Smuggling around the world: evidence from a structural equation model

This article uses a Multiple Indicators Multiple Causes (MIMIC) model to analyse the determinants of smuggling. The analysis reveals that higher corruption and a lower rule of law encourage smuggling. Tariffs and trade restrictions are important push factors, while a higher Black Market Premium (BMP) discourages smugglers. Based on the MIMIC estimates, we calculate an index of smuggling which provides a ranking for 54 countries. We find that smuggling is rampant in Cameroon, Pakistan and Kenya while it is least prevalent in Switzerland, Finland and Sweden.     

Corruption,illegal trade and compliance with the Montreal Protocol

This paper studies the effects of corruption, rule of law and tariffs on illegal trade in chlorofluorocarbons (CFCs) controlled by the Montreal Protocol. Since data on illegal trade is not available, it is not possible to test any theoretical conclusions about smuggling. The paper, however, attempts to circumvent the problem by developing a model of illegal trade in CFCs that derives predictions about the effects of corruption, rule of law and tariffs on both legal and illegal imports of CFCs. Then the theoretical predictions concerning legal imports are tested using panel data on CFC consumption. Using the estimates of legal imports, inferences about illegal trade are made. The basic findings indicate that knowledge about the degree of rule of law, corruption and the level of tariffs is needed for the correct interpretation of the data on environmental performance reported to international monitoring agencies.     

Smuggling and Bhagwati's Nonequivalence Between Tariffs and Quotas

The authors extend Professor Bhagwati's analysis about the nonequivalence between trade policy instruments when domestic production is monopolized and the terms of trade are endogenous, by allowing for smuggling. They show that the dominance of the ad valorem tariff over the quota is not robust. Tariffication can lower welfare even when the level of illegal imports is quite small. However, tariffication with a specific tariff is always beneficial because the specific tariff dominates the ad valorem tariff and the quota with or without smuggling. Smuggling (or the threat) also tends to lower the second–best tariff/quota, and increases welfare when imports are restricted by a quota, but lowers it under a tariff.     

Smuggling, non‐fundamental uncertainty, and parallel market exchange rate volatility

Abstract.  We explore a model where smuggling and a parallel currency market arise, owing to government restrictions that prevent agents from legally holding foreign exchange. Despite such restrictions, agents are able to diversify their savings, holding both domestic and parallel foreign cash, basing their portfolio allocation on current and prospective parallel exchange rates. We attribute movements in parallel rates to non‐fundamental uncertainty. The model generates equilibria with both positive and negative parallel premia and correlations between illegal trade and the premium. The model has the novel implication that currency speculation drives smuggling, affecting real activities in all sectors of the economy. JEL classification: F31     

Political Commodities and Sovereignty Management: Cigarette Smuggling across Brazil’s Southern Borders

Cigarette smuggling across Brazil’s borders with Paraguay, Uruguay and Argentina involves large amounts of merchandise and money. The public in Brazil associates this activity with images of war, contamination and other threats to state sovereignty. This article assesses the political meaning and uses of smuggling in order to challenge the assumption that smuggling threatens the sovereignty of the Brazilian state. With the help of a literature review, fieldwork at the border, interviews with practitioners, a cartographic analysis of news coverage of seizures, the tobacco production and consumption, the market and its regulation, actors, routes and networks were mapped and analysed. In the Southern Cone of South America, an integrated transborder territory emerges where tobacco is cultivated, prepared and distributed, and cigarettes are manufactured, transported, sold and smoked. These flows cross distinct legal framings and lead to an increase in danger and profit. Thus, the market is segmented between national legal products and imported cigarettes that are cheaper and illegal but easily obtainable. The concepts of political commodities understood as the acts of powerful agents who barter advantages related to their authority and sovereignty management, understood as the use of legal (state-managed) structures according to private interests at different scale levels, provide useful theoretical tools to examine the territorialisation of the cigarette smuggling and its control by the state and private agents. We conclude that tobacco production and trade, as well as cigarette smuggling, are connected via agents who use the border to build the legal market and, consequently, to increase the trade value of national tobacco. Cigarette smuggling across the state borders of the Southern Cone combines networks and places in such a way that is integrated into the legal economy and the national territories, and it does not defy state’s sovereignty.     

Exports to Smuggle and Smuggling Technologies*

Our analysis is motivated by cases of cigarette smuggling in Canada and in the UK. In the 1990s, domestic cigarettes were legally exported to be subsequently illegally imported. At first, smuggling was done by individual consumers who bought cigarettes abroad and brought them back through policed points of entry. This Mom and Pop smuggling was a mechanism to implement a second‐degree price discrimination scheme by cigarette manufacturers. Regrets from committing tax evasion and labels on exported cigarettes packs permit vertical differentiation of illegal and legal cigarettes. Paradoxically, labeling measures can make illegal sales more resilient to tax reductions, and stricter border enforcement encourages a switch to a less benign smuggling technology exclusive to criminal organizations. High export taxes terminated export‐to‐smuggle schemes, but brought about a surge of counterfeit cigarettes. Because of a second‐degree price discrimination scheme, the elimination of taxes need not suffice to eradicate smuggling.     

A Model of Smuggling and Trafficking of Illegal Immigrants with a Host Country Policy

This paper deals with illegal immigration via two distinct activities—smuggling and trafficking of workers. A destination–source model determines economic pay‐offs and a standard labor market policy works as a deterrent. Tax paid by legal unskilled workers at the destination is determined endogenously and it finances inland monitoring against illegal immigration, holding the border patrol at a given level. The tax also finances unemployment benefit to legal workers at the destination. The number of immigrant smugglers and traffickers is also determined endogenously along with employer penalty and market wage for illegal immigrants. Higher unemployment benefits may reduce illegal wages, raise traffickers’ rent and reduce flow of illegal immigrants from the source countries.     

Effects of enforcement on illegal markets: Evidence from migrant smuggling along the southwestern border

The paper analyzes the effects of tighter border control on the illegal crossing market between Mexico and the United States. Combining panel data on illegal migrants with enforcement statistics, the effects of enforcement are found to be moderate: prices of border smugglers (‘coyotes’) increased by only 17%, while the demand for smugglers has remained unchanged. Enforcement has however shifted illegal migrants to remote crossing places. Border crossing is now more time-intensive with higher prices for coyotes and risk of death. This geographic substitution raised migration costs by $140, more than twice the effect of enforcement on smuggling prices.     

Preferential trade and mis-invoicing: Some analytical implications

This paper examines how different trade policies affect illegal trade practices, foreign exchange market and the degree of illegal capital outflow. It builds up a three-country preferential–non-preferential trade model where low or zero tariff prevails in the preferential trade channel and higher tariff is exercised in the non-preferential trade channel. We show that initially the preferential trade channel is likely to encourage illegal capital outflow and non-preferential trade channel is conducive for illegal transactions in foreign exchange in the local market. But finally a low tariff regime takes care of both illegal capital outflow and black market for foreign exchange.     

Peace parks: The paradox of globalisation1

Concern for environmental protection within an increasingly ‘globalised’ international system has led in many parts of the world to plans for transfrontier conservation areas, commonly known as ‘Peace Parks’. These offer the prospect of providing integrated management for bioregions that have been divided by state frontiers, and reopening animal migration routes. They also promise increased tourist revenues since visitors, too, would be free to benefit from the enhanced transnational space that the parks provide. This paper examines plans for such parks in two regions, Southern Africa and Central America. In practice, these plans have been undermined by the existing uses of transnational space for informal (and often criminal) transfers that themselves benefit from the permeability of frontiers in areas that are weakly controlled by state authorities; these include smuggling, poaching, illegal immigration and the trade in narcotics. Such activities, which likewise derive from ‘globalisation’, generate powerful political interests, both among local communities and more widely. Paradoxically, the creation of Peace Parks requires more, and not less, state control of frontier zones, and raises significant issues for the management or control of globalising forces in weakly administered regions of the developing world.     

公安机关对缴获易制毒化学品的绿色处置

当前,随着国际毒情的变化,合成毒品的种类越来越多,易制毒化学品的非法走私情况也越来越严重。公安机关禁毒部门每年都缴获大量的易制毒化学品,对缴获的易制毒化学品实行无害化处理,是公安机关禁毒部门当前面临的最棘手的问题。文章对当前公安机关禁毒部门缴获及处置易制毒化学品的现状进行介绍,分析了公安机关禁毒部门对易制毒化学品处置不当存在的生态环境的隐患,提出公安机关对缴获易制毒化学品绿色处置的建议。     

从鄂君启金节看战国持节贸易

持节贸易是战国时期一种重要的贸易管理制度,是现代对外贸易许可证形式的雏形.它不仅是中国战国时期国家管理经济职能的外在形式和国家税收的重要来源,而且是稽查走私,保护特定产业的重要手段.为中国现代较为完善的对外贸易管理制度提供了源渊和基础.     

Performance,Representation and the Economics of Border Control in Uzbekistan

This article explores the contradictions and intersections between the performative and economic aspects of state boundary control. From 1999 onwards, Uzbekistan's formal trade with its neighbours declined dramatically, whilst cross-border smuggling mushroomed. This article examines these developments, using both an economic analysis, and a theoretical approach to the study of international boundaries derived from political geography, anthropology and ‘borders theory’. Methodologically, it employs trade-flow analysis, discourse study and ethnography to construct an account of how an apparently economically counterproductive policy has symbolic and performative value to the state. The changes in trade patterns were largely due to the unilateral introduction of a new and highly disruptive border and customs control policy, which dramatically increased transportation costs, precipitating a growth in smuggling in which some state officials themselves colluded. Economically, whilst this policy would thus appear harmful to the state, the article suggests that border control policies also had a theatrical function related to the performance of national identity and the perpetuation of the incumbent regime. It concludes with policy recommendations addressed to both Central Asian states and international donors.     

国际经济法中一个值得研究的问题——信用证欺诈的含义和种类

随着我国对外贸易的发展，信用证作为最常见的结算支付方式，在我国对外经济贸易中的作用日益重要。但是由于信用证独特的机制，在给国际贸易带来便利的同时，也给不法之徒留下了可乘之机，越来越多的不法商人利用这一机制进行信用证欺诈，给贸易当事人带来巨大的危害。本文着重阐述了信用证欺诈的含义及信用证欺诈的种类表现形式，从而提高防范意识，避免在国际贸易活动中遭到欺诈而承受重大损失。     

ILLEGAL MIGRANTS, TOURISM AND WELFARE: A TRADE THEORETIC APPROACH

Abstract.  Many countries receive illegal migrants but are reluctant to accept them due to possible negative externalities. We provide a rationale for not policing illegal migration by linking it to the tourism industry. By paying illegal migrants less than local workers, the relative price of the non-traded goods is shown to be lower than it would be in the absence of such workers. An expansion in tourist trade, under certain intensity conditions, necessarily raises resident welfare and employment. This tourist boom necessarily lowers the welfare of the illegal migrants. It is established that an increase in tourism increases the supply of illegal migrants.     

Migrant smuggling

We analyze a model of the migrant smuggling market where smugglers differ in the capacity to exploit their clients' labor at the destination. We suggest that destination countries with limited resources may prefer to improve the apprehension of smugglers and their clients at the border rather than inland, although either one of these anti-smuggling measures would reduce migrant exploitation. The reason is twofold. First, even if the resulting improvement in border apprehension alone cannot eliminate smuggling, it can do so when combined with a severe penalty for smuggling. Second, even if it is impracticable to set the penalty for smuggling sufficiently high, improved border apprehension reduces smuggling by discouraging existing exploitative smugglers from smuggling, whereas improved inland apprehension either maintains or even increases it by inducing them and those who are not currently smuggling to take up nonexploitative smuggling.     

Illegal immigration: a supply side analysis

"This paper analyzes the supply-side determinants of illegal immigration using a three-sector general equilibrium model of the source country. Agricultural liberalization raises illegal immigration while liberalization of the high tech sector reduces it. In contrast, capital mobility in the source country renders trade policy ineffective for controlling illegal immigration. Paradoxically, increased enforcement (by the host country) may raise source country unskilled wages, although illegal immigration falls. Finally, under capital mobility, a rise in the source country restrictions on capital inflow raises the level of illegal immigration and reduces the effectiveness of border enforcement efforts by the host country."     

尹朗局势的发展及中国对策

当前伊朗的紧张局势左右着国际原油价格的走势，并呈现剧烈震荡的格局。美国以怀疑伊朗试图发展核武器为由，不断对伊朗进行制裁，其真实目的是控制石油资源且石油必须以美元结算。俄罗斯是伊朗在中东地区的传统贸易伙伴，为了维护自己的利益，围绕“石油美元”这一焦点问题与美国产生了激烈的竞争和错综复杂的关系。中国作为一个爱好和平的国家应积极寻找各种对策以稳定伊朗局势。     

EFFICIENT POLICY IN A PREDATORY ECONOMY: TO HIM WHO HATH SHALL BE GIVEN?*

Trade subject to predation generates externalities within and between markets. Efficient tax, infrastructure, and enforcement policies internalize the net externality—more trade implies fewer predators but drawn to trade at rising cost. The balance is positive (negative) as enforcement is weak (strong). Dual economies pair weak Periphery and strong Core enforcement markets. Efficient taxation and infrastructure promote the Core at the expense of the Periphery. Efficient enforcement promotes both. Tolerance (intolerance) of smuggling is efficient when Core enforcement is weak (strong). Tolerance of informal market Mafias that provide enforcement and infrastructure is efficient when Core enforcement is strong.     

The case against eliminating large denomination bills

When large denomination bills are preferred in illegal activities, what is the optimal policy response? We construct a dual currency model where illegal activity can be reduced by modifying the payment environment. In our model, legal (goods) traders are indifferent between small and large bills, but illegal (goods) traders face a lower transaction cost of using large bills in comparison to small bills because it is easier to conceal. We show that eliminating large bills can reduce illegal trade and its associated social cost. However, this pooling equilibrium is sub-optimal because the government can collect more seigniorage by allowing illegal traders to use large bills with a lower rate of return. When the transaction cost of using small bills for illegal traders is sufficiently large, a separating equilibrium, where legal traders use small bills and illegal traders use large bills, can maximize welfare by making an implicit transfer from the illegal traders to the legal traders.