Aid for trade and the quality of exports

This article studies how aid for trade (AfT) affects the quality of recipient countries’ exports. It shows that the quality effect is most discernible for AfT for assistance in trade policy: a 50% increase in the value of AfT received in this category is associated with a 0.5–1% increase in the quality of exports to the donor and other OECD countries. On average, the actual AfT received for assistance in trade policy leads to a 2% upgrade of the recipient country in the quality ladder of all developing countries. Around half of this quality effect is driven by the quality improvement of continued products in continued markets (intensive margin), and the other half by the quality upgrading of new products in continued markets and existing products in new markets (extensive margin).     

Industrial de-licensing, trade liberalization, and skill upgrading in India

We investigate the relationship between industrial de-licensing, trade liberalization, and skill upgrading during the 1980s and 1990s among manufacturing plants in India. We use a unique dataset on India's industrial licensing regime to test whether industrial de-licensing during the 1980s and 1990s played a role in skill upgrading, as measured by the employment and wagebill shares of white-collar workers. In addition, we assess the relative contribution of industrial de-licensing and trade liberalization to skill upgrading. We identify two main channels through which industrial de-licensing affects skill upgrading: capital- and output-skill complementarities. Using both difference-in-differences as well as regression discontinuity techniques, we find two important results. First, after controlling for the size-based exemption rule that determined whether or not a plant faced licensing restrictions, industrial de-licensing during the 1980s appears to have increased the relative demand for skilled workers via capital- and output-skill complementarities. Capital- and output-skill complementarities exist for plants in both licensed and de-licensed industries but were stronger in de-licensed industries during the 1980s, prior to India's massive trade liberalization reforms in 1991. Second, regardless of de-licensing, capital- and output-skill complementarities are generally weaker after trade was liberalized during the early 1990s. Together, capital- and output-skill complementarities contributed 75% (57%) and 31% (29%), respectively, of the growth in the employment and wagebill shares of white-collar workers in de-licensed (licensed) industries before trade was liberalized. After trade liberalization, these contributions were smaller. This suggests that trade liberalization may not have played a major role in raising the relative demand for skilled labor during the early 1990s.     

Does input sector liberalization promote quality innovation and exports?

This paper examines the relationship between input sector liberalization and product quality innovation and export orientation by a LDC firm given the complementarity between high input quality and high product quality. We show that input sector liberalization per se may not induce quality innovation and outward orientation. In fact, in some situations, ceteris paribus input sector liberalization may increase the odds in favour of low-quality production. We show that total output sector liberalization, or surprisingly, a suitable degree of output sector protection is needed to be combined with input sector liberalization so that quality innovation is induced.     

Reassessing the productivity gains from trade liberalization

This paper reassesses the impact of trade liberalization on productivity. We build a new, unique database of effective tariff rates at the country‐industry level for a broad range of countries over the past two decades. We then explore both the direct effect of liberalization in the sector considered, as well as its indirect impact in downstream industries via input linkages. Our findings point to a dominant role of the indirect input market channel in fostering productivity gains. A 1 percentage point decline in input tariffs is estimated to increase total factor productivity by about 2 percent in the sector considered. For advanced economies, the implied potential productivity gains from fully eliminating remaining tariffs are estimated at around 1 percent, on average, which do not factor in the presumably larger gains from removing existing non‐tariff barriers. Finally, we find suggestive evidence of complementarities between trade and FDI liberalization in boosting productivity. This calls for a broad liberalization agenda that cuts across different areas.     

Financial liberalization and the relationship-specificity of exports

We investigate the causal impact of equity market liberalizations on sectoral export performance across 91 countries (1980–1997). The increased availability of external finance has boosted trade of industries that intensively use relationship-specific inputs, and lowered exports of industries using standardized inputs.     

Input trade liberalization and import switching: Evidence from Chinese firms

This paper investigates how input liberalization affects firm import behavior. Using comprehensive production and trade data of Chinese firms, the paper shows that firms switch import sources from developing countries to developed countries as Chinese input tariffs fall. This finding is evident for import value and import scope. The observation holds after excluding the possible influence of reducing processing trade. The paper further demonstrates that the mechanism can be attributed to quality upgrading and innovation led by input cost reductions. The analysis handles the possible endogeneity problem, and the findings are robust and significant to different empirical methodologies and measurements.     

Agricultural trade liberalization under bilateralism: an international network perspective

Global negotiations in agricultural trade have been considered unsuccessful. Given this fact, the paper studies whether bilateral agreements, rather than global agreements, can lead to Agricultural Global Free Trade by means of decoupled and compensatory payments. For this purpose, the new advances of the international trade network literature have been adopted.     

Carry trade and forward premium puzzle from the perspective of a safe‐haven currency

Swiss franc exchange rates exhibit safe‐haven characteristics, which suggest a close link between the forward premium puzzle and profitability of the carry trade. Our analysis of Swiss franc exchange rates shows that the two phenomena are distinct from each other, thus corroborating U.S. dollar evidence. Persistent exposures to two different global shocks drive the two phenomena in Swiss franc exchange rates. Moreover, we find significant links between expected average Swiss franc exchange rate changes and macroeconomic conditions during the period of the minimum Swiss franc exchange rate against the euro, but not during the rest of the sample period.     

Smoothing the adjustment to trade liberalization

Empirica - We use a dynamic general equilibrium trade model with comparative advantage, heterogeneous firms, heterogeneous workers and endogenous firm entry to analyze economic policy meant to...     

Export,FDI and the welfare gains from trade liberalization

This paper extends Melitz and Redding (2015) to analyze the welfare gains from trade liberalization by adding foreign direct investment(FDI). Our model predicts that with FDI activities, welfare gains from trade liberalization will be strictly lower than those in a model without FDI, but only takes exports into account. In addition, the calibrated model indicates that with FDI activities, aggregate welfare reaches its maximum when the fixed export costs are positive rather than 0. Furthermore, we decompose the welfare gains induced by trade liberalization from continuing exporters, and switchers. The results show that in any case, with or without FDI, continuing exporters contribute a larger share to welfare gains than status switching firms.     

Tariff liberalization and trade specialization: Lessons from India

This paper analyzes the effects of policy reform on the structure of India’s trade in manufactures, from 1990 to 2006. It computes comparative advantage indicators on the basis of disaggregated trade flow data and assesses the effects of trade liberalization on the evolution of India’s pattern of trade specialization. Industries where import tariffs have been reduced the most have experienced the highest increase in specialization. Moreover, trade liberalization has helped India improve its comparative advantage in industries with medium- to high-technology content, as well as in some of the industries enjoying the most robust growth in global demand. Liberalization policies have been instrumental in enhancing the international competitiveness of industries.     

The new regionalism: trade liberalization or insurance?

Several of the recently negotiated regional trade agreements contain significantly fewer concessions by the large countries to smaller countries than vice versa. In this paper, we compute post‐retaliation Nash tariffs by region under various regional trade arrangements using a calibrated numerical general equilibrium model of world trade. Regional agreements constrain strategic behaviour within each trading area, and (in the Customs Union case) enhance it outside the bloc. Results confirm the intuition that without side payments large‐small country regional agreements (such as the Canada‐U.S. agreement) would not have occurred. Le nouveau régionalisme: libéralisation du commerce ou assurance? Dans plusieurs des accords de libre échange régionaux négociés récemment, les grands pays accordent beaucoup moins de concessions aux petits pays que les petits aux grands. Dans cet article, les auteurs mesurent, à l'aide d'un modèle numérisé d'´equilibre général du commerce mondial, les droits de douane à la Nash après ajustements réciproques. Il semble que les accords régionaux contraignent les comportements stratégiques dans chaque bloc, et (dans le cas de l'union douanière) renforcent les comportements stratégiques hors du bloc. Ces résultats confirment l'intuition qui suggère que, sans ces arrangements parallèles, les accords entre grands et petits pays (comme l'accord U.S.A.‐Canada) ne se matérialiseraient pas.     

The quality and variety of exports from the new EU member states

The goal of this article is to evaluate the variety and quality of exports from the new EU member states (NMSs) in the period 1999–2009. The practical relevance of such an analysis is threefold: recent studies underline the importance of export variety for economic growth; empirical results show that export variety was influenced by the EU membership; and looking separately at export quality permits a better understanding of price competitiveness. Our results show that all NMSs significantly increased the average number of brands exported to the EU market, the largest increases being observed in 2004 and after. This indicates that integration into the EU market occurs in the extensive as well as the intensive dimension. We also find that all NMSs increased the average quality of their exports during the decade studied although there are differences between countries. Thus, a large part of the increase in the prices of exports from NMSs resulted from improving quality and did not result in a loss of competitiveness. Finally, estimates of relative quality are much more stable than relative prices, suggesting that our measure of relative quality is better than the traditional proxy.     

Sanitary and phytosanitary measures in Chinese agricultural exports: the role of trade intermediaries

We study the effect of sanitary and phytosanitary (SPS) measures on Chinese agricultural exports and the role of trade intermediaries in this process following China’s accession to the World Trade Organization. While both agricultural exports and SPS regulations have grown, the use of trade intermediaries has declined sharply. We develop a model of heterogeneous producer-level decisions about choice of export mode that is consistent with this trend. In our econometric analysis, we analyse the effects of SPS measures and trade intermediaries on Chinese fruit and vegetable exports using transaction-level customs data. In contrast to much of the literature, we find some evidence of positive relationships among SPS measures, trade intermediaries and exports.     

Tariff pass-through and the distributional effects of trade liberalization

This paper estimates the distribution of welfare gains due to the trade reforms in India by simultaneously considering the effect on prices of tradable goods and wages. The cost of consumption for each household is affected by the domestic price changes, while wage incomes adjust to these price changes in equilibrium. Three rounds of the Indian Employment and Consumption Surveys are used for the analysis. The price transmission mechanisms are estimated for both rural and urban areas to understand the extent to which the trade reforms are able to affect the domestic prices. In order to assess the distributional effects, a series of nonparametric local linear regressions are estimated. The findings show that households at all per capita expenditure levels had experienced gains as a result of the trade liberalization, while the average effect was generally pro-poor and varied significantly across the per capita expenditure spectrum.     

The welfare implications of trade liberalization between the Southern Mediterranean and the EU

The impact on the Southern Mediterranean Countries (SMC) of the current process of trade liberalization with the European Union is explored. The methodology is that of computable general equilibrium modelling under imperfect competition and the model includes ten countries and 11 sectors. This allows for both a cross-country and cross-sectoral analysis of the results. The experiments considered are the full liberalization of tariffs, as well as changes in market access and trade-induced changes in productivity. A key feature of the paper is that the phased introduction of tariff reductions is allowed for as explicitly envisaged in the Agreements. The results show that the process of liberalization may have a substantial, though non-monotonic, impact on the SMC economies in terms of both changes in production and through this on welfare. The welfare impact is potentially very high in particular for the high tariff economies. The sources of the welfare gain tend to derive from perfectly competitive explanations of trade for the high tariff economies, and from imperfectly competitive explanations of trade for the low tariff economies.     

On the welfare effects of trade and investment liberalization

Using a three-factor knowledge- and physical capital model of trade and multinational activity, we consider a set of policy experiments to assess the welfare effects of trade and investment liberalization in general equilibrium. Specifically, we address the question of whether and under which circumstances a single versus a combined trade/investment liberalization strategy or a unilateral versus a bilateral policy change is preferable from a single country's and the world's point of view. The focus of this paper is to look at three relevant questions. First, when is investment liberalization beneficial and when is it harmful for a single economy or the whole world? Second, is pure investment liberalization a welfare maximizing strategy? Third, when is either kind of liberalization (trade, investment, or both) welfare improving and when neither of them?     

Research on the exports trade of Shandong agricultural products

This paper analyses the internal problems and external constraints against the further development of exports trade of Shandong agricultural products. The countermeasures in solving those problems and constraints are recommended to ensure a sustainable development of Shandong regional agricultural products exports.     

An analysis of government expenditure and trade liberalization

The effect of trade liberalization on government's role in the economy is investigated. It is shown that, contrary to received expectations, as small open economies liberalize their trade, the size of government decreases.     

政府支出与贸易自由化分析

原载:Applied Economics,Vol.37,No.16,Sept.,2005人们研究了贸易自由化对政府在经济中作用的影响。研究显示,与被普遍接受的预测相反,当小型开放经济实行贸易自由化时,其政府的管理范围缩小了。一、引言贸易自由化问题(以及关于这个问题的争论)可以追溯到亚当·斯密。根据Edwa