Elisheba Spiller, R. Esparza, Kristina Mohlin, Karen Tapia-Ahumada, Burcin Unel
This paper simulates the effect of more advanced residential electricity tariffs on household adoption of distributed energy resources (DERs). We employ an end-user DER investment and operational engineering optimization model, and adapt it to include an economic utility function, calibrated to the observed hourly residential electricity consumption data from 2016 in the Commonwealth Edison service territory in Chicago, in order to represent household-level preferences for electricity consumption. We simulate the effect of a spectrum of electricity tariffs, from the status quo flat volumetric tariffs to more sophisticated tariffs that are reflective of electricity generation and distribution system costs. We find that tariffs that are more time variant lead to greater reductions in coincident peak demands than flat volumetric tariffs, both from load shifting as well as from adoption of DERs. Regarding the effect of electricity tariff design on DER investments, we find that at current DER purchase costs investments in rooftop photovoltaic (PV), batteries and natural gas distributed generators are not privately optimal under any of our tariff design scenarios based on current cost levels for electricity and gas in the Chicago study area. However, with continued reductions in PV technology costs, rooftop PV may see a greater adoption rate under some of the more cost-reflective tariffs. We also demonstrate a greater incentive to invest in electrification of household space heating in the form of heat pumps under cost-reflective tariffs. These findings provide insights on electricity tariff design and the role of DERs in the future decarbonized electricity system, and highlight the need to consider region-specific costs and conditions when analyzing the effects of electric tariff reform.
{"title":"The Role of Electricity Tariff Design in Distributed Energy Resource Deployment","authors":"Elisheba Spiller, R. Esparza, Kristina Mohlin, Karen Tapia-Ahumada, Burcin Unel","doi":"10.2139/ssrn.3711073","DOIUrl":"https://doi.org/10.2139/ssrn.3711073","url":null,"abstract":"This paper simulates the effect of more advanced residential electricity tariffs on household adoption of distributed energy resources (DERs). We employ an end-user DER investment and operational engineering optimization model, and adapt it to include an economic utility function, calibrated to the observed hourly residential electricity consumption data from 2016 in the Commonwealth Edison service territory in Chicago, in order to represent household-level preferences for electricity consumption. We simulate the effect of a spectrum of electricity tariffs, from the status quo flat volumetric tariffs to more sophisticated tariffs that are reflective of electricity generation and distribution system costs. We find that tariffs that are more time variant lead to greater reductions in coincident peak demands than flat volumetric tariffs, both from load shifting as well as from adoption of DERs. Regarding the effect of electricity tariff design on DER investments, we find that at current DER purchase costs investments in rooftop photovoltaic (PV), batteries and natural gas distributed generators are not privately optimal under any of our tariff design scenarios based on current cost levels for electricity and gas in the Chicago study area. However, with continued reductions in PV technology costs, rooftop PV may see a greater adoption rate under some of the more cost-reflective tariffs. We also demonstrate a greater incentive to invest in electrification of household space heating in the form of heat pumps under cost-reflective tariffs. These findings provide insights on electricity tariff design and the role of DERs in the future decarbonized electricity system, and highlight the need to consider region-specific costs and conditions when analyzing the effects of electric tariff reform.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"58 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84837617","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-10-12DOI: 10.33094/8.2017.2020.81.30.37
K. M. Uddin, Munem Ahmad Chowdhury
This study is designed to investigate the role of Foreign Direct Investment (FDI) in overall job creation in Bangladesh where annual time series data is used spanning from 1991 to 2018. The role of gross domestic products (GDP) and trade openness on employment level are also addressed. Johansen-Juselius cointegration and Vector error correction model are performed to check long run relationship and short run dynamics among the variables. The findings show that there exists co-integrating relations among the variables. Both FDI and GDP have significant positive effect on employment but trade openness possess the negative impact on employment in the long run. But FDI is negatively related with employment in the short run. This paper suggests to concentrate on making efficient policies to attract investors in green field investment which means investing for the establishment of new firms to create job opportunities in a large scale and to give the opportunity and logistic support to the native producers to produce more import substituted goods for reducing import dependence tendency.
{"title":"Impact of FDI on Employment Level in Bangladesh: A VECM Approach","authors":"K. M. Uddin, Munem Ahmad Chowdhury","doi":"10.33094/8.2017.2020.81.30.37","DOIUrl":"https://doi.org/10.33094/8.2017.2020.81.30.37","url":null,"abstract":"This study is designed to investigate the role of Foreign Direct Investment (FDI) in overall job creation in Bangladesh where annual time series data is used spanning from 1991 to 2018. The role of gross domestic products (GDP) and trade openness on employment level are also addressed. Johansen-Juselius cointegration and Vector error correction model are performed to check long run relationship and short run dynamics among the variables. The findings show that there exists co-integrating relations among the variables. Both FDI and GDP have significant positive effect on employment but trade openness possess the negative impact on employment in the long run. But FDI is negatively related with employment in the short run. This paper suggests to concentrate on making efficient policies to attract investors in green field investment which means investing for the establishment of new firms to create job opportunities in a large scale and to give the opportunity and logistic support to the native producers to produce more import substituted goods for reducing import dependence tendency.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"53 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83103462","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We study the role of financial development on the aggregate effects and welfare implications of reducing international trade barriers on production inputs such as physical capital and intermediates. We document that financially underdeveloped economies feature a slower response of real GDP, consumption, and investment following trade liberalization episodes that improve access to imported production inputs. We set up a quantitative general equilibrium model with heterogeneous firms subject to financial constraints and estimate it to match salient features from Colombian plant-level data. We find that the adjustment to a decline of import tariffs on physical capital and intermediate inputs is significantly slower in financially underdeveloped economies in line with the empirical evidence. Moreover, we find that financial development increases the welfare gains from trade liberalization; low-income agents benefit from higher wages while exporters benefit from a depreciated real exchange rate and lower capital costs.
{"title":"Financial Development and Trade Liberalization","authors":"Fernando Leibovici, Michal Szkup, D. Kohn","doi":"10.2139/ssrn.3722226","DOIUrl":"https://doi.org/10.2139/ssrn.3722226","url":null,"abstract":"We study the role of financial development on the aggregate effects and welfare implications of reducing international trade barriers on production inputs such as physical capital and intermediates. We document that financially underdeveloped economies feature a slower response of real GDP, consumption, and investment following trade liberalization episodes that improve access to imported production inputs. We set up a quantitative general equilibrium model with heterogeneous firms subject to financial constraints and estimate it to match salient features from Colombian plant-level data. We find that the adjustment to a decline of import tariffs on physical capital and intermediate inputs is significantly slower in financially underdeveloped economies in line with the empirical evidence. Moreover, we find that financial development increases the welfare gains from trade liberalization; low-income agents benefit from higher wages while exporters benefit from a depreciated real exchange rate and lower capital costs.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"126 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89853986","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The main objective of this study is to examine the long-run relationship between export upgrading and economic growth for 67 countries over the period of 1984–2013. For this purpose, a panel cointegration framework that allows to control for parameters heterogeneity, cross-sectional dependence and non-stationarity has been deployed. Empirical results yield evidence of a positive and significant effect of export upgrading on economic growth for the full-sample and high-income panels, while this effect is negative and significant for low-income countries and insignificant for middle-income countries. Particularly, our findings show evidence of an inverted U-shaped relationship for the global and high-income panels. However, for low-income countries relationship between export complexity and economic growth was found to be U-shaped. These results are robust to several robustness checks and have important policy implications. In developed countries, excessive export complexity may be job-destructive and thereby threatens long-run growth and prosperity. For non-developed countries, exports diversification should be prioritized during the first stages of development. Industrial upgrading should not be considered as a strategic economic policy before the economy reaches a minimum level of maturity.
{"title":"Does Export Upgrading Really Matter to Economic Growth? Evidence From Panel Data for High-, Middle-, and Low-Income Countries","authors":"Mohamed Chakroun, Naima Chrid, Sami Saafi","doi":"10.2139/ssrn.3717430","DOIUrl":"https://doi.org/10.2139/ssrn.3717430","url":null,"abstract":"The main objective of this study is to examine the long-run relationship between export upgrading and economic growth for 67 countries over the period of 1984–2013. For this purpose, a panel cointegration framework that allows to control for parameters heterogeneity, cross-sectional dependence and non-stationarity has been deployed. Empirical results yield evidence of a positive and significant effect of export upgrading on economic growth for the full-sample and high-income panels, while this effect is negative and significant for low-income countries and insignificant for middle-income countries. Particularly, our findings show evidence of an inverted U-shaped relationship for the global and high-income panels. However, for low-income countries relationship between export complexity and economic growth was found to be U-shaped. These results are robust to several robustness checks and have important policy implications. In developed countries, excessive export complexity may be job-destructive and thereby threatens long-run growth and prosperity. For non-developed countries, exports diversification should be prioritized during the first stages of development. Industrial upgrading should not be considered as a strategic economic policy before the economy reaches a minimum level of maturity.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"24 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85220293","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This policy brief is a submission to the Joint Standing Committee on Trade and Investment Growth Inquiry into whether there is a need for Australia to diversify its trade markets and foreign investment profile. The views, ideas, and recommendations presented in this report represent those of the authors only. We gratefully acknowledge the data support provided by Dr Dessie Ambaw.
{"title":"Supply Chain Security and Australia in the Context of Resilience, Robustness and Diversification","authors":"Peter W. Draper, N. McDonagh, Simon Lacey","doi":"10.2139/ssrn.3702132","DOIUrl":"https://doi.org/10.2139/ssrn.3702132","url":null,"abstract":"This policy brief is a submission to the Joint Standing Committee on Trade and Investment Growth Inquiry into whether there is a need for Australia to diversify its trade markets and foreign investment profile. The views, ideas, and recommendations presented in this report represent those of the authors only. We gratefully acknowledge the data support provided by Dr Dessie Ambaw.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"3 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88137533","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper proposes a novel measure of political risk that confirms some of the findings documented in the Foreign Direct Investments (FDI) literature. Particularly, we confirm the positive relationship between political stability and its components on FDI inflows, and the moderating effect of natural resources on this relationship. The proposed political risk measure contains relevant, unique and incremental information not observed in the literature. For example, although this measure is highly correlated with the political risk rating of the International Country Risk Guide (ICRG), it contains unique information that explains FDI inflows beyond what is explained by the ICRG rating. A link to the database for our political risk rating for 150 countries covering 2000 to 2015 has been provided.
{"title":"A Novel measure of Political Risk and Foreign Direct Investment Inflows","authors":"Pavel Jeutang, K. Kesse","doi":"10.2139/ssrn.3686932","DOIUrl":"https://doi.org/10.2139/ssrn.3686932","url":null,"abstract":"This paper proposes a novel measure of political risk that confirms some of the findings documented in the Foreign Direct Investments (FDI) literature. Particularly, we confirm the positive relationship between political stability and its components on FDI inflows, and the moderating effect of natural resources on this relationship. The proposed political risk measure contains relevant, unique and incremental information not observed in the literature. For example, although this measure is highly correlated with the political risk rating of the International Country Risk Guide (ICRG), it contains unique information that explains FDI inflows beyond what is explained by the ICRG rating. A link to the database for our political risk rating for 150 countries covering 2000 to 2015 has been provided.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"40 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85820877","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The economic significance and benefits of foreign trade also known as international trade to the economies of developing countries cannot be overemphasized. Its role and contributions to the gross domestic earnings, employment generation, economic development, and poverty reduction in these underdeveloped countries such as Nigeria, Ghana, Benin Republic, and others have been too glaring especially in agrarian economies with fertile arable land.The main aim of this paper was to examine in-depth the contributions and relationship between international trade and the economic development of developing African countries. Furthermore, this paper recommended stringent macroeconomic policies that when formulated would encourage and increase the multiplier effect of these (foreign) trades. Part of these policies is targeted towards exchange rates, tariffs, import and export duties, subsidies, and actions that promote international trade.The research further concluded that internationaltradeis a key macroeconomic driver that must be encouraged in developing African countries as its multiplier effects have the potentials of driving the needed development goals of these nations. And for this to be achieved, these nations (developing countries) must formulate workable localized macroeconomic policies that suit and drive their interest as against borrowed economic policies from the developed European and Asian nations. Some of the recommendations proffered include adoption of friendly and pro-active export promotion policies, availability of grants, aids, subsidies, and loans, mechanization of the agrarian sector, adoption of flexible exchange rate, etc.This study made use of time series secondary data obtained from the World Development Indicators (WDI) and the United Nations Conference on Trade and Development (UNCTAD) of developing African countries for a period between 2000 and 2019. A forecast of 15 years was also initiated using these data to provide a long-term insight into the benefits of these trading activities on the GDP of developing countries.
{"title":"International Trade and the Economies of Developing Countries","authors":"Nwabueze Prince Okenna, B. Adesanya","doi":"10.2139/ssrn.3664322","DOIUrl":"https://doi.org/10.2139/ssrn.3664322","url":null,"abstract":"The economic significance and benefits of foreign trade also known as international trade to the economies of developing countries cannot be overemphasized. Its role and contributions to the gross domestic earnings, employment generation, economic development, and poverty reduction in these underdeveloped countries such as Nigeria, Ghana, Benin Republic, and others have been too glaring especially in agrarian economies with fertile arable land.The main aim of this paper was to examine in-depth the contributions and relationship between international trade and the economic development of developing African countries. Furthermore, this paper recommended stringent macroeconomic policies that when formulated would encourage and increase the multiplier effect of these (foreign) trades. Part of these policies is targeted towards exchange rates, tariffs, import and export duties, subsidies, and actions that promote international trade.The research further concluded that internationaltradeis a key macroeconomic driver that must be encouraged in developing African countries as its multiplier effects have the potentials of driving the needed development goals of these nations. And for this to be achieved, these nations (developing countries) must formulate workable localized macroeconomic policies that suit and drive their interest as against borrowed economic policies from the developed European and Asian nations. Some of the recommendations proffered include adoption of friendly and pro-active export promotion policies, availability of grants, aids, subsidies, and loans, mechanization of the agrarian sector, adoption of flexible exchange rate, etc.This study made use of time series secondary data obtained from the World Development Indicators (WDI) and the United Nations Conference on Trade and Development (UNCTAD) of developing African countries for a period between 2000 and 2019. A forecast of 15 years was also initiated using these data to provide a long-term insight into the benefits of these trading activities on the GDP of developing countries.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"919 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77524621","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Arbitration and adjudication aim at protecting rule-of-law, which was a life-long concern for Prof. Giorgio Bernini. The United Nations (UN) have defined ‘rule of law at national and international levels’ as ‘a principle of governance in which all persons, institutions and entities, including the State itself, are accountable to laws that are publicly promulgated, equally enforced and independently adjudicated, and which are consistent with internationally recognized human rights’. Such ‘rule of law’ has emerged in worldwide trade and investment law only since the 1990s with the ‘judicialization’ of GATT/WTO law and investor-state arbitration (ISA). Both the World Trade Organization (WTO) adjudication and ISA are today challenged: The power-oriented blockage of Appellate Body (AB) nominations by the USA has rendered the WTO AB dysfunctional; it re-introduced power-politics into the WTO dispute settlement system, limited by voluntary ‘interim appellate arbitration’. ISA is rejected by some developing countries and inside the European Union as a threat to democratic constitutionalism. This contribution discusses these dialectic developments, i.e. ISA reforms aimed at strengthening ‘public law adjudication’ inside and beyond the European Union; the WTO appellate court system being transformed into voluntary arbitration in response to alleged ‘judicial overreach’; and multilevel judicial cooperation inside the EU, where the German Constitutional Court has - for the first time since the beginning of European economic integration in the 1950s - refused complying with a judgment of the European Court of Justice (CJEU) on the ground that the CJEU and the European Central Bank exceeded their limited powers ‘arbitrarily’ due to their insufficient ‘proportionality justification’ of encroachment on national economic and fiscal policy powers. How can rule-of-law, constitutional and ‘deliberative democracy’ and judicial comity be protected in multilevel, judicial cooperation among national and international courts?
{"title":"Rule-of-Law in International Trade and Investments? Between Multilevel Arbitration, Adjudication and ‘Judicial Overreach’","authors":"E. Petersmann","doi":"10.2139/ssrn.3685242","DOIUrl":"https://doi.org/10.2139/ssrn.3685242","url":null,"abstract":"Arbitration and adjudication aim at protecting rule-of-law, which was a life-long concern for Prof. Giorgio Bernini. The United Nations (UN) have defined ‘rule of law at national and international levels’ as ‘a principle of governance in which all persons, institutions and entities, including the State itself, are accountable to laws that are publicly promulgated, equally enforced and independently adjudicated, and which are consistent with internationally recognized human rights’. Such ‘rule of law’ has emerged in worldwide trade and investment law only since the 1990s with the ‘judicialization’ of GATT/WTO law and investor-state arbitration (ISA). Both the World Trade Organization (WTO) adjudication and ISA are today challenged: The power-oriented blockage of Appellate Body (AB) nominations by the USA has rendered the WTO AB dysfunctional; it re-introduced power-politics into the WTO dispute settlement system, limited by voluntary ‘interim appellate arbitration’. ISA is rejected by some developing countries and inside the European Union as a threat to democratic constitutionalism. This contribution discusses these dialectic developments, i.e. ISA reforms aimed at strengthening ‘public law adjudication’ inside and beyond the European Union; the WTO appellate court system being transformed into voluntary arbitration in response to alleged ‘judicial overreach’; and multilevel judicial cooperation inside the EU, where the German Constitutional Court has - for the first time since the beginning of European economic integration in the 1950s - refused complying with a judgment of the European Court of Justice (CJEU) on the ground that the CJEU and the European Central Bank exceeded their limited powers ‘arbitrarily’ due to their insufficient ‘proportionality justification’ of encroachment on national economic and fiscal policy powers. How can rule-of-law, constitutional and ‘deliberative democracy’ and judicial comity be protected in multilevel, judicial cooperation among national and international courts?","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"5 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90156009","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Brexit reshapes not only the EU-UK relations but also impact their trade relations with Asia. This article explores possible directions of EU/UK trade relations with Asia, covering free trade agreements, bilateral investment treaty and the UK’s potential participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This article argues that a sense of competitive liberalization motivates their pursuit for trade opportunities with East Asia. The EU has to prove its continuous relevance in the international economic relations as the Brexiters allege it as a constraint for the UK to pursue active and flexible trade relations. In contrast, the UK has to fulfill its promise of Global Britain by delivering measurable progress in trade negotiations instead of renegotiating back what it has already enjoyed under the EU free trade agreements (FTAs). Brexit, Global Europe, Global Britain, Free Trade Agreement, Bilateral Investment Treaty, Comprehensive and Progressive Agreement for Trans-pacific Partnership, populism, disintegration
{"title":"Brexit in the Eyes of East: How Will it Reshape Eu/Uk Trade Relations with East Asia?","authors":"Chien-Huei Wu","doi":"10.54648/eerr2020028","DOIUrl":"https://doi.org/10.54648/eerr2020028","url":null,"abstract":"Brexit reshapes not only the EU-UK relations but also impact their trade relations with Asia. This article explores possible directions of EU/UK trade relations with Asia, covering free trade agreements, bilateral investment treaty and the UK’s potential participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This article argues that a sense of competitive liberalization motivates their pursuit for trade opportunities with East Asia. The EU has to prove its continuous relevance in the international economic relations as the Brexiters allege it as a constraint for the UK to pursue active and flexible trade relations. In contrast, the UK has to fulfill its promise of Global Britain by delivering measurable progress in trade negotiations instead of renegotiating back what it has already enjoyed under the EU free trade agreements (FTAs).\u0000Brexit, Global Europe, Global Britain, Free Trade Agreement, Bilateral Investment Treaty, Comprehensive and Progressive Agreement for Trans-pacific Partnership, populism, disintegration","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"454 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77522120","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Low cost of labor has been one of the major incentives that foreign firms invest in many developing countries. Yet, many developing countries including China and ASEAN have recently experienced a rapid increase in labor costs. Using the wage information provided by JETRO, this study examines how Korean FDI outflow is affected by the increase in labor costs of the manufacturing industry in host countries. The results indicate that the worker’s and engineer’s wages in Asian developing countries, who accumulated at least 3 and 5 years of work experience, have generally a negative impact on Korean FDI outflow. However, there exist positive relationships between the wages and FDI when the wages stay at very low levels. We do not find evidence that labor costs make a significant impact on Korean FDI outflow to European or Developed countries.
{"title":"Determinants of Korean Outward Foreign Direct Investment: How Do Korean Firms Respond to the Labor Costs of Host Countries?","authors":"Hanbyul Ryu, Young SIk Jeong","doi":"10.2139/ssrn.3700761","DOIUrl":"https://doi.org/10.2139/ssrn.3700761","url":null,"abstract":"Low cost of labor has been one of the major incentives that foreign firms invest in many developing countries. Yet, many developing countries including China and ASEAN have recently experienced a rapid increase in labor costs. Using the wage information provided by JETRO, this study examines how Korean FDI outflow is affected by the increase in labor costs of the manufacturing industry in host countries. The results indicate that the worker’s and engineer’s wages in Asian developing countries, who accumulated at least 3 and 5 years of work experience, have generally a negative impact on Korean FDI outflow. However, there exist positive relationships between the wages and FDI when the wages stay at very low levels. We do not find evidence that labor costs make a significant impact on Korean FDI outflow to European or Developed countries.","PeriodicalId":14394,"journal":{"name":"International Political Economy: Trade Policy eJournal","volume":"39 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90233010","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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