This work focuses on the welfare costs of exposure to shocks and uncertainty linked to trade opennes - a prominent issue in the international debate. It contributes by presenting a comprehensive review of the literature on the "destabilizing effects" of trade openness, drawing together studies in different fields. It provides a conceptualization of vulnerability and three promising lines of reasoning for future research on the link between trade and vulnerability.
{"title":"Does Trade Openness Increase Vulnerability? A Survey of the Literature","authors":"P. Montalbano","doi":"10.2139/ssrn.1996810","DOIUrl":"https://doi.org/10.2139/ssrn.1996810","url":null,"abstract":"This work focuses on the welfare costs of exposure to shocks and uncertainty linked to trade opennes - a prominent issue in the international debate. It contributes by presenting a comprehensive review of the literature on the \"destabilizing effects\" of trade openness, drawing together studies in different fields. It provides a conceptualization of vulnerability and three promising lines of reasoning for future research on the link between trade and vulnerability.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"18 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2012-01-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126479991","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 Trans-Pacific Partnership (TPP) Agreement aims to be a high quality, 21st Century economic agreement that furthers economic integration in the Asia Pacific. In late 2011 it remains unclear whether the TPP will turn out to be a stepping stone or stumbling block towards regional or global economic integration. The current negotiations involve Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the United States and Vietnam with Japan, Mexico and Canada expressing interest in joining. The potential economic and political significance of the TPP depends on the expansion of the membership to include Japan, Korea, Indonesia, other East Asian economies, and especially China, as well as the ultimate quality of any agreement. Including additional members will be difficult after a deal is concluded among the original members and partners with whom they are currently in negotiation, especially if the content of the agreement and the accession criteria are not designed carefully and specifically with additional membership in mind. Desirably TPP will contribute to the global system by making it easier for others to join. That includes multilateralising preferences within the TPP, and eventually extending that treatment to non-members. Importantly, the agenda of negotiations needs to focus on reducing regulatory and institutional, behind-the-border barriers to trade and commerce. Focus on strengthening intellectual property rights, including stringent labour and environmental and other so called "platinum" standards will make it difficult for many members and non-members to participate fully. The TPP has the potential to keep the United States engaged in the region but complications will arise with a TPP to which China is not party, or an inward looking East Asian arrangement to which the United States is not party. A regional arrangement that does not include both the United States and China is more likely to disrupt than to contribute to regional trade and prosperity.
{"title":"Australia and the Future of the Trans-Pacific Partnership Agreement","authors":"S. Armstrong","doi":"10.2139/ssrn.1970129","DOIUrl":"https://doi.org/10.2139/ssrn.1970129","url":null,"abstract":"The Trans-Pacific Partnership (TPP) Agreement aims to be a high quality, 21st Century economic agreement that furthers economic integration in the Asia Pacific. In late 2011 it remains unclear whether the TPP will turn out to be a stepping stone or stumbling block towards regional or global economic integration. The current negotiations involve Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the United States and Vietnam with Japan, Mexico and Canada expressing interest in joining. The potential economic and political significance of the TPP depends on the expansion of the membership to include Japan, Korea, Indonesia, other East Asian economies, and especially China, as well as the ultimate quality of any agreement. Including additional members will be difficult after a deal is concluded among the original members and partners with whom they are currently in negotiation, especially if the content of the agreement and the accession criteria are not designed carefully and specifically with additional membership in mind. Desirably TPP will contribute to the global system by making it easier for others to join. That includes multilateralising preferences within the TPP, and eventually extending that treatment to non-members. Importantly, the agenda of negotiations needs to focus on reducing regulatory and institutional, behind-the-border barriers to trade and commerce. Focus on strengthening intellectual property rights, including stringent labour and environmental and other so called \"platinum\" standards will make it difficult for many members and non-members to participate fully. The TPP has the potential to keep the United States engaged in the region but complications will arise with a TPP to which China is not party, or an inward looking East Asian arrangement to which the United States is not party. A regional arrangement that does not include both the United States and China is more likely to disrupt than to contribute to regional trade and prosperity.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"128 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-12-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130855003","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 sets up a two-country model of oligopoly to analyze the relationship between trade costs and trade policy cooperation. Acting non-cooperatively, the two countries are caught in a prisoner’s dilemma in which import tariffs are used to improve one country’s terms of trade and to shift profits towards its domestic market at the expense of the other. The incentive to do this is higher when trade costs are lower. Cooperative trade policy, on the other hand, is concerned with minimizing losses in transit, such that internationally efficient tariffs are lower when trade costs fall. Hence, there is a conflict of interest between unilateral and cooperative trade policy in response to reductions in trade costs. I then analyze trade policy cooperation which must be sustained by a reputation mechanism. I first demonstrate that, provided the two countries care sufficiently about the future, lower import tariffs are more self-enforceable when trade costs are lower. I also find that global free trade can be supported for a larger range of discount factors in response to falling trade costs, provided firms interact strategically.
{"title":"The Self-Enforceability of Trade Agreements in the Presence of Trade Costs","authors":"C. Soegaard","doi":"10.2139/ssrn.1966066","DOIUrl":"https://doi.org/10.2139/ssrn.1966066","url":null,"abstract":"This paper sets up a two-country model of oligopoly to analyze the relationship between trade costs and trade policy cooperation. Acting non-cooperatively, the two countries are caught in a prisoner’s dilemma in which import tariffs are used to improve one country’s terms of trade and to shift profits towards its domestic market at the expense of the other. The incentive to do this is higher when trade costs are lower. Cooperative trade policy, on the other hand, is concerned with minimizing losses in transit, such that internationally efficient tariffs are lower when trade costs fall. Hence, there is a conflict of interest between unilateral and cooperative trade policy in response to reductions in trade costs. I then analyze trade policy cooperation which must be sustained by a reputation mechanism. I first demonstrate that, provided the two countries care sufficiently about the future, lower import tariffs are more self-enforceable when trade costs are lower. I also find that global free trade can be supported for a larger range of discount factors in response to falling trade costs, provided firms interact strategically.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"107 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-11-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131748669","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}
What is the relationship between real exchange rate misalignments and economic growth? And what effect, if any, did undervaluations or overvaluations of the lira/euro have on Italy's growth? We address these questions by presenting, first, three main facts: (i) there is a positive relationship between undervaluation and growth; (ii) this relationship is strong for developing countries and weak for advanced countries; (iii) these results tend to hold for both the pre- and the post-World War II period. Building a simple analytical model, we explore channels through which undervaluation may exert a positive effect on real GDP. We assume that productivity is higher in the tradeable-goods than in the non-tradeable-goods sector, and examine the roles of market structure, scale economies and wage flexibility in channelling resources from the latter to the former sector, increasing exports and real GDP. We then turn to Italy and verify empirically that, as the theory suggests, undervaluation has positively affected its exports. Undervaluation has been helpful, in particular, to increase the exports of high-productivity sectors, such as most manufacturing industries. Finally, we describe the misalignments of the lira/euro since 1861, analyze their determinants and draw the implications for Italy's economic growth.
{"title":"Real Exchange Rates, Trade, and Growth: Italy 1861-2011","authors":"Virginia Di Nino, Barry Eichengreen, M. Sbracia","doi":"10.2139/ssrn.2236718","DOIUrl":"https://doi.org/10.2139/ssrn.2236718","url":null,"abstract":"What is the relationship between real exchange rate misalignments and economic growth? And what effect, if any, did undervaluations or overvaluations of the lira/euro have on Italy's growth? We address these questions by presenting, first, three main facts: (i) there is a positive relationship between undervaluation and growth; (ii) this relationship is strong for developing countries and weak for advanced countries; (iii) these results tend to hold for both the pre- and the post-World War II period. Building a simple analytical model, we explore channels through which undervaluation may exert a positive effect on real GDP. We assume that productivity is higher in the tradeable-goods than in the non-tradeable-goods sector, and examine the roles of market structure, scale economies and wage flexibility in channelling resources from the latter to the former sector, increasing exports and real GDP. We then turn to Italy and verify empirically that, as the theory suggests, undervaluation has positively affected its exports. Undervaluation has been helpful, in particular, to increase the exports of high-productivity sectors, such as most manufacturing industries. Finally, we describe the misalignments of the lira/euro since 1861, analyze their determinants and draw the implications for Italy's economic growth.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"37 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-10-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121035559","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}
There is not one, perfect model for institutional regulatory cooperation, nor is there a single model for eliminating technical barriers to trade or discriminatory sanitary and phytosanitary measures in a preferential trade agreement (PTA). However, recent experience with PTAs has shown that it is possible to progress beyond entirely separate regulation in specific sectors by each party with bilateral government committees that only meet once a year to joint committees that meet on a regular basis and engage in joint harmonization, rule-making, mutual recognition, and problem-solving. In a new generation PTA (either free trade agreement or customs union) in which economic integration is an agreed policy objective, joint institutions will be necessary to effectively implement harmonization of standards and development of joint standards codes as well as mutual recognition of technical regulations, standards and occupational qualifications.
{"title":"Institutions for Regulatory Cooperation in 'New Generation' Economic and Trade Agreements","authors":"D. Steger","doi":"10.2139/SSRN.1947421","DOIUrl":"https://doi.org/10.2139/SSRN.1947421","url":null,"abstract":"There is not one, perfect model for institutional regulatory cooperation, nor is there a single model for eliminating technical barriers to trade or discriminatory sanitary and phytosanitary measures in a preferential trade agreement (PTA). However, recent experience with PTAs has shown that it is possible to progress beyond entirely separate regulation in specific sectors by each party with bilateral government committees that only meet once a year to joint committees that meet on a regular basis and engage in joint harmonization, rule-making, mutual recognition, and problem-solving. In a new generation PTA (either free trade agreement or customs union) in which economic integration is an agreed policy objective, joint institutions will be necessary to effectively implement harmonization of standards and development of joint standards codes as well as mutual recognition of technical regulations, standards and occupational qualifications.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"179 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131816526","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}
Setting up Experimental Economic Development Zone and groping the way across the river is the successful experience of China's reform and opening up, which could be referenced for global trade governance. Similarly, Economic Integration (FTA) should be regarded as an experimental area of the global multilateral trade governance institutions (WTO). The tough contradiction between balanced development of trade and equally enjoying fruits of the development by all members along with deficiencies of the WTO multilateral trade governance institutions could be broken, through the practicality and experimental role of establishing FTA by seeking successful experience, regulations and mechanisms. And they will be applied to the WTO multilateral system to better make it a sound global trade governance institution. Consequently, the WTO and FTA of long‐term coexistence and complementary trend is a new pattern of global trade governance.
{"title":"A New Model for Global Governance: Mutual Benefit of the WTO and FTAs","authors":"Luosha Li","doi":"10.2139/ssrn.2169342","DOIUrl":"https://doi.org/10.2139/ssrn.2169342","url":null,"abstract":"Setting up Experimental Economic Development Zone and groping the way across the river is the successful experience of China's reform and opening up, which could be referenced for global trade governance. Similarly, Economic Integration (FTA) should be regarded as an experimental area of the global multilateral trade governance institutions (WTO). The tough contradiction between balanced development of trade and equally enjoying fruits of the development by all members along with deficiencies of the WTO multilateral trade governance institutions could be broken, through the practicality and experimental role of establishing FTA by seeking successful experience, regulations and mechanisms. And they will be applied to the WTO multilateral system to better make it a sound global trade governance institution. Consequently, the WTO and FTA of long‐term coexistence and complementary trend is a new pattern of global trade governance.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"2 3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131490680","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}
In December 2001, China joined the WTO and became the 143rd full member. In the last decade, China's international trade developed rapidly and it has consequently become the largest commodity exporter and the second largest importer in the world. Undoubtedly, China's international status has improved significantly. During this period, the pattern of international economy and trade are also undergoing profound changes. The changes of the balance of power between developing and developed countries, new forms of international trade barriers, a large number of bilateral free trade zones as well as some developed countries' rethinking of globalization are all consequences of the rapid rise of China and its interactions with the outside world. Simultaneously, all this contributes to the uncertainty of the future of China's foreign trade. China's position and influence in the WTO depend not only on China's own development, but also its interrelationship with other countries. So far, China has taken safeguarding the interests of the core areas as a priority in the Doha Round of negotiations, and this negotiation strategy proved to be practical and effective. Since 2008, China has gradually taken a key role in decision-making in Doha Round negotiations, but its composition of influence is unbalanced. Huge market and the scale of imports is still the crucial source of China's influence, and the gap between China and other leading powers is mainly reflected in the soft power, such as agenda-setting capacity in multilateral negotiations, the dispute-solving skills and the power of guiding the public voice and so on. Whether China can exert the power of considerable leadership compatible with its position as a leading trader depends not only on China's political will, but also on its design of path to the multilateral trading system, professional training and the speed with which it enhances its soft power. In December 2001, after 15 years of hard negotiations, China became a full member of the WTO, its 143rd. Over the past decade, China seized opportunities for development and basically realized initial strategic goals, which built the foundation of long-term development. China obtained permanent MFN treatment by the U.S., relative fair and stable international trading environment and the right to participate in the WTO dispute settlement and rules-making. Above all, the accession to WTO helped dramatically promote domestic reform and open and stimulate the economy. Then how to see the function and influence of China in this multilateral trade system? Firstly, we should analyze the current situation of China's trade and its international background, which will help to understand China's choice of standpoint in the WTO negotiations and policy development's path.
{"title":"China's Status and Influence in the Multilateral Trade System","authors":"Xiaodong Wang","doi":"10.2139/ssrn.2169312","DOIUrl":"https://doi.org/10.2139/ssrn.2169312","url":null,"abstract":"In December 2001, China joined the WTO and became the 143rd full member. In the last decade, China's international trade developed rapidly and it has consequently become the largest commodity exporter and the second largest importer in the world. Undoubtedly, China's international status has improved significantly. During this period, the pattern of international economy and trade are also undergoing profound changes. The changes of the balance of power between developing and developed countries, new forms of international trade barriers, a large number of bilateral free trade zones as well as some developed countries' rethinking of globalization are all consequences of the rapid rise of China and its interactions with the outside world. Simultaneously, all this contributes to the uncertainty of the future of China's foreign trade. China's position and influence in the WTO depend not only on China's own development, but also its interrelationship with other countries. So far, China has taken safeguarding the interests of the core areas as a priority in the Doha Round of negotiations, and this negotiation strategy proved to be practical and effective. Since 2008, China has gradually taken a key role in decision-making in Doha Round negotiations, but its composition of influence is unbalanced. Huge market and the scale of imports is still the crucial source of China's influence, and the gap between China and other leading powers is mainly reflected in the soft power, such as agenda-setting capacity in multilateral negotiations, the dispute-solving skills and the power of guiding the public voice and so on. Whether China can exert the power of considerable leadership compatible with its position as a leading trader depends not only on China's political will, but also on its design of path to the multilateral trading system, professional training and the speed with which it enhances its soft power. In December 2001, after 15 years of hard negotiations, China became a full member of the WTO, its 143rd. Over the past decade, China seized opportunities for development and basically realized initial strategic goals, which built the foundation of long-term development. China obtained permanent MFN treatment by the U.S., relative fair and stable international trading environment and the right to participate in the WTO dispute settlement and rules-making. Above all, the accession to WTO helped dramatically promote domestic reform and open and stimulate the economy. Then how to see the function and influence of China in this multilateral trade system? Firstly, we should analyze the current situation of China's trade and its international background, which will help to understand China's choice of standpoint in the WTO negotiations and policy development's path.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"24 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127695586","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}
In order to facilitate trade, bilateral investment treaties create a favourable framework for the promotion and protection of foreign investment. The core guarantees present in most bilateral investment treaties include national and most-favoured nation treatment, fair and equitable treatment, free transfer of funds, protection against expropriation and an international dispute settlement mechanism. In the light of the problematic status of intra-European Union bilateral investment treaties, the purpose of this article is to assess whether there is a viable alternative under the European law comparable to the protection of investments given in BITs among member states of the European Union.Common standards of European law offer similar protection in terms of guarantees for free transfer of capital and protection against expropriation. National and most-favoured nation treatment, which are replicated by the EU principle of non-discrimination, has even broader ambit, providing investors with higher safeguards on pre-entry stage of investments. EU law does not contain the same forms of protection, which are covered by fair and equitable treatment clauses in BITs. Nonetheless, EU law does embrace some features attributed to the protection under fair and equitable treatment through the application of omnipresent principles of European law. National court systems of the European Union may not be able to offer competitive procedure of asserting investment claims. Therefore, submission to the national courts instead of arbitration tribunals remains the most contentious difference between BITs and EU law. In relation to this, establishment of a specialised European court dealing with international investment claims is proposed.
{"title":"Is There an Alternative to Intra-European Bilateral Investment Treaties Framework under European Law?","authors":"Dominik Moskvan","doi":"10.2139/SSRN.2221905","DOIUrl":"https://doi.org/10.2139/SSRN.2221905","url":null,"abstract":"In order to facilitate trade, bilateral investment treaties create a favourable framework for the promotion and protection of foreign investment. The core guarantees present in most bilateral investment treaties include national and most-favoured nation treatment, fair and equitable treatment, free transfer of funds, protection against expropriation and an international dispute settlement mechanism. In the light of the problematic status of intra-European Union bilateral investment treaties, the purpose of this article is to assess whether there is a viable alternative under the European law comparable to the protection of investments given in BITs among member states of the European Union.Common standards of European law offer similar protection in terms of guarantees for free transfer of capital and protection against expropriation. National and most-favoured nation treatment, which are replicated by the EU principle of non-discrimination, has even broader ambit, providing investors with higher safeguards on pre-entry stage of investments. EU law does not contain the same forms of protection, which are covered by fair and equitable treatment clauses in BITs. Nonetheless, EU law does embrace some features attributed to the protection under fair and equitable treatment through the application of omnipresent principles of European law. National court systems of the European Union may not be able to offer competitive procedure of asserting investment claims. Therefore, submission to the national courts instead of arbitration tribunals remains the most contentious difference between BITs and EU law. In relation to this, establishment of a specialised European court dealing with international investment claims is proposed.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131294147","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 study evaluates a novel scheme to trade sulfur dioxide emission permits subject to non-uniform rates. These rates are based on generators’ marginal costs of compliance with environmental policy in a hypothesized least social-cost solution. This scheme is compared against the existing trading program used by the U.S. Environmental Protection Agency, featuring permits tradable one for one. Both policies are modeled to yield identical aggregate emissions. A numerical partial-equilibrium model of the U.S. energy industry is used to infer sulfur dioxide concentrations and health damages, as well as producer and consumer surplus, under the two policies. Regional pollution levels are found to vary across the two policies significantly. The system of exchange rates is estimated to outperform the uniform-trading scheme by $2.2 billion in industry profits and $2.1 billion in health damages, but to reduce consumer surplus by $6.7 billion. Paradoxically, exchange rates are thus estimated to lower total welfare by $2.5 billion. This is due to conceptual mechanism-design problems, as well as empirical issues.
{"title":"SO2 Emission Permits Tradable Under Exchange Rates: U.S. Case","authors":"V. Hlasny","doi":"10.2139/ssrn.2029452","DOIUrl":"https://doi.org/10.2139/ssrn.2029452","url":null,"abstract":"This study evaluates a novel scheme to trade sulfur dioxide emission permits subject to non-uniform rates. These rates are based on generators’ marginal costs of compliance with environmental policy in a hypothesized least social-cost solution. This scheme is compared against the existing trading program used by the U.S. Environmental Protection Agency, featuring permits tradable one for one. Both policies are modeled to yield identical aggregate emissions. A numerical partial-equilibrium model of the U.S. energy industry is used to infer sulfur dioxide concentrations and health damages, as well as producer and consumer surplus, under the two policies. Regional pollution levels are found to vary across the two policies significantly. The system of exchange rates is estimated to outperform the uniform-trading scheme by $2.2 billion in industry profits and $2.1 billion in health damages, but to reduce consumer surplus by $6.7 billion. Paradoxically, exchange rates are thus estimated to lower total welfare by $2.5 billion. This is due to conceptual mechanism-design problems, as well as empirical issues.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"61 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126652102","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}
Trade between China, Africa and the Middle East has rapidly expanded over the past thirty years. However, the economic relations between China and these countries has displayed a remarkable amount of diversity across countries, over time, and for different kinds of trade. I utilize this heterogeneity to analyze the determinants of Chinese trade with 65 countries in Africa and the Middle East over the period 1985-2008. I find that Chinese trade is influenced by three factors: access to local markets, securing natural resources, and foreign policy as proxied by a country's diplomatic relations with Taiwan. The presence of an export processing zone and Chinese FDI act as gateways for imports of differentiated goods from China. China also appears to be using trade as a political tool, as countries that recognize Taiwan have significantly less trade with China, though trade rapidly increases once a country severs relations with Taiwan. Interestingly, exports of homogeneous goods to China appear to be unaffected by the Taiwan issue, perhaps suggesting that China's need for natural resources trumps any foreign policy considerations. The heterogeneity of trade determinants is an important result given the rather monolithic treatment Africa often gets in the existing literature.
{"title":"China's Trade with Africa and the Middle East: A Tale of Markets, Politics, and Resources","authors":"Hisham S. Foad","doi":"10.2139/ssrn.2198482","DOIUrl":"https://doi.org/10.2139/ssrn.2198482","url":null,"abstract":"Trade between China, Africa and the Middle East has rapidly expanded over the past thirty years. However, the economic relations between China and these countries has displayed a remarkable amount of diversity across countries, over time, and for different kinds of trade. I utilize this heterogeneity to analyze the determinants of Chinese trade with 65 countries in Africa and the Middle East over the period 1985-2008. I \u001cfind that Chinese trade is influenced by three factors: access to local markets, securing natural resources, and foreign policy as proxied by a country's diplomatic relations with Taiwan. The presence of an export processing zone and Chinese FDI act as gateways for imports of differentiated goods from China. China also appears to be using trade as a political tool, as countries that recognize Taiwan have significantly less trade with China, though trade rapidly increases once a country severs relations with Taiwan. Interestingly, exports of homogeneous goods to China appear to be unaffected by the Taiwan issue, perhaps suggesting that China's need for natural resources trumps any foreign policy considerations. The heterogeneity of trade determinants is an important result given the rather monolithic treatment Africa often gets in the existing literature.","PeriodicalId":285675,"journal":{"name":"PSN: International Trade Policy (Topic)","volume":"31 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2011-08-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131935518","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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