Defence procurement: theory and UK policy

Since the early 1980s, competition as a means of obtaining bestvalue for money has dominated UK defence procurement policy.This paper describes the UK defence equipment market and theprocurement problem. There are sections on the economic theoryof procurement, contracting, regulation and competition. Theconclusion evaluates UK defence procurement policy and assessessome of the policy issues for the 1990s     

Trade policy in Mexico

This paper provides an evaluation of the trade policies applied in Mexico in the last quarter century (1956–1982). It examines the policies in three well-defined periods: (1) 1956–1971, considered to be a period of relative stability following the rapid inflation and devaluations of the first post-war decade, though characterized by increasing overvaluation of the peso; (2) March 1972–December 1976, beginning with the acceleration of government spending under President Echeverria and ending with the devaluations of the peso; (3) December 1976–December 1982, covering the Presidency of José López Portillo. For each period, the author discusses macroeconomic policy, trade policy developments and changes in Mexican exports and imports and their contribution to industrial growth. Having demonstrated the interdependence of macroeconomic and trade policies, the paper concludes with recommendations for policy reform, e.g. for remedying macroeconomic disequilibria, reducing price distortions and reforming trade policy, with a view to moving towards an outward-oriented development strategy in Mexico.     

Trade policies and growth in emerging economies: policy experiments

This paper analyzes a dynamic endogenous growth model to quantify the channels through which international trade affects longer-term growth of an emerging economy, with an emphasis on the role played by trade policies. In the model, trade can promote (i) labor migration from agricultural to non-agricultural sectors and (ii) the inflow of foreign knowledge to enhance productivity in non-agricultural sector. The model is estimated to match with the data from selected advanced and emerging economies. Policy experiments suggest that openness to trade and elimination of trade barriers would raise annual real GDP growth by up to three percentage points for decades.

     

Trade policy and specialization in developing countries

This paper examines the impact of trade policy on specialization patterns in ten Latin American countries over the period 1985–1998. These countries are natural case studies because in the last decades they implemented comprehensive trade liberalization programs, both generally and preferentially, starting from relatively high tariff protection levels. Our econometric results suggest that reducing own most favored nation tariffs is associated with increasing manufacturing production specialization. Furthermore, we find that preferential trade liberalization and differences in the degree of unilateral openness have resulted in increased dissimilarities in manufacturing production structures across countries. These results are robust across specialization measures and estimation methods.

Trade policy and global value chains: tariffs versus non-tariff measures

Review of World Economics - Globalisation is increasingly characterised by intertwined geographical and local production processes through global value chains (GVCs). In the presence of GVCs,...     

Trade policy,productivity and learning: Evidence in South Africa

The theoretical argument in support of trade liberalisation is based, in part, on exports that foster dynamic efficiency gains primarily through learning and technological upgrading. Using data collected in the motor vehicle components industry, the article explores whether there is any evidence in the South African manufacturing sector to support this hypothesis. Although the conclusions are tentative, the author finds no unambiguous empirical support for the argument that, in the South African context, trade liberalisation fosters learning and innovation at the level of the firm.     

贸易政策选择的博弈分析

传统贸易理论与新贸易理论的不同源于假设条件的不同,并由此导致贸易政策选择上的自由贸易政策和战略性贸易政策。本文主要应用博弈理论对战略性贸易政策在不完全竞争市场上对国际贸易的影响进行分析,说明政府使用干预政策时,应充分考虑现实条件,否则其危害可能远远超过自由贸易。     

Fiscal policy and economic growth: some evidence from China

Review of World Economics - China has experienced profound economic and social changes in recent decades. During this period, China’s fiscal policy framework has been substantially reformed....     

Exports and labor costs: evidence from a French policy

We investigate the role that labor costs hold in exporters’ performance. To do so, we exploit a large-scale French reform that granted most firms a tax credit proportional to the wagebill of their employees paid below a given threshold. This policy effectively translated into a cut in labor cost whose magnitude varies depending on firm-specific wage structures. We use the predicted treatment intensity based on pre-reform composition of the labor force as an instrument for the actual policy-induced firm-level change in labor costs. Although our point estimates are consistent with commonly estimated firm-level trade elasticities combined with reasonable labor shares in total costs, coefficients are found to be very noisy, suggesting lack of robust evidence of a causal effect of the policy. We discuss several potential explanations for our results as well as their implications.     

International trade and net investment: theory and evidence

The theory of welfare accounting shows that comprehensive measures of net investment can be used to test whether an economy is following unsustainable paths of consumption. However, the notion of net investment used in most applied studies rules out technological progress and terms-of-trade gains from international trade. This paper considers an augmented expression of net investment derived from a dynamic growth model featuring international trade in different types of resource inputs, exogenous productivity growth in final sectors, and cost-reducing progress in resource extraction. Calculating augmented net investment for the world’s top twenty oil producers, we show that the difference with standard non-augmented measures can be large and may even revert some established conclusions regarding sustainability: prospects are more favorable than previously thought in oil-exporting countries endowed with large reserves like Angola, Azerbaijan, Kuwait, Saudi Arabia and Venezuela. In oil-importing economies, future consumption possibilities are limited by the lack of expected rental incomes from future resource exports.     

Trade policy and protection in the European Community

The European Community is the world's largest trading entity. As a result, trade policy in the EC has an important impact on the world economy. This paper evaluates the formulation of trade policy in the EC and assesses the key instruments, both by sector and by target. The relative importance of tariff and non-tariff barriers is emphasised as is the role of anti-dumping. Finally, the impact of the single market programme and the Uruguay Round are assessed. Both will have a crucial bearing on the evolution of policy.     

Exceptional performance of multinational suppliers: theory and evidence

Review of World Economics - This paper focuses on an unexamined area of trade—the behaviour of heterogeneous intermediate suppliers facing final producers of different ability and pursuing...     

On the cyclicality of schooling: theory and evidence

Economic theory indicates that opportunity- cost considerationstend to make schooling countercyclical whereas ability-to-payconsiderations have the opposite effect. We examine the collegeenrollment decisions of individuals in the US using the CurrentPopulation Survey and find that their propensity to enroll iscountercyclical. There seems to be significant substitutionduring the business cycle between human capital investment andcompeting economic activities.     

Trade exposure and electoral protectionism: evidence from Japanese politician-level data

Review of World Economics - This study empirically examines the causal impact of economic shocks of trade on trade policy positions by candidates who run for national elections using...     

Permanent land-use rights and endowment insurance: Chinese evidence of the substitution effect

This paper studies the substitution effect of permanent land-use rights on endowment insurance in China. We first explain the rationality using an overlapping-generations model with heterogeneous households possessing land-use rights or not, and find that economic agents profiting from land in the latter stage of their life tend to save less for retirement than their land-deprived counterparts. Empirical evidence from village-clustered Chinese survey data on rural households supports this finding, locating a significant negative effect of land on social and commercial endowment insurance purchase. Apart from the important policy implication of compensating land-deprived farmers with insurance, our theoretical and empirical models both yield unexpected informing findings.     

Trade openness and air pollution: City-level empirical evidence from China

We seek to contribute to the debate over trade openness and the environment by taking specific account of the endogeneity of trade openness. We use exogenous geographic determinants of trade as instrumental variables as well as distance to Huai River for identification which is based on China's heating policy. Using air quality measure from NASA, we find that trade increases three measures of air pollution: SO₂, NO₂, and Aerosol concentration.