Korea's liberalization policy directives and Korea's weakening competitiveness

Recently, Korea's export growth rate is decreasing and its trade level staggering. Since Korea has few natural resources and is highly dependent on trade, this recent trend signals a serious problem lying ahead. In this paper, we look at internal and external factors weakening Korea's competitiveness in the world market and suggest liberalization policy guidelines to improve its competitiveness.     

An empirical assessment of the preconditions of Japanese manufacturing foreign direct investment in the United States

An Empirical Assessment of the Preconditions of Japanese Manufacturing Foreign Direct Investment in the United States. — This study undertook a multivariate regression analysis of Japanese foreign direct investment in the US (FDIUS), based on firm- and industry-specific data. Firm size was a positive and significant explanatory variable of firms’ completed transactions as well as their additions to investment value. Firms’ overall profit was a positive and significant indicator of firms’ addition to investment value, but not their completed transactions. Firms’ return on assets was generally a positive, albeit insignificant indicator of FDIUS. Three industry-specific variables (prior exports to the US, industry concentration, and technological intensity) were examined and all were positive but insignificant indicators of FDIUS.     

Maximum likelihood cointegration tests of purchasing power parity: Evidence from seventeen OECD countries

Maximum Likelihood Cointegration Tests of Purchasing Power Parity: Evidence from Seventeen OECD Countries. — This paper examines the relevance of long-run purchasing power parity (PPP) during the recent floating exchange rate period, using Johansen’s maximum likelihood method for estimating and testing steady-state relations in multivariate vector autoregressive models. Thirty-two bilateral intercountry relations are considered and it is found that in many cases there exists a long-run relationship between exchange rates and international price differentials, which, however, significantly deviates from PPP in most instances.     

The assessment: knowledge, skills, and competitiveness

The autumn 1988 issue of the Oxford Review of Economic Policyconsidered the UK's deficiencies in vocational education andtraining (VET). It was there that Finegold and Soskice firstpopularized the notion of the 'low skills/low quality' equilibrium.This Assessment introduces a range of articles which discussdevelopments in the decade that has passed since then. It arguesthat, despite massive policy initiatives, there has been onlylimited improvement in the UK's relative VET performance. Considerableprogress has been made in analysis of market failures affectingthe supply of skills, and in analysis of the possible causesand consequences of low employer demand for skills (systemsfailure). The recent Competitiveness White Paper reflects thisimproved understanding. However, there is still an imperfectappreciation of the nature of skills and of their contributionto the development of a more competitive, higher value-addedeconomy. The article ends by suggesting how progress might bemade on this front.     

Globalization and wage inequalities: A synthesis of three theories

Globalization and Wage Inequalities: A Synthesis of Three Theories. — The theoretical insights of Heckscher and Ohlin, Feenstra and Hanson, and Tang and Wood provide a plausible explanation of the effects of globalization on wage inequalities in developed and developing countries. In combination, these three theories can explain, among other things, why inequality has fallen in some developing countries but risen in others. Improved travel and communications facilities raise the relative wages of highly skilled Northern workers, but in both the North and the South have mixed effects on wage gaps between medium-skilled and unskilled workers, sometimes reinforcing and sometimes offsetting the effects of falling barriers to trade.     

An empirical assessment of the effects of trade in innovative tasks on innovation output

Multinational firms are increasingly sending their innovative tasks abroad. This article examines whether offshoring research and development, design, and engineering activities provides any gains in terms of firm‐level innovation output. The effects of trade in innovative tasks on the probability of firms being innovative and the share of innovative product sales in total turnover are examined using an instrumental variable approach. The data in use come from a recent survey, which provides cross‐section observations for more than 14,750 firms in seven European countries. The results suggest that those firms that offshore their innovative activities are 60% more likely to successfully innovate. Also, offshoring innovative activities increases the share of innovative product sales in total turnover up to 35%. Furthermore, firms in this sample appear to gain from trade in innovative tasks when such trade is in product innovation but not when such trade is in process innovation.     

Explaining price level differences: New evidence on the Balassa–Samuelson effect

We re‐examine one of the most venerable results in economics, the Balassa–Samuelson effect of Balassa (1964) and Samuelson (1964). The central claim of Balassa–Samuelson is that nontradables explain price level differences across rich and poor economies. We test Balassa‐Samuelson by quantifying the contribution of nontradables to cross‐sectional price level variation for countries in the International Comparison Program (ICP). Our results suggest that nontradables explain up to two thirds of price level variation.     

Remittance,Institutions and Investment Volatility Interactions: An Intercontinental Analysis

Generating massive investment for growth and development has been one of the main policy goals of most economies around the globe. Countries, most especially developing ones, are highly susceptible to investment volatility owing largely to the fragile nature of their economies as well as weaknesses in terms of dysfunctional institutions. Therefore, sound economic management suggests the need to better understand possible sources for mitigating the adverse effects of investment volatility. Remittances have been identified as important capital flows which do a good job of dousing macroeconomic volatilities. It is on this basis that the study sought to uncover the causal relationship between remittances and investment volatility via the intermediating role of institutions. Using a panel of 70 countries and the system Generalized Method of Moments (GMM) estimator, three insightful outcomes come to the fore. First, remittances played countercyclical roles across the estimated regressions. Second, institutional quality had no significant role in mitigating investment volatility and lastly, the interactive terms of both remittances and institutions significantly mitigated the negative impacts of investment volatility with the exception of the political component of the institutional architecture. Policy suggestions are drawn based on our results.     

The Dollar-Mark axis

The Dollar-Mark Axis. — Over the last two decades, most European currencies have tended to weaken against the mark as the latter strengthened against the dollar. Moreover, the strength of the response of European cross rates has tended to remain in the same order over time. The paper first sets out the stylised facts of this phenomenon, referred to as the dollar-mark axis, and then tries to identify its determinants. In addition to exchange rate policy, the paper examines the correlation of cyclical fluctuations and trade links and the bias of international investors in the currency composition of their portfolios.     

The effects of Europe’s internal market program on production and trade: A first assessment

The Effects of Europe’s Internal Market Program on Production and Trade: A First Assessment. — The paper analyzes the extent of structural changes that have occurred inside the EC since the launching of the internal market program. The first part of the paper examines intersectoral shifts in the pattern of specialization within EC manufacturing and finds relatively little change from 1986 to 1992. The second analyzes the trade impact of the internal market program, and finds that internal and external trade creation have both prevailed. The third uses regression analysis to explain the share of intra-EC imports in total EC imports in 1986 and in 1992, and identifies the impact of the internal market program.     

Developments in the Political Economy of Policy Coordination

Issues of macroeconomic and exchange rate policy coordination have cycled in and out of the forefront of international policy discussions a number of times over the last several decades, yet little systematic progress has been made in institutionalizing this process and both the potential benefits and costs of cordination strategies remain highly controversial. This essay reviews the recent technical and political economy literature on this subject, highlighting the major areas of consesus and disagreement. It emphasizes the importance of taking uncertainty and political economy considerations into account.     

DO AFRICAN COUNTRIES MOVE ASYMMETRICALLY TOWARDS PURCHASING POWER PARITY?

This paper investigates the possibility that the adjustment towards long‐run relative purchasing power parity (PPP) is dependent upon the nature of deviations from PPP that are experienced. While existing studies involving developed and less developed countries often find against PPP having employed linear tests of non‐stationarity or non‐cointegration, we employ a new cointegration test, recently advocated by Enders and Siklos and Enders and Dibooglu, that tests for an asymmetric adjustment towards parity with respect to positive and negative deviations of the real exchange rate from its equilibrium value. Using a sample often African economies with data taken from the post‐Bretton Woods floating exchange rate era, long‐run PPP holds in eight of these cases if an explicit distinction is made between positive and negative deviations. Across the sample, we find variation in the type of asymmetry experienced and the roles played by price and nominal exchange rate adjustment.     

供给侧改革视角下大学生就业竞争力提升对策研究

高等教育的规模不断扩大、大学生毕业人数越来越多,但是就业市场与人才培养的结构性矛盾突出,出现大学生就业难,企业却招不到人的困境。从大学生就业市场供给与需求这一内在逻辑出发论证了供给侧改革对于解决大学生就业问题的适切性,认为高校的供给质量和水平与大学生就业情况息息相关。然后以供给侧改革为视角分析了大学生就业问题的集中表现,问题主要在于高校层次、专业结构、人才素质与就业市场要求的失衡。最后从高校这一供给主体出发,认为高校需要找准自身发展定位,优化专业结构、提高人才供给质量,从而提高大学生就业竞争能力,实现人力资源要素配置的最优化。     

Deviations from long-run equilibria and probabilities of devaluations: An empirical analysis of Danish realignments

Deviations from Long-Run Equilibria and Probabilities of Devaluations — An Empirical Analysis of Danish Realignments. — The probabilities of realignments between the Danish krone and the D-mark are investigated for the 1979–1995 period. Two multivariate systems are estimated. In the I (1) systems, the deviations from the cointegration relations are used as explanatory variables when determining the probabilities of exchange rate changes. It is found that real imbalances in the economy have to a large extent determined the probabilities of central parity changes. Furthermore, the probabilities of central parity changes have been significantly lower after 1983.     

Does North-South horizontal intra-industry trade really exist? An analysis of the toy industry

Does North-South Horizontal Intra-Industry Trade Really Exist? An Analysis of the Toy Industry. — In a combination of a case study approach and econometric analysis, bilateral intra-industry trade between high income countries and low income countries in the toy industry is investigated. In a number of products there is important bilateral intra-industry trade between both groups of countries. Econometric analysis in which a number of the explanatory variables used were quantified on the basis of the information supplied by the industry-spokesmen yields results which strongly support the view that the bilateral IIT between the high income countries and the low income countries in the toy industry is determined significantly by horizontal product differentiation and economies of scale.     

An empirical test of the Dixit-Norman approach to factor price equalization, using cointegration techniques

An Empirical Test of the Dixit-Norman Approach to Factor Price Equalization, Using Cointegration Techniques. — Factor price equalization (FPE) occurs when international trade equilibrium reproduces the integrated world equilibrium (IWE). This allows a straightforward test of a necessary condition for FPE provided one has an idea of the IWE. The author considers Germany as such for France, Belgium and the Netherlands. Cointegration estimation techniques are preferred to SURE, because of endogenity and nonstationarity of the variables. Using the coefficient restrictions, estimation is performed with French and Belgian factor endowments and German sector allocations. Finally, FPE is checked by testing appropriate coefficient restrictions. Concluding, the author finds no long-term trade equilibrium with FPE for the countries considered.     

Trade Agreements and Economic Growth

This article studies the growth effects of regional trade agreements (RTAs), taking into account the World Trade Organization (WTO) participation of RTA members. Assuming smaller preference margins of RTAs for WTO members than for nonmembers, I show in a model a stronger growth effect of RTAs for non‐WTO members than the effect for WTO members. Based on a comprehensive set of 270 RTAs and a large panel data set over the period of 1960–2007, the regression results show that RTAs promote growth for non‐WTO members, while their growth effect is weaker and often insignificantly different from zero for WTO members. This implies that, so far, the complementarity between the two approaches of trade liberalization in promoting economic growth is limited.     

Trade and growth: A gravity approach

The impact of international trade, or “openness,” on economic growth is difficult to quantify because of reverse causality. In this article, I use recent advances in gravity equation estimation to generate a geography‐based instrument for openness à la Frankel and Romer (1999). In contrast with the benchmark, the new instrument is constructed using consistent and unbiased estimates of the impact of geography on bilateral trade. As a result, the instrument provides stronger identification of the impact of trade on income and increases the efficiency of the two‐stage least square estimation. An important advantage of the corrected procedure over the benchmark is that the estimated effect of trade on income remains large, positive, and statistically significant even after controlling for regional indicators and endogenous institutional quality.     

中国纺织服装业国际竞争力的实证研究

本文应用多因素法、进出口数据法和利润率法,从要素竞争力、市场竞争力和可持续竞争力三个层面对中国纺织服装业的国际竞争力进行实证分析。结果表明,纺织原料、劳动力成本和产业链等竞争优势要素,决定了中国纺织服装业具备强大的市场竞争力;同时,技术和品牌等竞争劣势要素,使得中国纺织服装业的可持续竞争力不强。