Tariffs,foreign capital and immiserizing growth

For a small tariff-imposing country, within the standard two-commodity two-factor model of international trade, this paper reconsiders the implications of an inflow of capital from abroad. When the host country continues to import the capital-intensive good while remaining incompletely specialized, the analysis shows that the capital inflow must reduce host-country welfare, assuming that the foreign capital receives the full (untaxed) value of its marginal product. Under other circumstances considered, however, the inflow may have different consequences for welfare.     

CAPITAL INFLOW UNDER VOLUNTARY EXPORT RESTRAINT

This paper investigates the welfare consequence of exogenous capital inflow for the host country when the source country implements ‘voluntary export restraint’. In an imperfectly competitive market with an increasing returns to scale (IRS) sector, we show the possibility of welfare immiserization. Two channels are identified leading to immiserization. First, and this is direct, resource reallocation following capital inflow can squeeze the underproduced sector and reduce welfare. Second, contraction of the IRS sector can raise the return to capital, even when the price of the capital‐intensive importable falls unambiguously. Thus, even with an improvement in commodity terms of trade, the factor terms of trade can worsen and reduce welfare.     

MARKET STRUCTURE,CAPITAL INFLOWS,AND HOME WELFARE

The welfare implications of foreign capital inflows in an economy with an imperfectly competitive product market and a capital-intensive import-competing sector are analyzed. If the market structure is exogenous with a fixed number of firms, then a capital inflow improves welfare of the host country. However, if the market structure is endogenous, then a capital inflow tends to be immiserizing because it increases entry and reduces per firm output, thus driving firms up their average cost schedule. In addition, the welfare implications of capital inflows in the presence of trade restrictions are also studied, generating some new insights.     

Is FTA/EPA effective for a developing country to attract FDI? The knowledge‐capital model revisited

To prepare an answer to the question of how a developing country can attract foreign direct investment (FDI), this paper explored the factors and policies that may help bring FDI into a developing country by utilising an extended version of the knowledge‐capital model. With a special focus on the effects of a free trade agreement (FTA) or an economic partnership agreement (EPA) between a pair of market and non‐market countries, simulations with the model revealed the following: (i) although FTA/EPA generally tends to increase FDI to a developing country, the possibility of improving welfare through increased demand for skilled and unskilled labour decreases as the size of the country grows; (ii) a developing country may suffer severe welfare losses through FTA/EPA if the availability of skilled labour is extremely limited; and (iii) a developing country can enhance welfare gains from a FTA, and it is even possible to recover the welfare effects from negative to positive, by making the arrangement an EPA.     

基于噪声甄别模型的我国FDI福利效应的差异性分析——来自1997-2009年的数据证据

运用含有噪声的甄别博弈模型,分析得出东道国在引资过程中需要结合自身情况和其他引资国的政策制定符合本国福利增进的引资分割点,且东道国引资优惠额度越大反而越有可能损害本国福利。在此基础上结合我国1997-2009年引进FDI数据进行实证分析得出:(1)整体FDI对我国福利效应的增加带来了积极作用,但FDI对收入福利指数的贡献较小,对生产福利指数贡献较大;(2)自2005年开始,制造行业FDI对我国福利增加的贡献率趋于减小且有恶化趋势;而处于农、林、牧、渔业和信息传输、计算机服务和软件行业的FDI对我国福利的贡献率却逐渐增加;(3)处于后危机时代的FDI在引资政策上更应该重视产业导向以提升FDI的正向福利效应。     

外商直接投资技术外溢吸收能力影响因素研究——基于中国29个地区面板数据分析

东道国的吸收能力是外商直接投资技术外溢实现的关键;文章论述了技术外溢的产生途径;对中国29个地区面板数据的平稳性进行检验,从东道国吸收能力的角度分析影响外商直接投资技术外溢的因素:人力资本、经济开放度、基础设施等。实证研究结果表明,高等教育和高中教育的人力资本、基础设施建设和外商直接投资相结合对技术外溢的吸收能力有正向作用,而对外贸易和初中、小学的人力资本尚未构成对外商直接投资技术外溢的促进作用。     

资本流入对国内福利的影响

本文分析了在不完全竞争的产品市场中,在东道国的进口竞争性部门为资本密集型的情况下,外资流入对福利的效应问题。如果市场结构是外生的,那么资本流入会提高东道国的福利;然而,如果市场结构是内生的,由于资本流入导致新企业进入市场,从而提高了企业的平均成本,这样,资本流入反而会有贫困化效应。此外,本文还提出了一些新的观点,即研究了在考虑贸易中的一些限制性条件的情况下,资本流入对福利的效应。     

Book review

The existing literature on offshoring neglects the importance of host country conditions in affecting the boundaries of a firm. In this paper, we focus on the role of the host country's human capital in affecting the organization of offshore production. Acknowledging that an input is produced offshore only after training the host labor, we propose that this training cost depends on the human capital gap between the home and the host country. Our model finds that a sourcing firm prefers to offshore production internationally only if the human capital gap between the home and the host country is below a threshold. Secondly, as the human capital gap increases, the probability for international outsourcing vis-à-vis intra-firm trade increases. Finally, as opposed to conventional wisdom, our model shows the possibility of outsourcing inputs of a high-tech good when the human capital gap between the home and the host is high.     

Temporary social dumping,union legalisation and FDI: a note on the strategic use of standards

This paper analyses the welfare implications for a developing country of using union legalisation as a policy instrument to attract inward foreign direct investment. While its presence may discourage a foreign multinational (MNE) from locating in the host country, unionisation is an important rent-extracting instrument for the host country. We show that if the MNE benefits from dynamic effects, the host country government may have an incentive to adopt temporary social dumping: banning the union in the short run to extract higher rents in the future. However, if the government can use a fiscal instrument in conjunction with union legalisation, the former can circumvent the need to engage in social dumping.     

Unionized labor markets and globalized capital markets

This paper studies the effects of international integration of capital markets in a world where countries differ in their labor market institutions: one country has a perfectly competitive labor market while the other is unionized. We show that workers should favor autarky in the unionized country, but oppose it in the non unionized country and vice versa for owners of capital. Aggregate gains from integration, however, are negative. We also show that, under capital mobility, an increase in relative bargaining power of unions does not always improve workers' welfare.     

Minimum wage,unemployment and international migration

"The link between immigration and unemployment among the native workers of the host country is examined within a model which distinguishes individuals in terms of their ability to perform services in the labor market. An inflow of foreign workers is found to have an ambiguous effect on the level of income received by the native factors of production. This is in sharp contrast to the findings that immigration improves welfare in a fully employed host country and that it unambiguously lowers welfare in a minimum-wage economy with homogeneous labor."     

Tariff Discrimination versus MFN under Incomplete Information

This paper presents a model of legal migration of temporary skilled workers from one source country to two host countries, both of which can control their levels of such immigration. Because of complementarities between capital and labor, the return on capital is positively related to the level of immigration. Consequently, when capital is immobile, host nations' optimal levels of immigration are positively related to their capital endowments. Further, when capital is mobile between the host nations, the common return on capital is a function of the levels of immigration in both countries, meaning that immigration is a public good. As a result, when immigration imposes costs on host countries, the Nash equilibrium results in free riding and less immigration than would occur in the cooperative equilibrium. These results are qualitatively unaltered when capital mobility extends to the source nation.     

外资并购对先进制造业基地建设的影响

全球化背景下,先进制造业基地的形成路径发生了改变。外资并购对东道国先进制造业基地的形成产生重要影响,它不仅能促进东道国产业成长、技术进步,而且有利于东道国产业集聚形成、生产规模扩大及出口数量增加;但同时也可能使外资企业的市场支配力加强、抑制本土企业的成长、危害东道国产业安全。我国应利用外资并购这种高层次利用国际资本形式,为打造先进制造业基地提供新的推动力。     

东道国税收激励政策的福利效应分析

应用税收激励来吸引外商直接投资是目前世界上大多数国家常用的政策手段。然而,税收激励政策在促进东道国经济增长的同时对东道国福利的影响是不确定的,需要对税收激励政策的成本和收益进行综合评估。本文对经典的Macdougall一般福利效应模型做进一步拓展,引入税收激励来分析外商直接投资对福利效应的影响,结果表明:税收激励政策能否增进一国福利水平主要取决于外资企业的技术外溢。从这个结论出发,本文对我国当前税收优惠政策的福利效应进行评述,进而对我国外商投资税收优惠提出政策建议。     

转轨制国家国内横向资本税竞争的模型分析

本文分析了转轨制国家国内地方政府间的资本税竞争,认为一定条件下的地方政府间资本税竞争可以在一定程度上提高全国居民的福利水平;不过,经济转轨初期的各地方政府似乎更愿意采取协同一致的税收政策,因为实行这样的税收政策对地方政府的自身利益较为有利。     

FDI Inflow and Human Development: Analysis of FDI's Impact on Host Countries' Social Welfare and Infrastructure

We examine the impact of foreign direct investment (FDI) and the mediating effects of country national governance on the welfare and knowledge infrastructure of host countries. Based on a five‐year anchored panel data of 175 countries producing over 9,000 observations, we find that in general FDI has a positive influence on both host country welfare and knowledge infrastructure and the national governance positively mediates these relationships.¹ © 2013 Wiley Periodicals, Inc.     

Strategic and institutional effects on foreign IPO performance: Examining the impact of country of origin,corporate governance,and host country effects

Integrating signaling and institutional perspectives, we develop and test hypotheses relating institutions and corporate governance to foreign IPO success. Our investigation highlights the importance of three important drivers of foreign IPO success: home country legal institutions, corporate governance, and host capital market choice. This research demonstrates that board independence and country of origin effects are powerful signals. However, these factors do not have a universal impact on foreign IPO success. Instead, the value of home country institutions along with corporate governance signals are contingent upon the institutional environment in which international entrepreneurs choose to seek capital resources.     

Optimal tax and tariff policies with tax credits

This paper examines the optimal tax and tariff policies for a small open economy when mobile capital receives a tax credit for taxes paid to the host country. For a capital-importing country, a tax on capital equal to the source country tax rate (to capture tax revenue) combined with a subsidy to encourage capital imports is the optimal policy. Results are also derived for cases in which only one of the instruments can be varied. For a capital-exporting country that cannot reduce its capital tax rate, a subsidy to the sector using exported capital is desirable.     

Money,saving and growth in an international economy with perfect capital mobility

The effects of differential national saving rates on current accounts, foreign indebtedness and the welfare of the countries involved are examined within the framework of a two-country, three-asset and one-good model of growth with international capital mobility. It is argued that the persistent current account imbalance and its implied national indebtedness are a natural consequence of differential national saving rates in the world of integrated capital markets, that any direct interference hampering an orderly flow of capital makes both countries worse off, that changes in the exchange rate mainly reflect the differential growth rates of two currencies and have little effect on the current account, and that persistent current account deficits do not necessarily imply an ever-increasing debt burden. While an increase in the saving rate of the high-saving country benefits the low-saving country, an increase in the saving rate of the low-saving country harms the high-saving country both in the short run and the long run.