US Antidumping Petitions and Revealed Comparative Advantage of Shrimp Exporting Countries

The paper explores the trade competitiveness of seven major shrimp exporting countries, namely Vietnam, China, Thailand, Ecuador, India, Indonesia and Mexico, to the USA. Specifically, we investigate whether the United States (US) antidumping petitions impact upon the bilateral revealed comparative advantage (RCA) indexes for each of the seven shrimp exporting countries with the USA. Monthly data from January 2003 to December 2014 and the panel data model are used to examine the determinants of the RCA for the shrimp exporting countries. The empirical results show the shrimp exporting countries have superior competitiveness against the shrimp market in the USA. Moreover, the RCA indexes are significantly negatively influenced by shrimp prices, and are positively affected by US income per capita. However, the EMS (Early Mortality Syndrome) shrimp disease, domestic US shrimp quantity, exchange rate, and US antidumping laws are found to have no significant impacts on the RCA indexes. In terms of policy implications, the USA should try to reduce production costs of shrimp in the US market instead of imposing antidumping petitions, and the shrimp exporting countries should maintain their comparative advantage and diversify into new markets.

A tale of two regions:comparative versus competitive approaches to economic restructuring

In April 2004 Mitsubishi announced the closure of its Lonsdale plant in South Australia. Almost a year later, MG Rover went into administration, resulting in the immediate closure of its Longbridge plant just outside Birmingham, England. Both closures were expected to have a considerable impact on their regional economies through the loss of employment and associated economic activity. However, governments in Australia and England responded in significantly different ways: in England the focus was on competitive advantage through the modernisation of the auto cluster and the diversification of the regional economy into new, high-technology industries. In Australia, the national and state governments introduced policy responses based on the pursuit of comparative advantage. This paper compares and contrasts the two sets of government responses and examines the capacity of each to deliver long-term benefits to their affected communities.

Trade and environment: Evidence from China's manufacturing sector

This paper focusing on the Chinese manufacturing sector assesses the environmental impact of trade liberalization in China. The results show that China's experience with the trade liberalization-environment nexus is consistent with international evidence. On one hand, trade liberalization has had various positive effects on the environment. Firstly, it promoted specialization in areas of comparative advantage, which, in general, included industries that contributed less to environmental degradation. Secondly, it allowed China to access and adopt the best international practices in pollution abatement technology. Thirdly, it enabled China to transfer environmental costs to other countries by importing intermediate products whose production contributed to environmental degradation. On the other hand, these positive effects were overwhelmed by a negative scale effect, which was the result of a huge increase in the demand for Chinese exports. The paper concludes that if China is to prevent pollution from reaching a critical threshold, environmental regulations need to be tightened. Copyright (C) 2002 John Wiley & Sons, Ltd and ERP Environment.

Comércio bilateral Portugal - Brasil

Dissertação apresentada ao Instituto Superior de Contabilidade e Administração do Porto para obtenção do Grau de Mestre em Empreendedorismo e Internacionalização Orientadora: Professora Doutora Celsa Maria de Carvalho Machado

Structural transformation and specialization patterns in the product space: assessing China and India

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Structural transformation in the product space: Patterns and implications

Product fundamentals are essential in explaining heterogeneity in the product space. The scope for adapting and transferring capabilities into the production of different goods determines the speed and intensity of the structural transformation process and entails dissimilar development opportunities for nations. Future specialization patterns become then partly determined by the current network of products’ relatedness. Building on previous literature, this paper explicitly compares methodological concepts of product connectivity to conclude in favor of the density measure we propose combined with the Revealed Relatedness Index (RRI) approach presented by Freitas and Salvado (2011). Overall, RRI specifications displayed more consistent behavior when different time horizons are equated.

The Fair Trade movement: an economic perspective

Fair Trade (FT) products such as coffee and textiles are becoming increasingly popular with altruistic consumers all over the world. This paper seeks to understand the economic effects of this grassroots movement which directly links ethically-minded consumers in industrialised countries with marginalised producers in developing economies. We extend the Ricardian trade model and introduce a FT sector in developing South that offers a fair wage – the FT premium. There are indeed positive welfare effects from FT but those come at the expense of rising inequalities within South which are in turn a rational by-product of FT. The degree of inequalities depends on the specifics of the cooperative structures in the FT sector. Given the rigidities and inequalities FT introduces and rests upon, this form of alternative trade appears to be only sustainable as niche movement.

Financial Markets and Real Ecinomy: Four Essays in International Trade

Financial markets play an important role in an economy performing various functions like mobilizing and pooling savings, producing information about investment opportunities, screening and monitoring investments, implementation of corporate governance, diversification and management of risk. These functions influence saving rates, investment decisions, technological innovation and, therefore, have important implications for welfare. In my PhD dissertation I examine the interplay of financial and product markets by looking at different channels through which financial markets may influence an economy.My dissertation consists of four chapters. The first chapter is a co-authored work with Martin Strieborny, a PhD student from the University of Lausanne. The second chapter is a co-authored work with Melise Jaud, a PhD student from the Paris School of Economics. The third chapter is co-authored with both Melise Jaud and Martin Strieborny. The last chapter of my PhD dissertation is a single author paper.Chapter 1 of my PhD thesis analyzes the effect of financial development on growth of contract intensive industries. These industries intensively use intermediate inputs that neither can be sold on organized exchange, nor are reference-priced (Levchenko, 2007; Nunn, 2007). A typical example of a contract intensive industry would be an industry where an upstream supplier has to make investments in order to customize a product for needs of a downstream buyer. After the investment is made and the product is adjusted, the buyer may refuse to meet a commitment and trigger ex post renegotiation. Since the product is customized to the buyer's needs, the supplier cannot sell the product to a different buyer at the original price. This is referred in the literature as the holdup problem. As a consequence, the individually rational suppliers will underinvest into relationship-specific assets, hurting the downstream firms with negative consequences for aggregate growth. The standard way to mitigate the hold up problem is to write a binding contract and to rely on the legal enforcement by the state. However, even the most effective contract enforcement might fail to protect the supplier in tough times when the buyer lacks a reliable source of external financing. This suggests the potential role of financial intermediaries, banks in particular, in mitigating the incomplete contract problem. First, financial products like letters of credit and letters of guarantee can substantially decrease a risk and transaction costs of parties. Second, a bank loan can serve as a signal about a buyer's true financial situation, an upstream firm will be more willing undertake relationship-specific investment knowing that the business partner is creditworthy and will abstain from myopic behavior (Fama, 1985; von Thadden, 1995). Therefore, a well-developed financial (especially banking) system should disproportionately benefit contract intensive industries.The empirical test confirms this hypothesis. Indeed, contract intensive industries seem to grow faster in countries with a well developed financial system. Furthermore, this effect comes from a more developed banking sector rather than from a deeper stock market. These results are reaffirmed examining the effect of US bank deregulation on the growth of contract intensive industries in different states. Beyond an overall pro-growth effect, the bank deregulation seems to disproportionately benefit the industries requiring relationship-specific investments from their suppliers.Chapter 2 of my PhD focuses on the role of the financial sector in promoting exports of developing countries. In particular, it investigates how credit constraints affect the ability of firms operating in agri-food sectors of developing countries to keep exporting to foreign markets.Trade in high-value agri-food products from developing countries has expanded enormously over the last two decades offering opportunities for development. However, trade in agri-food is governed by a growing array of standards. Sanitary and Phytosanitary standards (SPS) and technical regulations impose additional sunk, fixed and operating costs along the firms' export life. Such costs may be detrimental to firms' survival, "pricing out" producers that cannot comply. The existence of these costs suggests a potential role of credit constraints in shaping the duration of trade relationships on foreign markets. A well-developed financial system provides the funds to exporters necessary to adjust production processes in order to meet quality and quantity requirements in foreign markets and to maintain long-standing trade relationships. The products with higher needs for financing should benefit the most from a well functioning financial system. This differential effect calls for a difference-in-difference approach initially proposed by Rajan and Zingales (1998). As a proxy for demand for financing of agri-food products, the sanitary risk index developed by Jaud et al. (2009) is used. The empirical literature on standards and norms show high costs of compliance, both variable and fixed, for high-value food products (Garcia-Martinez and Poole, 2004; Maskus et al., 2005). The sanitary risk index reflects the propensity of products to fail health and safety controls on the European Union (EU) market. Given the high costs of compliance, the sanitary risk index captures the demand for external financing to comply with such regulations.The prediction is empirically tested examining the export survival of different agri-food products from firms operating in Ghana, Mali, Malawi, Senegal and Tanzania. The results suggest that agri-food products that require more financing to keep up with food safety regulation of the destination market, indeed sustain longer in foreign market, when they are exported from countries with better developed financial markets.Chapter 3 analyzes the link between financial markets and efficiency of resource allocation in an economy. Producing and exporting products inconsistent with a country's factor endowments constitutes a serious misallocation of funds, which undermines competitiveness of the economy and inhibits its long term growth. In this chapter, inefficient exporting patterns are analyzed through the lens of the agency theories from the corporate finance literature. Managers may pursue projects with negative net present values because their perquisites or even their job might depend on them. Exporting activities are particularly prone to this problem. Business related to foreign markets involves both high levels of additional spending and strong incentives for managers to overinvest. Rational managers might have incentives to push for exports that use country's scarce factors which is suboptimal from a social point of view. Export subsidies might further skew the incentives towards inefficient exporting. Management can divert the export subsidies into investments promoting inefficient exporting.Corporate finance literature stresses the disciplining role of outside debt in counteracting the internal pressures to divert such "free cash flow" into unprofitable investments. Managers can lose both their reputation and the control of "their" firm if the unpaid external debt triggers a bankruptcy procedure. The threat of possible failure to satisfy debt service payments pushes the managers toward an efficient use of available resources (Jensen, 1986; Stulz, 1990; Hart and Moore, 1995). The main sources of debt financing in the most countries are banks. The disciplining role of banks might be especially important in the countries suffering from insufficient judicial quality. Banks, in pursuing their rights, rely on comparatively simple legal interventions that can be implemented even by mediocre courts. In addition to their disciplining role, banks can promote efficient exporting patterns in a more direct way by relaxing credit constraints of producers, through screening, identifying and investing in the most profitable investment projects. Therefore, a well-developed domestic financial system, and particular banking system, would help to push a country's exports towards products congruent with its comparative advantage.This prediction is tested looking at the survival of different product categories exported to US market. Products are identified according to the Euclidian distance between their revealed factor intensity and the country's factor endowments. The results suggest that products suffering from a comparative disadvantage (labour-intensive products from capital-abundant countries) survive less on the competitive US market. This pattern is stronger if the exporting country has a well-developed banking system. Thus, a strong banking sector promotes exports consistent with a country comparative advantage.Chapter 4 of my PhD thesis further examines the role of financial markets in fostering efficient resource allocation in an economy. In particular, the allocative efficiency hypothesis is investigated in the context of equity market liberalization.Many empirical studies document a positive and significant effect of financial liberalization on growth (Levchenko et al. 2009; Quinn and Toyoda 2009; Bekaert et al., 2005). However, the decrease in the cost of capital and the associated growth in investment appears rather modest in comparison to the large GDP growth effect (Bekaert and Harvey, 2005; Henry, 2000, 2003). Therefore, financial liberalization may have a positive impact on growth through its effect on the allocation of funds across firms and sectors.Free access to international capital markets allows the largest and most profitable domestic firms to borrow funds in foreign markets (Rajan and Zingales, 2003). As domestic banks loose some of their best clients, they reoptimize their lending practices seeking new clients among small and younger industrial firms. These firms are likely to be more risky than large and established companies. Screening of customers becomes prevalent as the return to screening rises. Banks, ceteris paribus, tend to focus on firms operating in comparative-advantage sectors because they are better risks. Firms in comparative-disadvantage sectors finding it harder to finance their entry into or survival in export markets either exit or refrain from entering export markets. On aggregate, one should therefore expect to see less entry, more exit, and shorter survival on export markets in those sectors after financial liberalization.The paper investigates the effect of financial liberalization on a country's export pattern by comparing the dynamics of entry and exit of different products in a country export portfolio before and after financial liberalization.The results suggest that products that lie far from the country's comparative advantage set tend to disappear relatively faster from the country's export portfolio following the liberalization of financial markets. In other words, financial liberalization tends to rebalance the composition of a country's export portfolio towards the products that intensively use the economy's abundant factors.

An agency-oriented model to explain vine-growing specialization in the province of Barcelona (Catalonia, Spain) in the mid-nineteenth century

[cat] En aquest treball presentem un model per explicar el procés d’especialització vitícola assolit als municipis de la província de Barcelona, a mitjans del s. XIX,que cerca entendre com va sorgir històricament un avantatge comparatiu fruit d’un procés que esdevindria un dels punts de partida del procés d’industrialització a Catalunya. Els resultats confirmen els papers jugats pel impuls “Boserupià” de la població en un context d’intensificació de l’ús de la terra, i d’un impuls del mercat “Smithià” en un context d’expansió de la demanda per part de les economies atlàntiques. També es posa de manifest la importància de les dotacions agro-ecològiques i les condicions socioinstitucionals relacionades amb la desigualtat d’ingrés. La difusió de la vinya donà com a resultat unes comunitats rurals menys desiguals fins al 1820, tot i que aquesta desigualtat augmentà de nou a partir d'aleshores.

Looking for orders of magnitude : five essays in trade and the environment and economic geography

General Summary Although the chapters of this thesis address a variety of issues, the principal aim is common: test economic ideas in an international economic context. The intention has been to supply empirical findings using the largest suitable data sets and making use of the most appropriate empirical techniques. This thesis can roughly be divided into two parts: the first one, corresponding to the first two chapters, investigates the link between trade and the environment, the second one, the last three chapters, is related to economic geography issues. Environmental problems are omnipresent in the daily press nowadays and one of the arguments put forward is that globalisation causes severe environmental problems through the reallocation of investments and production to countries with less stringent environmental regulations. A measure of the amplitude of this undesirable effect is provided in the first part. The third and the fourth chapters explore the productivity effects of agglomeration. The computed spillover effects between different sectors indicate how cluster-formation might be productivity enhancing. The last chapter is not about how to better understand the world but how to measure it and it was just a great pleasure to work on it. "The Economist" writes every week about the impressive population and economic growth observed in China and India, and everybody agrees that the world's center of gravity has shifted. But by how much and how fast did it shift? An answer is given in the last part, which proposes a global measure for the location of world production and allows to visualize our results in Google Earth. A short summary of each of the five chapters is provided below. The first chapter, entitled "Unraveling the World-Wide Pollution-Haven Effect" investigates the relative strength of the pollution haven effect (PH, comparative advantage in dirty products due to differences in environmental regulation) and the factor endowment effect (FE, comparative advantage in dirty, capital intensive products due to differences in endowments). We compute the pollution content of imports using the IPPS coefficients (for three pollutants, namely biological oxygen demand, sulphur dioxide and toxic pollution intensity for all manufacturing sectors) provided by the World Bank and use a gravity-type framework to isolate the two above mentioned effects. Our study covers 48 countries that can be classified into 29 Southern and 19 Northern countries and uses the lead content of gasoline as proxy for environmental stringency. For North-South trade we find significant PH and FE effects going in the expected, opposite directions and being of similar magnitude. However, when looking at world trade, the effects become very small because of the high North-North trade share, where we have no a priori expectations about the signs of these effects. Therefore popular fears about the trade effects of differences in environmental regulations might by exaggerated. The second chapter is entitled "Is trade bad for the Environment? Decomposing worldwide SO2 emissions, 1990-2000". First we construct a novel and large database containing reasonable estimates of SO2 emission intensities per unit labor that vary across countries, periods and manufacturing sectors. Then we use these original data (covering 31 developed and 31 developing countries) to decompose the worldwide SO2 emissions into the three well known dynamic effects (scale, technique and composition effect). We find that the positive scale (+9,5%) and the negative technique (-12.5%) effect are the main driving forces of emission changes. Composition effects between countries and sectors are smaller, both negative and of similar magnitude (-3.5% each). Given that trade matters via the composition effects this means that trade reduces total emissions. We next construct, in a first experiment, a hypothetical world where no trade happens, i.e. each country produces its imports at home and does no longer produce its exports. The difference between the actual and this no-trade world allows us (under the omission of price effects) to compute a static first-order trade effect. The latter now increases total world emissions because it allows, on average, dirty countries to specialize in dirty products. However, this effect is smaller (3.5%) in 2000 than in 1990 (10%), in line with the negative dynamic composition effect identified in the previous exercise. We then propose a second experiment, comparing effective emissions with the maximum or minimum possible level of SO2 emissions. These hypothetical levels of emissions are obtained by reallocating labour accordingly across sectors within each country (under the country-employment and the world industry-production constraints). Using linear programming techniques, we show that emissions are reduced by 90% with respect to the worst case, but that they could still be reduced further by another 80% if emissions were to be minimized. The findings from this chapter go together with those from chapter one in the sense that trade-induced composition effect do not seem to be the main source of pollution, at least in the recent past. Going now to the economic geography part of this thesis, the third chapter, entitled "A Dynamic Model with Sectoral Agglomeration Effects" consists of a short note that derives the theoretical model estimated in the fourth chapter. The derivation is directly based on the multi-regional framework by Ciccone (2002) but extends it in order to include sectoral disaggregation and a temporal dimension. This allows us formally to write present productivity as a function of past productivity and other contemporaneous and past control variables. The fourth chapter entitled "Sectoral Agglomeration Effects in a Panel of European Regions" takes the final equation derived in chapter three to the data. We investigate the empirical link between density and labour productivity based on regional data (245 NUTS-2 regions over the period 1980-2003). Using dynamic panel techniques allows us to control for the possible endogeneity of density and for region specific effects. We find a positive long run elasticity of density with respect to labour productivity of about 13%. When using data at the sectoral level it seems that positive cross-sector and negative own-sector externalities are present in manufacturing while financial services display strong positive own-sector effects. The fifth and last chapter entitled "Is the World's Economic Center of Gravity Already in Asia?" computes the world economic, demographic and geographic center of gravity for 1975-2004 and compares them. Based on data for the largest cities in the world and using the physical concept of center of mass, we find that the world's economic center of gravity is still located in Europe, even though there is a clear shift towards Asia. To sum up, this thesis makes three main contributions. First, it provides new estimates of orders of magnitudes for the role of trade in the globalisation and environment debate. Second, it computes reliable and disaggregated elasticities for the effect of density on labour productivity in European regions. Third, it allows us, in a geometrically rigorous way, to track the path of the world's economic center of gravity.

An agency-oriented model to explain vine-growing specialization in the province of Barcelona (Catalonia, Spain) in the mid-nineteenth century

[cat] En aquest treball presentem un model per explicar el procés d’especialització vitícola assolit als municipis de la província de Barcelona, a mitjans del s. XIX,que cerca entendre com va sorgir històricament un avantatge comparatiu fruit d’un procés que esdevindria un dels punts de partida del procés d’industrialització a Catalunya. Els resultats confirmen els papers jugats pel impuls “Boserupià” de la població en un context d’intensificació de l’ús de la terra, i d’un impuls del mercat “Smithià” en un context d’expansió de la demanda per part de les economies atlàntiques. També es posa de manifest la importància de les dotacions agro-ecològiques i les condicions socioinstitucionals relacionades amb la desigualtat d’ingrés. La difusió de la vinya donà com a resultat unes comunitats rurals menys desiguals fins al 1820, tot i que aquesta desigualtat augmentà de nou a partir d'aleshores.

How the West "invented" fertility restriction

We analyze the rise of the first socio-economic institution in history that limited fertility ? long before theDemographic Transition. The "European Marriage Pattern" (EMP) raised the marriage age of women andensured that many remained celibate, thereby reducing childbirths by up to one third between the 14thand 18th century. To explain the rise of EMP we build a two-sector model of agricultural production ?grain and livestock. Women have a comparative advantage in the latter because plow agriculture requiresphysical strength. After the Black Death in 1348-50, land abundance triggered a shift towards the landintensivepastoral sector, improving female employment prospects. Because women working in animalhusbandry had to remain unmarried, more farm service spelled later marriages. The resulting reductionin fertility led to a new Malthusian steady state with lower population pressure and higher wages. Themodel can thus help to explain the divergence in income per capita between Europe and Asia long beforethe Industrial Revolution. Using detailed data from England after 1290, we provide strong evidence forour mechanism. Where pastoral agriculture dominated, more women worked as servants, and marriageoccurred markedly later. Overall, we estimate that pastoral farming raised female ages at first marriage bymore than 4 years.

EU:n ja Kiinan välisen kaupan kehitys

Työmme tavoitteena on analysoida Kiinan ja EU:n keskinäisen kaupan kasvua viimeisinä vuosikymmeninä ja lähitulevaisuudessa. Lisäksi tutkimme kauppaa ja sen rakennetta molemmista näkökulmista, jotta voisimme havaita molemmille osapuolille saavutettavat hyödyt, haitat ja tulevaisuuden mahdollisuudet. Työssä pyrittiin käyttämään lähteenä aiheeseen liittyvää kirjallisuutta ja tuoreita artikkeleita. Maiden välisen kaupan kasvu perustuu suuresti Kiinan talouden uudistusohjelmaan, jonka ansiosta Kiina avautui huomattavasti kansainväliselle liiketoiminnalle. Suhteellisen edun teorian mukaisesti tuotanto alkoi siirtyä Kiinaan yhä enemmän, ja samalla Kiinan talous lähti huimaan kasvuun. Kiina on viime vuosikymmenen aikana noussut EU:n tärkeimmäksi tuontimaaksi, ja tulevaisuudessa Kiinan vienti tulee lisääntymään entisestään. Joidenkin arvioiden mukaan Kiina tulee tulevaisuudessa ottamaan paikan maailman suurimpana talousmaana. Tärkeimmät kahdenkeskeiseen kaupankäyntiin vaikuttavat seikat ovat Kiinan valuutan aliarvostus ja tuontirajoitukset. Kaupan rakenteeseen vaikuttaa merkittävästi Kiina ja EU:n taloudellisten suhteellisten etujen eroavaisuudet.

The impact of FTAs on MENA trade in agricultural and industrial products

This paper analyses the impact of Free Trade Agreements (FTAs) on Middle East and North African Countries (MENA) trade for the period 1994-2010. The analysis distinguishes between industrial and agricultural trade to take into account the different liberalisation schedules. An augmented gravity model is estimated using up-to-date panel data techniques to control for all time-invariant bilateral factors that influence bilateral trade as well as for the so-called multilateral resistance factors. We also control for the endogeneity of the agreements and test for self-selection bias due to the presence of zero trade in our sample. The main findings indicate that North-South-FTAs and South-South- FTAs have a differential impact in terms of increasing trade in MENA countries, with the former being more beneficial in terms of exports for MENA countries, but both showing greater global market integration. We also find that FTAs that include agricultural products, in which MENA countries have a clear comparative advantage, have more favourable effects for these countries than those only including industrial products. JEL code: F10, F15

EVALUATION OF TECHNOLOGICAL INTENSITY OF EXPORTS IN THE FORESTRY SECTOR

ABSTRACT One of the fastest growing sectors in the domestic industry is the forestry, which has contributed significantly to economic development, job creation, income taxes, putting Brazil in a prominent position in the world market. This paper analyzes the evolution of the technological intensity of 12 main products exported by the sector, from 2000 to 2011. For that, utilizes an indicator called PRODY, which allows classifying different products according to their technological intensity or income content and considers the GDP per capita of exporting countries of each product, weighted by its revealed comparative advantage. It can be seen by the results, a continuous growth in all products' technology indicators and their decomposition into income effects, comparative advantage and joint effects, allowed to verify the main causes of this growth. Products with lower PRODY values are those that presented a higher evolution during the period studied. Products of higher processing, and those from pulp and paper industry, had greater technological advances, thanks to a joint effect, while the ones of lower processing, had a technological improvement due to the increase in GDP per capita in exporting countries. Sawn wood was the standout product, being the only one who proved to be dependent of comparative advantage effect, confirming that this industry has been reinventing itself and incorporating, in fact, more technology. This study revealed the importance of technological intensification to generate comparative advantage and be able to stand against international competition.