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Articles 1 - 5 of 5
Full-Text Articles in International Economics
Cross-Border Technology Investments In Recession, Juliana Yu Sun, Huanhuan Zheng
Cross-Border Technology Investments In Recession, Juliana Yu Sun, Huanhuan Zheng
Research Collection School Of Economics
Utilizing industry-level foreign direct investment (FDI) from 72 source markets to 122 destination markets between 2003 to 2018, we evaluate how cross-border technology investments respond to economic recessions. We find that FDI embedded with intensive research and development (R&D) drops when the destination market is in a recession and the source market is in a normal state and recovers to the pre-recession levels when both destination and source markets are in recession. However, there is little evidence that recessions affect cross-border investments in other aspects of technology measured by the penetration of robots, intellectual property products and information and communications …
Macroeconomic Effects Of Energy Price Shocks On The Business Cycle, Bao Tan Huynh
Macroeconomic Effects Of Energy Price Shocks On The Business Cycle, Bao Tan Huynh
Research Collection School Of Economics
This paper proposes a framework of endogenous energy production with convex costs to investigate the general equilibrium effects of energy price shocks on the business cycle. This framework explicitly models the consumption of durables and nondurables and implements a high complementarity between energy and the usage of durables and capital. The model predicts energy price elasticities of various consumption variables that fall within reasonable agreement with empirical estimates. Convex costs in energy production produce energy price and energy supply dynamics that tallies well with empirical behavior. Our analysis confirms in a theoretical setting recent observations that not all energy price …
Could Tariffs Be Pro-Cyclical?, James Lake, Maia K. Linask
Could Tariffs Be Pro-Cyclical?, James Lake, Maia K. Linask
Economics Faculty Publications
Conventional wisdom says that tariffs are counter-cyclical. We analyze the relationship between business cycles and applied MFN tariffs using a disaggregated product-level panel dataset covering 72 countries between 2000 and 2011. Strikingly, and counter to conventional wisdom, we find that tariffs are pro-cyclical. Further investigation reveals that this pro-cyclicality is driven by the tariff setting behavior of developing countries; tariffs are acyclical in developed countries. We present evidence that pro-cyclical market power drives the pro-cyclicality of tariffs in developing countries, providing further evidence of the importance of terms of trade motivations in explaining trade policy.
Output And Interest Rate Volatility As Determinants Of Fdi, Lilia Cavallari, Stefano D'Addona
Output And Interest Rate Volatility As Determinants Of Fdi, Lilia Cavallari, Stefano D'Addona
Lilia Cavallari
This paper examines the role of country-specific sources of output and interest rate volatility in driving FDI activities. Building on a dataset that comprises bilateral FDI flows among 24 OECD economies over the period 1985-2007, we find that output and interest rate volatility mainly act as push factors, i.e. they are more effective in deterring rather than encouraging foreign investments. A rise in host country volatilities does reduce the amount of FDI outflows in the recipient country, even after controlling for the state of the cycle. Source country volatilities, on the contrary, do not have a systematic effect on foreign …
Industry Structure Similarities, Trade Agreements, And Business Cycle Synchronization, Samuel D. Marll
Industry Structure Similarities, Trade Agreements, And Business Cycle Synchronization, Samuel D. Marll
Gettysburg Economic Review
This paper analyzes the effects of industry structure similarities, free trade agreements, and geographic borders on regional business cycle correlation, using fifty US states, 10 Canadian provinces, and 1 Canadian territory as a case study. Using two cross-sectional OLS regressions and one panel data OLS regression, this study finds that pair-wise gross territorial product growth correlation decreased significantly after NAFTA ratification for state-state, province-province, and state-province territorial pairs, contrary to previous literature’s results. NAFTA effectively decoupled intra-national business cycles in the US and Canada while also desynchronizing cross-border pair-wise GSP growth correlation, but cross-border pair-wise GSP growth correlation was much …