Does Aid for Trade Enhance Export Performance? Investigating the Infrastructure Channel

There are few empirical studies assessing the effectiveness of aid for trade as regards trade performance. Furthermore, existing work does not test which are the channels through which aid for trade has an impact on trade performance. We address this question using a two‐step empirical analysis. Relying on an export performance model, we first test whether institutions and infrastructure, our two potential channels of transmission, are significant determinants of export performance. Second, we test the impact of aid for trade sectoral flows on the previously detected determinants of export performance. We show, as part of the first step, that the infrastructure channel is a highly significant determinant of export performance, whereas the institutional channel turns out to have a limited positive impact on developing countries’ export performance. Furthermore, we show, from the second step, that aid for infrastructure, once instrumented, has a strong and positive impact on the infrastructure level. As a result, we find that a ten per cent increase in aid for infrastructure commitments per capita in developing countries leads to an average 2.34 per cent increase in the exports over GDP ratio. It is also equivalent to a 2.71 per cent reduction in tariff and nontariff barriers. These results highlight the high potential impact of aid for trade on developing countries’ export performance throughout the infrastructure channel.     

Labour,nature, and exploitation: Social metabolism and inequality in a farming community in mid‐19th century Catalonia

Exploiting the labour of other people has historically been one of the main strategies to tackle the biophysical tension that always exists between the satisfaction of human needs and the labour required to fulfil them. Based on the insights of ecological, feminist, and Marxist economics, we disentangle the exploitation of the labour of women and labouring poor through a novel methodology that integrates energy, material, time, and cash balances. We apply it to the sociometabolic flows between household units endowed with different land and livestock resources in a traditional rural community in Catalonia (Spain) in the mid‐19th century. The results show that land and livestock hoarding led to a process of accumulation through dispossession that increased the exploitative relationships through the labour market, which in turn relied on the patriarchal division of labour between men and women at home. Our estimates of energy labour surplus reveal that male wages represented 88% of the equivalent consumption basket that would have been obtained by carrying out the same amount of labour on land of one's own. However, in the case of female wages, the percentage was 54%. This shows that wage labour incorporated a significant amount of unpaid domestic family labour.     

Firm Size and Job Quality: A Survey of the Evidence from Germany?

Small Business Economics - Small firms provide and create a large proportion of jobs in Germany. Are these jobs worse than jobs in larger firms? The mosaic picture that emerges from a review of...     

Representing Heterogeneity in Consumer Response Models 1996 Choice Conference Participants

We define sources of heterogeneity in consumer utility functions relatedto individual differences in response tendencies, drivers of utility, formof the consumer utility function, perceptions of attributes, statedependencies, and stochasticity. A variety of alternative modelingapproaches are reviewed that accommodate subsets of these various sourcesincluding clusterwise regression, latent structure models, compounddistributions, random coefficients models, etc. We conclude by defining anumber of promising research areas in this field.     

Exports and success in German manufacturing

Exports and Success in German Manufacturing. - While Germany has a very open, export-oriented manufacturing sector, there has been little research on the role of exporting in German firms’ performance. This paper documents the significant differences between exporters and non-exporters and attempts to identify the sources of these disparities. Exporters are much larger, more capital-intensive, and more productive than non-exporters. However, the bulk of the evidence suggests that these performance characteristics predate the entry into export markets. The authors find no positive effects on employment, wage or productivity growth after entry. The authors’ results provide evidence that success leads to exporting rather than the reverse.     

Overall trade specialization and economic development: countries diversify

This paper provides evidence for an aspect of trade often disregarded in international trade research: countries’ sectoral export diversification. The results of our semiparametric empirical analysis show that, on average, countries do not specialize; on the contrary, they diversify. Our results are robust for different statistical indices used to measure trade specialization, for the level of sectoral aggregation, and for the level of smoothing in the nonparametric term associated with per capita income. Using a generalized additive model (GAM) with country-specific fixed effects it can be shown that, controlling for countries’ heterogeneity, sectoral export diversification increases with income.

Why Speed Doesn’t Kill: Learning to Believe in Disinflation

Central bankers generally prefer to reduce inflation gradually. We show that a central bank may try to convince the private sector of its commitment to price stability by choosing to reduce inflation quickly. We call this “teaching by doing”. We find that allowing for teaching by doing effects always speeds up the disinflation and leads to lower inflation persistence. So, we clarify why “speed” in the disinflation process does not necessarily “kill” in the sense of creating large output losses.     

Higher productivity in importing German manufacturing firms: self-selection, learning from importing, or both?

This paper uses a newly available comprehensive panel data set for manufacturing enterprises from 2001 to 2005 to document the first empirical results on the relationship between imports and productivity for Germany, a leading actor on the world market for goods. Furthermore, for the first time the direction of causality in this relationship is investigated systematically by testing for self-selection of more productive firms into importing, and for productivity-enhancing effects of imports (‘learning-by-importing’). We find a positive link between importing and productivity. From an empirical model with fixed enterprise effects that controls for firm size, industry, and unobservable firm heterogeneity we see that the premia for trading internationally are about the same in West and East Germany. Compared to firms that do not trade at all two-way traders do have the highest premia, followed by firms that only export, while firms that only import have the smallest estimated premia. We find evidence for a positive impact of productivity on importing, pointing to self-selection of more productive enterprises into imports, but no clear evidence for the effect of importing on productivity due to learning-by-importing.     

Firm size,firm growth,and persistence of chance: Testing GIBRAT's law with establishment data from Lower Saxony, 1978–1989

Using data for some 7000 manufacturing establishments from Lower Saxony for 1978–1989 we tested for the validity of GIBRAT's Law of Proportionate Growth. We found that the law is only valid for very few groups of firms in some of the periods covered. However, we did not find that small firms grew systematically faster or slower than larger firms, or vice versa. On the other hand, we found persistence of chance in the sense that a firm grows faster if it happened to grow faster in the past, too.This paper is part of the research project Production, Employment Growth, and Exports by Lower Saxonian Firms. The computations based on the establishment level data from the official surveys of the manufacturing sector were made possible by a special arrangement between the Ministry of Economics, the Statistical Office, and the Labour Research Group at the Department of Economics, Hannover University. I am grateful to Uwe Rode for preparing the data base, to Wihelm Lorenz for writing a program that makes it possible to use these large data set on a PC, and to an unknown referee for helpful comments on an earlier version of this paper.     

Investor sentiment and feedback trading: Evidence from the exchange-traded fund markets

This paper extends the standard feedback trading model of Sentana and Wadhwani (1992) by allowing the demand for shares by feedback traders to depend on sentiment. Our empirical analysis of three largest Exchange-Traded Fund (ETF) contracts in the U.S. suggests that there is a significant positive feedback trading in these markets and the intensity of which is generally linked to investor sentiment. Specifically, the level of feedback trading tends to increase when investors are optimistic. In addition, we find that the influence of sentiment on feedback trading varies across market regimes. These results are consistent with the view that feedback trading activity is largely caused by the presence of sentiment-driven noise trading. Overall, the findings are important in understanding the role of sentiment in investment behaviour and market dynamics and are of direct relevance to the regulators and investors in ETF markets.