and 2002, I find the following. First, gross product and per capita income have heterogeneous effects on affiliated and non‐affiliated exports of knowledge‐intensive services. Secondly, property rights protection matters. Thirdly, infrastructure quality and political institutions only matter in the transfer of knowledge assets. Finally, financial depth is only correlated with the export of services to non‐affiliates.     

Export Performance of China: A Constant Market Share Analysis

In the light of the fact that there has been substantial growth in China's exports in last three decades, particularly after China joined the WTO in 2001, this article investigates the major sources of China's export performance during 2002-2014 by using the constant market share (CMS) model. In this study, exports are further decomposed in three categories based on their technological intensity using Lail (2000) classification on 3 digit SITC Revision-3 data provided by UN Comtrade via WITS database. The categories are high technology, medium technology and low technology. It is found that growth of China's exports has, moreover, remained above world exports growth in all three categories during the period of study. The analysis reveals that export performance is mainly attributed to 让s competitive strength in the global market, though decreasing trend has been observed in the competitiveness of all three categories. Increasing cost of labor and appreciating RMB could be the causes behind decreasing competitiveness of Chinese exports. Product structure effect, on an average, has turned out to be negative in all the categories which is the most disturbing aspect of China's export performance. On the other hand, geographical structure effect has positive impact on export performance of high-technology based exports whereas it has negative impact on export performance of low-technology and medium-technology based exports. China being the world's largest exporter, decreasing competitiveness and wrong product structure effect could adversely influence its export performance in particular and its growth in general.     

Non‐linear effect of exchange rate volatility on exports: the role of financial sector development in emerging East Asian economies

This paper empirically examines the role of financial sector development in influencing the impact of exchange rate volatility on the exports of five emerging East Asian countries – China, Indonesia, Malaysia, the Philippines and Thailand – using a GMM‐IV estimation method. The results indicate that the effect of exchange rate volatility on exports is conditional on the level of financial sector development. The less financially developed an economy, the more its exports are adversely affected by exchange rate volatility. In addition, a stable exchange rate seems to be a necessary condition to achieve export promotion via a currency depreciation in these economies.     

AUSTRALIAN COMMODITY EXPORT PASS-THROUGH AND FEEDBACK CAUSALITY FROM COMMODITY PRICES TO THE EXCHANGE RATE

Commodity export pass-through is examined for Australia in an attempt to determine whether Australia is a price-taker in its commodity export trade. This is undertaken for seven categories of Australia's main commodity good exports. We also determine if there is feedback causality from particular world commodity prices back to the exchange rate as is often hypothesised for commodity good intensive exporting countries. It is found that Australian commodity good export pass-through is complete for the goods which are relatively less important in its export trade but is incomplete (although high) for the goods which are most important in its export trade. There is significant feedback causality to the exchange rate from the world price of coal and wheat, two of Australia's most important commodity good exports over the 1980s and early 1990s.     

Explaining the Timing of Australia's Manufactured Export Boom

Abstract
This article seeks to explain some of the recent growth in Australia's manufactured exports using a sunk cost model. It is shown that a shock to the economy can cause a sudden and permanent increase in exports. Results from a sample survey suggest that the increased export orientation of Australia's manufacturing sector may persist, even if the recent economic shocks faced by exporters are reversed .     

Input–output analysis of virtual water transfers: Case study of California and Illinois

Increasing pressures on water resources in the two economically important states of California (CA) and Illinois (IL) have created a need for critical information related to sustainable water use and management. This paper applies input–output (IO) analysis to evaluate water use and quantify virtual water transfers involving the two states. Results show that aquaculture requires the largest input of direct water per unit of economic output, followed by crops, power generation, livestock, mining, services, domestic, and industry. Low water use intensity industry and services sectors contributed the largest proportions of value added and employee compensation. In 2008, the two states were net virtual exporters, with CA exporting 1.3 times the net export volume of IL. More than 72% of virtual water exports for each state originated from the high total water use intensity but low value added crops sector, with irrigation and rainfall contributing 99% and 97% of the crop-related exports for CA and IL, respectively. Virtual water export volumes were 59% for CA and 71% for IL when compared to actual water use. These results highlight the need to consider water use efficiency and opportunity cost when managing water under scarcity conditions.