NBER Working Paper Series
Опубликовано на портале: 23-12-2003
James R. Tybout
NBER Working Paper Series.
2001.
w8418.
By relaxing the assumption of perfect competition, the 'new' trade theory has generated
a rich body of predictions concerning the effects of commercial policy on price-cost
mark-ups, firm sizes, exports, productivity and profitability among domestic producers.
This paper critically assesses the plant- and firm-level evidence on these linkages.
Several robust findings are identified. First, mark-ups generally fall with import
competition, but it is not clear whether this phenomenon reflect the elimination
of market power or the creation of negative economic profits. Second, import-competing
firms cut back their production levels when foreign competition intensifies, at least
in the short run. This suggests that sunk entry or exit costs are important in most
sectors. Third, trade rationalizes production in the sense that markets for the most
efficient plants are expanded, but large import-competing firms tend to simultaneously
contract. Fourth exposure to foreign competition often improves intra-plant efficiency.
Fifth, firms that engage in international activities tend to be larger, more productive,
and supply higher quality products. However the literature is mixed on whether international
activities cause these characteristics or vice versa. Finally, the short-run and
long-run effects of commercial policy on exports and market structure can be quite
different. Both types of response depend upon initial conditions, sunk entry costs,
and the extent of firm heterogeneity.
Опубликовано на портале: 24-12-2003
James Harrigan
NBER Working Paper Series.
2001.
w8675.
The core subjects of trade theory are the pattern and volume of trade: which goods
are traded by which countries, and how much of those goods are traded. The first
part of the paper discusses evidence on comparative advantage, with an emphasis on
carefully connecting theory models to data analyses. The second part of the chapter
first considers the theoretical foundations of the gravity model, and then reviews
the small number of papers that have tried to test, rather than simply use, the implications
of gravity. Both parts of the paper yield the same conclusion: we are still in the
very early stages of empirically understanding specialization and the volume of trade,
but the work that has been done can serve as a starting point for further research.
Опубликовано на портале: 23-12-2003
Mattias Ganslandt, James R. Markusen
NBER Working Paper Series.
2001.
. w8346.
Standards and technical regulations which govern the admissibility of imported goods
into an economy raise costs of exporters entering new markets, and may have a particularly
high impact on firms seeking to export from developing countries. Yet standards may
also have a positive side, such as certifying product quality and safety for the
consumer. This paper suggests approaches to modeling standards and technical regulations,
with a particular concern that these approaches are at least potentially implementable
in an applied general-equilibrium model with real data.
Tax Competition and Trade Protection [статья]
Опубликовано на портале: 23-12-2003
Eckhard Janeba, John D. Wilson
NBER Working Paper Series.
1999.
w7402.
This paper reconsiders the question of whether tax competition for mobile capital
leads to tax rates on capital that are too low or too high from the combined viewpoint
of the competing regions (or countries in an economic union). In contrast to standard
models of tax competition, both commodity trade and capital mobility is allowed to
occur between the competing regions and the rest of the world. A key result of the
analysis is that whether the capital taxes are too low or high depends on the degree
of external trade protection. When the country's central government is free to set
the tariff, tax competition leads to inefficiently low tax rates. But in the absence
of a tariff, tax rates can be too high. In particular, regions may choose to subsidize
capital in equilibrium as a means of inducing favorable terms-of-trade effects, but
the subsidy (i.e., a negative tax) will then be too low because an increase in a
single region's subsidy benefits other regions by reducing their relative quantities
of subsidized capital. These results are discussed in the context of the European
Union's Single Market, where non-EU firms have responded to the 'Fortress of Europe'
by increasing foreign direct investment.
Testing Trade Theory in Ohlin's Time [статья]
Опубликовано на портале: 22-12-2003
Antoni Estevadeordal, Alan M. Taylor
NBER Working Paper Series.
2002.
w8842.
An empirical tradition in international trade seeks to establish whether the predictions
of factor abundance theory match present-day data. In the analysis of goods trade
and factor endowments, mildly encouraging results were found by Leamer et al. But
ever since the appearance of Leontief's paradox, the measured factor content of trade
has always been found to be far smaller than its predicted magnitude in the Heckscher-Ohlin-Vanek
framework, the so-called 'missing trade' mystery. Autors wonder if this problem was there
in the theory from the beginning. This seems like a fairer test of its creators'
original enterprise. Autors apply contemporary tests to historical data on goods and
factor trade from Ohlin's time. Autor's analysis is set in a very different context than
contemporary studies - an era with lower trade barriers, higher transport costs,
a more skewed global distribution of the relevant factors (especially land), and
comparably large productivity divergence. Autors find some support for the theory, but
also encounter common problems. Autor's work thus complements the tests applied to today's
data and informs our search for improved models of trade.
The Effects of Multinational Production on Wages and Working Conditions in Developing
Countries [статья]
Опубликовано на портале: 23-12-2003
Drusilla K. Brown, Alan V. Deardorff, Robert M. Stern
NBER Working Paper Series.
2003.
w9669.
This paper assesses the evidence regarding the effects of multinational production
on wages and working conditions in developing countries. It is motivated by recent
controversies concerning whether multinational firms in developing countries exploit
workers by paying low wages and subjecting them to substandard conditions. Authors
first
address efforts of activist groups, universities, and colleges in the Anti-Sweatshop'
Campaign in the United States, the social accountability of multinational firms,
and the role of such international institutions as the International Labor Organization
and World Trade Organization in dealing with labor standards and trade. Authors then
consider
conceptually how foreign direct investment might affect host-country wages. Available
theories yield ambiguous predictions, leaving the effects to be examined empirically.
Authors therefore, finally, review empirical evidence on multinational firm wages
in developing
countries, and the relationship between foreign direct investment and labor rights.
This evidence indicates that multinational firms routinely provide higher wages and
better working conditions than their local counterparts, and they are typically not
attracted preferentially to countries with weak labor standards.
Опубликовано на портале: 22-12-2003
Marc J. Melitz
NBER Working Paper Series.
2002.
w8881.
This paper builds a dynamic industry model with heterogeneous firms that explains
why international trade induces reallocations of resources among firms in an industry.
The paper shows how the exposure to trade will induce only the more productive firms
to enter the export market (while some less productive firms continue to produce
only for the domestic market) and will simultaneously force the least productive
firms to exit. It then shows how further increases in the industry's exposure to
trade lead to additional inter-firm reallocations towards more productive firms.
These phenomena have been empirically documented but can not be explained by current
general equilibrium trade models, because they rely on a representative firm framework.
The paper also shows how the aggregate industry productivity growth generated by
the reallocations contributes to a welfare gain, thus highlighting a benefit from
trade that has not been examined theoretically before. The paper adapts Hopenhayn's
(1992a) dynamic industry model to monopolistic competition in a general equilibrium
setting. In so doing, the paper provides an extension of Krugman's (1980) trade model
that incorporates firm level productivity differences. Firms with different productivity
levels coexist in an industry because each firm faces initial uncertainty concerning
its productivity before making an irreversible investment to enter the industry.
Entry into the export market is also costly, but the firm's decision to export occurs
after it gains knowledge of its productivity.
Опубликовано на портале: 24-12-2003
Douglas A. Irwin
NBER Working Paper Series.
2001.
w8689.
The United States produced about 80 percent of the world's cotton in the decades
prior to the Civil War. How much monopoly power did the United States possess in
the world cotton market and what would have been the effect of an optimal export
tax? This paper estimates the elasticity of foreign demand for U.S. cotton exports
and uses the elasticity in a simple partial equilibrium model to calculate the optimal
export tax and its effect on prices, trade, and welfare. The results indicate that
the export demand elasticity for U.S. cotton was about -1.7 and that the optimal
export tax of about 50 percent would have raised U.S. welfare by about $6 million,
about 0.1 percent of U.S. GDP or about 0.5 percent of the South's GDP.
Опубликовано на портале: 23-12-2003
John Mutti, Harry Grubert
NBER Working Paper Series.
1996.
w5526.
This paper examines how rules to determine the source of income internationally for
tax purposes can have important effects on the form in which taxable income is reported
and on the location of economic activity. In the case of U.S. law, two provisions
are significant: allowing a portion of export income to be regarded as foreign source
and treating royalties received as foreign source. These source rules have become
increasingly important due to tax policy changes adopted in the 1980s and to the
growing role in U.S. production and trade of goods that require intangible intellectual
property. In addition, very similar transactions can be carried out as trade in goods,
trade in services or production by a foreign affiliate, and tax incentives can influence
that choice. How the source rules operate and the incentives they create are demonstrated
in a set of stylized calculations to determine after-tax returns under various assumptions
about relevant income and withholding tax rates, tariffs, and the importance of tangible
and intangible capital in production. An assessment of the empirical importance of
these provisions is based on recent studies of the determinants of trade and investment
by U.S. multinational corporations. The treatment of royalty income appears to encourage
royalty payments from high-tax countries and to promote real economic activity there.
Опубликовано на портале: 23-12-2003
Christopher Blattman, Jason Hwang, Jeffrey G. Williamson
NBER Working Paper Series.
2003.
w9940.
The contending fundamental determinants of growth - institutions, geography and
culture - exhibit far more persistence than do the growth rates they are supposed
to explain. So, what exogenous shocks might account for the variance around those
persistent fundamentals? The terms of trade seems to be one good place to look. Using
a panel data base for 35 countries, this paper estimates the impact of terms of trade
volatility and secular change between 1870 and 1938. Authors find that volatility
was
much more important than secular change. Additionally, both effects were asymmetric
between core and periphery, findings that speak directly to the terms of trade debates
that have raged since Prebisch and Singer wrote more than 50 years ago.
Опубликовано на портале: 22-12-2003
Peter J. Klenow, David Hummels
NBER Working Paper Series.
2002.
w8712.
Not surprisingly, big countries trade more than small countries. In this paper autors
use data on shipments by 110 exporters to 59 importers in 5,000 product categories
to ask: how? Do big countries trade larger quantities of a common set of goods (the
intensive margin), a larger set of goods (the extensive margin), or higher quality
goods? Autors find that the extensive margin accounts for two-thirds of the greater exports
of larger economies, and one-third of the greater imports of larger economies. Richer
countries export more units at higher prices. These calculations are useful for distinguishing
features of trade models that correspond more or less well to the data. Models with
Armington national product differentiation do not feature the extensive margin, and
wrongly predict that greater output will be accompanied by worse terms of trade.
"Krugman" style models with firm level product differentation fare better, but must
be modified to include quality differentiation and fixed costs of trading to match
all of the facts. Estimates based on these modifications imply that differences in
goods' quality could be the proximate cause of about 25% of country differences in
real income per worker.
Опубликовано на портале: 24-12-2003
Douglas A. Irwin
NBER Working Paper Series.
2001.
w8692.
The United States came close to complete autarky in 1808 as a result of a self-imposed
embargo on international shipping from December 1807 to March 1809. Monthly prices
of exported and imported goods reveal the embargo's striking effect on commodity
markets and allow a calculation of its welfare effects. A simple general equilibrium
calculation suggests that the embargo cost about 8 percent of America's 1807 GNP,
at a time when the trade share was about 13 percent (domestic exports and shipping
earnings). The welfare cost was lower than the trade share because the embargo did
not completely eliminate trade and because domestic producers successfully shifted
production toward previously imported manufactured goods.
Trade, Growth and the Environment [статья]
Опубликовано на портале: 23-12-2003
Brian R. Copeland, M. Scott Taylor
NBER Working Paper Series.
2003.
w9823.
For the last ten years environmentalists and the trade policy community have engaged
in a heated debate over the environmental consequences of liberalized trade. The
debate was originally fueled by negotiations over the North American Free Trade Agreement
and the Uruguay round of GATT negotiations, both of which occurred at a time when
concerns over global warming, species extinction and industrial pollution were rising.
Recently it has been intensified by the creation of the World Trade Organization
(WTO) and proposals for future rounds of trade negotiations. The debate has often
been unproductive. It has been hampered by the lack of a common language and also
suffered from little recourse to economic theory and empirical evidence. The purpose
of this essay is set out what we currently know about the environmental consequences
of economic growth and international trade. We critically review both theory and
empirical work to answer three basic questions. What do we know about the relationship
between international trade, economic growth and the environment? How can this evidence
help us evaluate ongoing policy debates? Where do we go from here?
Trade Integration and Risk Sharing [статья]
Опубликовано на портале: 22-12-2003
Aart Kraay, Jaume Ventura
NBER Working Paper Series.
2002.
w8804.
What are the effects of increased trade in goods and services on the trade balance?
Autors study the effects of reducing transport costs in a Ricardian model with complete
asset markets. Trade integration has three effects on the structure of the economy:
a reduction in the home bias in consumption, an increase in the degree of international
competition in goods markets, and a reduction in real exchange rate volatility. The
reduction in the home bias increases the volatility of the trade balance regardless
of the source of shocks. Except for the case where supply shocks lead to counter-cyclical
trade balances, (i) the increase in international competition also increases the
volatility of the trade balance; and (ii) the reduction in real exchange rate volatility
increases the volatility of the trade balance if risk aversion is low but lowers
it if risk aversion is high. The opposite applies when supply shocks lead to counter-cyclical
trade balances. Autors calibrate the model to U.S. data and provide a quantitative assessment
of the effects of increased trade in services on the trade balance.
Trade Policy and Industrial Sector Responses: Using Evolutionary Models to Interpret
the Evidence [статья]
Опубликовано на портале: 23-12-2003
Erkan Erdem, James R. Tybout
NBER Working Paper Series.
2003.
w9947.
Firm- and plant-level empirical studies typically find that trade liberalization
squeezes price-cost margins among import-competing firms, that this heightened competitive
pressure induces productivity gains among these same firms, and that further efficiency
gains come from market share reallocations. Using a computable industrial evolution
model to simulate the dynamic effects of import competition, we demonstrate what
types of managerial behavior, long-term transition paths and welfare effects are
consistent with this set of stylized facts.
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