Bilateral exchange rates and jobs

We study the labor market effects of realignment in fixed bilateral exchange rates, such as China's peg to the US dollar. We employ the open economy model by de Melo and Robinson to identify the core parameters of the real, trade side of the economy driving the unemployment effects of bilateral exchange rate realignment. A small open economy version of the model is explored analytically and a large multicountry version numerically. Analytics in the small open economy model show that unemployment effects of adjusting of a bilateral peg hinge on the fraction exported to and imported from the trading partner. A larger fraction exported to and a smaller fraction imported from the trading partner make it more likely that revaluation of a trading partner's currency has beneficial effects. Numerics in the large economy model show that Chinese revaluation can generate both positive and negative unemployment effects depending upon underlying parameter values. Adverse unemployment effects can go along with an improving trade balance.

Towards a new balance of trade in agriculture

Trade in agriculture is linked to a whole range of economic, environmental, societal and future interests. For this reason, international regulation of trade in agricultural goods is highly contentious. While mainly directed towards an opening of markets, the WTO Agreement on Agriculture also has some entry points for ‘non trade concerns’. However, the agreement still looks like a casual patchwork that allows rather unsystematic ally for exemptions, without explicitly exposing the grounds that allow for them. The question arises of how the agreement could be drafted in a more structured way, in order to make sure that the economic objectives are efficiently pursued, and at the same time that human rights and environmental concerns are adequately taken account of? The concept of sustainable development provides for a methodical ‘seven step’ framework that gives guidance on integrated decision making processes. In this paper, this framework is partially applied to the Agreement on Agriculture. This working paper served as an introductory note to a brainstorming workshop on the subject that took place on 27 March 2009 at the World Trade Institute, University of Bern.

Rezension zu: Inge Govaere and Hanns Ulrich (eds.): Intellectual Property, Public Policy and International Trade

The contemporary intellectual property rights (IPR) system is not a simple, smoothly working block of rules but is complex and full of ambiguities, and as many argue, imperfections. Some deficits relate on the one hand to the inherent centrality of authorship, originality and mercantilism to the ‘Western’ IP model, which leaves numerous non-Western, collaborative or folkloric modes of production outside the scope of protection. On the other hand, some imperfections stem from the way IPR are granted, whereby creators acquire a temporary monopoly over their works and thus exclude the public from having access to them. In this sense, it is often uncertain whether the existent IPR model appropriately reflects the precarious balance between private and public interests, and whether the best incentives to promote creativity and innovation - the initially stated objectives of intellectual property protection - are offered. The matter becomes still more complicated when one considers that the IPR system is not domestically contained but is globalised and strongly affected by rules at the regional and international levels. The question of whether the balance between private interests and public values is sustained within the international legal framework, epitomised by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) of the World Trade Organization (WTO), is precisely the topic of the book reviewed here. Review of Intellectual Property, Public Policy, and International Trade, edited by Inge Govaere and Hanns Ullrich, P.I.E. Peter Lang, 2007.

Large-scale land acquisition and its effects on the water balance in investor and host countries

This study examines the validity of the assumption that international large-scale land acquisition (LSLA) is motivated by the desire to secure control over water resources, which is commonly referred to as ‘water grabbing’. This assumption was repeatedly expressed in recent years, ascribing the said motivation to the Gulf States in particular. However, it must be considered of hypothetical nature, as the few global studies conducted so far focused primarily on the effects of LSLA on host countries or on trade in virtual water. In this study, we analyse the effects of 475 intended or concluded land deals recorded in the Land Matrix database on the water balance in both host and investor countries. We also examine how these effects relate to water stress and how they contribute to global trade in virtual water. The analysis shows that implementation of the LSLAs in our sample would result in global water savings based on virtual water trade. At the level of individual LSLA host countries, however, water use intensity would increase, particularly in 15 sub-Saharan states. From an investor country perspective, the analysis reveals that countries often suspected of using LSLA to relieve pressure on their domestic water resources—such as China, India, and all Gulf States except Saudi Arabia—invest in agricultural activities abroad that are less water-intensive compared to their average domestic crop production. Conversely, large investor countries such as the United States, Saudi Arabia, Singapore, and Japan are disproportionately externalizing crop water consumption through their international land investments. Statistical analyses also show that host countries with abundant water resources are not per se favoured targets of LSLA. Indeed, further analysis reveals that land investments originating in water-stressed countries have only a weak tendency to target areas with a smaller water risk.

Prospects in International Investment Law and Policy: World Trade Forum

The negotiation of a patchy but burgeoning network of international investment agreements and the increasing use to which they are put is generating a growing body of jurisprudence which, while still evolving, requires closer analytical scrutiny. Drawing on many of the most distinguished voices in investment law and policy, and offering novel, multidisciplinary perspectives on the rapidly evolving landscape shaping international investment activity and treaty-making, this book explores the most important economic, legal and policy challenges in contemporary international investment law and policy. It also examines the systemic implications flowing from frenetic recent judicial activism in investment matters and advances several innovative propositions for how best to promote greater overall coherence in rule-design, treaty use and policy making and thus offer a better balance between the rights and obligations of international investors and host states.

Addressing climate change under preferential trade agreements: Towards alignment of carbon standards under the Transatlantic Trade and Investment Partnership

With its wide coverage of economic spheres and the variety of trade and investment measures currently under negotiation, the Transatlantic Trade and Investment Partnership opens windows of opportunity for advancing action on climate change. We examine possible avenues and international trade law implications for an alignment of carbon-related standards between the EU and the US. We compare EU and US carbon emissions standards for cars and argue that negotiators should strive for a mutual recognition of their equivalence for a transitional period, while pursuing the goal of full harmonization at the level of the highest standards of two parties at some date in the future. This could be a way to balance between economic and environmental interests and harness economic incentives for the benefit of climate.