Social and Behavioral Sciences Commons^™

Current Account “Core-Periphery Dualism” In The Emu, Tatiana Cesaroni, Roberta De Santis

Roberta De Santis

Current account (CA) dispersion within European Union (EU) member states has been increasing progressively since the 1990s. Interestingly, the persistent deficits in many peripheral countries have not been accompanied by a significant growth process able to stimulate a log run rebalancing as neoclassical theory predicts. To shed light on the issue this paper investigates the determinants of Eurozone CA imbalances, focusing on the role played by financial integration. The analysis considers two samples of 22 OECD and 15 EU countries, three time horizons corresponding to various steps in European integration, different control variables and several panel econometric methods. The results …

Is The Wto Quietly Fading Away?: The New Regionalism And Global Trade Rules, Stephen J. Powell, Trisha Low

Stephen Joseph Powell

While scholars and governments alike view the liberalization of international trade as a positive development, they disagree on the medium that will accomplish this objective with the highest economic returns. Some experts believe that multilateralism through the 150+ member World Trade Organization (WTO) is the only way to achieve truly open and efficient trade. Others view multilateralism as but an aspiration and find that regionalism offers the only viable prospect for the meaningful further opening of markets. In light of what we label the "new regionalism," our paper explores in detail the positive and negative effects of regional trade arrangements …

Perspectives On The Global Financial Crisis From Emerging Managers And Public Policy Makers [Full Version], James L. Grant

James L. Grant

This manuscript attempts to capture the perspectives of emerging managers and public policy makers as evinced in the perspectives of graduate students and others who were enrolled in my newly developed course on the global financial crisis—first offered in the 2010 Harvard Summer Economics Program—at a time when students were engaged in the midst and aftermath of the most severe U.S. and worldwide recession since the Great Depression of the early 1930s. The many perspectives gathered on the causes, consequences, remedies, and perhaps more importantly, a glimpse at student thoughts, concerns, and worries at the time—have been collected from the …

Eu-China Economic Relations: Interactions And Barriers, Zheng Lu

Zheng Lu (Chinese: 路征)

EU-China economic interactions became more and more frequent in the past decades, nowadays EU and China are main trade partner for each other. This paper analyzed EU-China economic interactions from three dimensions: bilateral governmental interactions, trade and investment flows as well as barriers to trade and investment. Findings show that EU-China close relationship is particularly based on goods trade especially on intra-industrial trade of manufacturing industrial products, and trade imbalance is arising from trade in Machinery and Transport Equipment and Other Manufactured Goods (e.g., Clothing and clothing accessories); This paper also found that there exist a myriad of trade and …

Network Analysis Of World Trade Using The Baci-Cepii Dataset, Luca De Benedictis, Silvia Nenci, Gianluca Santoni, Lucia Tajoli, Claudio Vicarelli

Luca De Benedictis

In this paper we explore the BACI-CEPII database using Network Analysis. Starting from the visualization of the World Trade Network, we then define and describe the topology of the network, both in its binary version and in its weighted version, calculating and discussing some of the commonly used network’s statistics. We finally discuss some specific topic that can be studied using Network Analysis and International Trade data, both at the aggregated and sectoral level. The analysis is done using multiple software (Stata, R, and Pajek). The scripts to replicate part of the analysis are included in the appendix, and can …

Women’S Empowerment And Community-Driven Development: Evidence From The Solomon Islands, Erin M. Steffen

Erin M Steffen

The study evaluates the impact to-date of a community-driven development (CDD) program on women’s empowerment in the Solomon Islands. Originally launched in 2008, the CDD program is known as the Rural Development Program (RDP). The RDP aims to foster employment and income growth by focusing on participatory development, demand-responsive provisions of government services, and the creation of a supportive economic environment for small-scale rural development. The RDP process mandates female involvement, which manifests predominately in the selection of community infrastructure projects and by participation in a RDP subcommittee known as the Sub-Implementation Committee (SIC). Members of the SIC are in …

Assessing The Price-Raising Effect Of Non-Tariff Measures In Africa, Olivier Cadot, Julien Gourdon

Julien Gourdon

In spite of widespread tariff reductions, intra-African borders remain ‘thick’. Regional trade is inhibited by inadequate transportation infrastructure but also by various non-tariff measures (NTMs). This paper combines price data from the World Bank’s International Comparison Project with a new database on NTMs to estimate their effect on consumer prices for selected consumption products. Results based on panel regressions on 1,260 country-product pairs suggest that, after controlling for tariffs, systematic cross-country cost-of-living differences, and product-specific unobservables, sanitary and phytosanitary measures contribute to raise the price of African foodstuffs by 14%. At the product level, rice and other cereals, some types …

Subsidizing Non-Polluting Goods Vs. Taxing Polluting Goods For Pollution Reduction, Robert S. Main

Robert S. Main

Pigovian taxes on polluters are politically unpopular, but subsidies for non-polluting sources are politically attractive. This paper presents a linear demand and supply model and numerical example to explore the trade-offs between taxing polluting sources of a good versus subsidizing non-polluting sources of the same good. While the model (along with the associated numerical example) shows the optimality of Pigovian taxes, it also shows how much welfare is reduced if subsidies for nonpolluters are employed instead. Further, it shows the optimal tax, given any level of subsidy and the optimal subsidy, given any level of tax.

The Relationship Between Import Penetration And Operation Of The U.S. Textile And Apparel Industries From 2002 To 2008, Sheng Lu, Kitty Dickerson

Sheng Lu

The U.S. textile and apparel (T&A) industries have respectively adopted various restructuring strategies in recent years which fundamentally changed the way the two industries operate and the shifting relationship of each sector with imports. This study empirically tests the relationship between import penetration and the operation of the U.S. T&A industries based on data at 4-digit North American Industrial Classification System (NAICS) code level from 2002-2008. Results from the panel data model show that overall the U.S. textile industry formed a weak cooperative relationship with import penetration level in the U.S. market and a neutral relationship was suggested for the …

The United States-Korea Free Trade Agreement (Korus) And Its Impact On China’S Textile And Apparel Exports To The United States, Sheng Lu, Kitty Dickerson

Sheng Lu

This study is an empirical evaluation of the impact of the U.S.-Korea Free Trade Agreement (KORUS) on China’s textile and apparel (T&A) exports to the United States, with special focus on potential trade diversion effects of the agreement. On the basis of estimated export similarity index and trade elasticity of substitution values for T&A products of China and South Korea, trade diversion caused by the KORUS is predicted to most strongly affect China’s apparel exports (in HS Chapters 60-63). The KORUS may also affect China’s exports in other T&A categories (in HS Chapters 51, 52, 56, 57 and 59), but …

China Takes All? An Empirical Study On The Impacts Of Quota Elimination On World Clothing Trade From 2000 To 2009, Sheng Lu

Sheng Lu

Purpose – This study aims to empirically investigate the impacts of quota elimination on world clothing trade. Design/methodology/approach - Multivariate analysis of variance (MANOVA) was undertaken based on trade statistics of 51 clothing exporters from 2000 to 2009 provided by the World Trade Organization (WTO). Findings – First, exporters’ performances in response to quota elimination overall were suggested unequal among countries located in different geographic regions of the world. Second, clothing exporters located in different geographic regions were suggested having unequal results of compound annual growth rate from 2005 to 2009 and market share changes from 2000 to 2009. Third, …

Introduction To Special Issue: Globalisation And Economic Integration In East Asia, Paul De Grauwe, Zhaoyong Zhang

Zhaoyong Zhang

No abstract provided.

The Child Health Implications Of Privatizing Africa's Urban Water Supply, Katrina Kosec

Katrina Kosec

On The Pro-Trade Effects Of Immigrants, Massimiliano Bratti, Luca De Benedictis, Gianluca Santoni

Luca De Benedictis

This paper investigates the causal effect of immigration on trade flows using Italian panel data at the province level. We exploit the exceptional characteristics of the Italian data (the fine geographical disaggregation, the very high number of countries of origin of immigrants, the high heterogeneity of social and economic characteristics of Italian provinces, and the absence of cultural or historical ties) coupled with the use of a wide set of fixed effects and an `instrument' based on immigrants' enclaves. We find that immigrants have a significant positive effect on both exports and imports, but much larger for the latter. The …

Chinese Privatization: Between Plan And Market, Lan Cao

Lan Cao

No abstract provided.

The Ethnic Question In Law And Development, Lan Cao

Lan Cao

No abstract provided.

Monetary Integration And Optimum Currency Area In Asean+3: What We Need For A New Framework?, Reza Moosavi Mohseni Dr., Azali Mohammed Prof.

Reza Moosavi Mohseni

In this paper at first we investigate the viability of creating an optimum currency area (OCA) in the East Asia. The results of a ten-variable VAR model show that forming an OCA for all of the countries in the region is costly and difficult to sustain. But at first five countries called Japan, China, Korea, Malaysia, and the Philippine with symmetric supply shocks can create the OCA. The findings also show that both dollar and yen can be suitable anchor for these countries, but with the exception of Indonesia all other countries are better potential clients of dollar. The final …

Can A Unilateral Carbon Tax Reduce Emissions Elsewhere?, Joshua Elliott, Don Fullerton

Don Fullerton

One country or sector that tries to reduce greenhouse gas emissions may fear that other countries or sectors will get a competitive advantage and increase emissions. Computable general equilibrium (CGE) models such as Elliott et al (2010a,b) indicate that 15% to 25% of abatement might be offset by this “leakage.” Yet the Fullerton et al (2012) simple two-sector analytical general equilibrium model shows an offsetting term with negative leakage. In this paper, we use a full CGE model with many countries and many goods to measure effects in a way that allows for this negative leakage term. We vary elasticities …

Microfoundations Of The Rule Of Law, Gillian K. Hadfield, Barry R. Weingast

Gillian K Hadfield

Many social scientists rely on the rule of law in their accounts of political or economic development. Many however simply equate law with a stable government capable of enforcing the rules generated by a political authority. As two decades of largely failed efforts to build the rule of law in poor and transition countries and continuing struggles to build international legal order demonstrate, we still do not understand how legal order is produced, especially in places where it does not already exist. We here canvas literature in the social sciences to identify the themes and gaps in the existing accounts. …

The Cobden-Chevalier Effect: Evaluating The Causal Effect Of The Most Favoured Nation Clause In Presence Of Network Interdependence, Luca De Benedictis, Silvia Nenci

Luca De Benedictis

Does Foreign Aid Reduce Tax Revenue? Further Evidence, John Thornton

John Thornton

A common criticism of foreign aid is that it reduces domestic tax effort. Empirical research on the issue has been hampered by the failure to tackle endogeneity issues effectively. We use measures of geographical and cultural distance to donor countries as instrumental variables to uncover the causal effect of aid on tax revenue in a panel of 93 countries. The tax to GDP ratio is found to decrease following aid inflows. This reduction in tax effort is statistically and economically significant; a one SD increase in aid causes a 0.52 percentage point drop in the tax-to-GDP ratio. The results indicate …

The (Small) Blessing Of Foreign Aid: Further Evidence On Aid's Impact On Democracy, John Thornton

John Thornton

In an empirical contribution to the literature of foreign aid, we estimate the impact of foreign aid on democracy in a panel of 93 developing economies during 1971–2010. We find that foreign aid promotes democracy, with the result robust to different estimation methodologies and control variables and to instrumenting for foreign aid.

Beyond Deterrence And Decline Towards A General Understanding Of Peace Economics, Raul Caruso

Raul Caruso

The aim of this short article is to provide elements for a general discussion on peace economics and its potential contribution to economics and economic policy. I first present a discussion on deterrence equilibria and consequent allocation of resources. Eventually I expound five economic channels through which military expenditures turn to be detrimental for economic development. Finally some elements to build a framework for a peaceful economic policy are presented.

Corporate Social Responsibility In A Remedy-Seeking Society: A Public Choice Perspective, Donald J. Kochan

Donald J. Kochan

Written for the Chapman Law Review Symposium on “What Can Law & Economics Teach Us About the Corporate Social Responsibility Debate?,” this Article applies the lessons of public choice theory to examine corporate social responsibility. The Article adopts a broad definition of corporate social responsibility activism to include both (1) those efforts that seek to convince corporations to voluntarily take into account corporate social responsibility in their own decision-making, and (2) the efforts to alter the legal landscape and expand legal obligations of corporations beyond traditional notions of harm and duty so as to force corporations to invest in interests …

Negative Leakage, Kathy Baylis, Don Fullerton, Daniel H. Karney

Kathy Baylis

Our analytical general equilibrium model solves for effects of a small increase in carbon tax on leakage - the increase in emissions elsewhere. Identical consumers buy two goods using income from endowments that are mobile between sectors. Usually an increase in one sector's tax raises output price, so consumption shifts to the other good, causing positive leakage. Here, we find a new negative effect not recognized in existing literature: the taxes sector substitutes away from carbon into clean inputs, so it may absorb resources, shrink the other sector and reduce their emissions. This "abatement resource effect" could offset some or …

Effects Of Export Restrictions On Domestic Market Efficiency: The Case Of India’S Rice And Wheat Export Ban, Kathy Baylis, Maria Christina Jolejole-Foreman, Mindy Mallory

Kathy Baylis

The use of export restrictions has substantially increased in recent years. While a number of papers show how these restrictions have increased world commodity prices, in this paper, we empirically estimate how one country’s export restrictions affected the efficiency of their domestic market. We use a threshold cointegration model to estimate the integration between selected wheat and rice markets in India before and during the export bans and test whether those bans exacerbated the price effects of domestic production shocks. We find that before the ban, the majority of port markets for rice and wheat are integrated with the world …