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Articles 1 - 7 of 7

Full-Text Articles in International Economics

Allocative Efficiency, Mark-Ups, And The Welfare Gains From Trade, Thomas J. Holmes, Wen-Tai Hsu, Sanghoon Lee Jul 2013

Allocative Efficiency, Mark-Ups, And The Welfare Gains From Trade, Thomas J. Holmes, Wen-Tai Hsu, Sanghoon Lee

Research Collection School Of Economics

This paper develops an index of allocative efficiency that depends upon the distribution of mark-ups across goods and is separable from an index of standard Ricardian gains from trade. It determines how changes in trade frictions affect allocative efficiency in an oligopoly model of international trade, decomposing the effect into the cost-change channel and the price-change channel. Formulas are derived shedding light on the signs and magnitudes of the two channels. In symmetric country models, trade tends to increase allocative efficiency through the cost-change channel, yielding a welfare benefit beyond productive efficiency gains. In contrast, the price-change channel has ambiguous …


Host Country Financial Development And Mnc Activity, L. Kamran Bilir, Davin Chor, Manova Kalina Feb 2013

Host Country Financial Development And Mnc Activity, L. Kamran Bilir, Davin Chor, Manova Kalina

Research Collection School Of Economics

Multinational corporations (MNCs) manage complex operations, often blending features of three modes of FDI that are well understood in isolation but not in tandem, namely: horizontal, vertical and export-platform FDI. We develop a three-country model with heterogeneous firms, in order to analyze how financing constraints in the FDI host country affect the relative strength of these three motives for FDI. In our model, financial development in the host country fosters entry by domestic firms, making the local market more competitive for MNC products. This leads MNCs to orient their affiliate sales away from the local market toward other markets instead. …


Entropy-Based Analysis And Bioinformatics-Inspired Integration Of Global Economic Information Transfer, Jinkyu Kim, Gunn Kim, Sungbae An, Young-Kyun Kwon, Sungroh Yoon Jan 2013

Entropy-Based Analysis And Bioinformatics-Inspired Integration Of Global Economic Information Transfer, Jinkyu Kim, Gunn Kim, Sungbae An, Young-Kyun Kwon, Sungroh Yoon

Research Collection School Of Economics

The assessment of information transfer in the global economic network helps to understand the current environment and the outlook of an economy. Most approaches on global networks extract information transfer based mainly on a single variable. This paper establishes an entirely new bioinformatics-inspired approach to integrating information transfer derived from multiple variables and develops an international economic network accordingly. In the proposed methodology, we first construct the transfer entropies (TEs) between various intra- and inter-country pairs of economic time series variables, test their significances, and then use a weighted sum approach to aggregate information captured in each TE. Through a …


Impact Of Sovereign Debt Restructuring On Financial Flows: The Case Of Indonesia, Hwee Kwan Chow, C. Adams Jan 2013

Impact Of Sovereign Debt Restructuring On Financial Flows: The Case Of Indonesia, Hwee Kwan Chow, C. Adams

Research Collection School Of Economics

No abstract provided.


Monetary Regime Choice In Singapore: Would A Tayor Rule Outperform Exchange-Rate Management?, Hwee Kwan Chow, G.C. Lim, P. Mcnelis Jan 2013

Monetary Regime Choice In Singapore: Would A Tayor Rule Outperform Exchange-Rate Management?, Hwee Kwan Chow, G.C. Lim, P. Mcnelis

Research Collection School Of Economics

This paper adopts a dynamic stochastic general equilibrium-vector autorgressive (DSGE-VAR) approach to examine the managed exchange-rate system at work in Singapore. We examine if the country has any reason to fear floating the exchange rate and adopting a Taylor rule. Our results show that, in terms of overall inflation volatility, the exchange rate rule has a comparative advantage over the Taylor rule when export price shocks are the major sources of real volatility, while a Taylor rule dominates when domestic productivity shocks drive real volatility. The exchange-rate rule also dominates the Taylor rule for reducing inflation persistence.


Financial Development, International Capital Flows, And Aggregate Output, Jürgen Von Hagen, Haiping Zhang Jan 2013

Financial Development, International Capital Flows, And Aggregate Output, Jürgen Von Hagen, Haiping Zhang

Research Collection School Of Economics

We develop a tractable two-country overlapping-generations model and show that cross-country differences in financial development can explain three recent empirical patterns of international capital flows: Financial capital flows from relatively poor to relatively rich countries, while foreign direct investment flows in the opposite direction; net capital flows go from poor to rich countries; despite its negative net international investment positions, the United States receives a positive net investment income. International capital mobility affects output in each country directly through the size of domestic investment and indirectly through the aggregate saving rate. Under certain conditions, the indirect effect may dominate the …


Can A Financial Conditions Index Guide Monetary Policy? The Case Of Singapore, Hwee Kwan Chow Jan 2013

Can A Financial Conditions Index Guide Monetary Policy? The Case Of Singapore, Hwee Kwan Chow

Research Collection School Of Economics

In this study, we explore the issue of whether a financial conditions index can serve as a useful guide to monetary policy in the context of Singapore. To this end, we construct an index that comprises not only the usual monetary variables like interest rates, exchange rates and credit expansions but also asset prices such as stock prices and house prices. The choice of these constituent series is motivated by the role they play in the monetary transmission mechanism with consideration given to the key role leverage plays in modern business cycles and the risk-taking channel magnified by the prolonged …