Essays on International trade and economic growth

At present, we are witnessing globalization as a truly worldwide phenomenon. Trade agreements among differing countries, a reduction in trade costs, the mobility of production factors, the free flow of information and so on are all proof of the present day era of globalization. Countries are trading with one another more and more every day and the effects of international trade on economies represent a central discussion in all economic spheres. In spite of increasing trade around the world and the promotion of globalization by multilateral organisms such as WTO and IMF, the effects of international trade are not yet clear. Economics literature concerning the effects of international trade on economic growth and welfare remains ambiguous in terms of both theoretical models and empirical research. The present thesis tries to contribute to the theoretical debate surrounding the effects of dynamic international trade, focusing in particular on the implications for economic growth, welfare and changes in the preferences of individuals.

Economic shocks and crime: evidence from the crash of ponzi schemes

In November 2008, Colombian authorities dismantled a network of Ponzi schemes, making hundreds of thousands of investors lose tens of millions of dollars throughout the country. Using original data on the geographical incidence of the Ponzi schemes, this paper estimates the impact of their break down on crime. We find that the crash of Ponzi schemes differentially exacerbated crime in affected districts. Confirming the intuition of the standard economic model of crime, this effect is only present in places with relatively weak judicial and law enforcement institutions, and with little access to consumption smoothing mechanisms such as microcredit. In addition, we show that, with the exception of economically-motivated felonies such as robbery, violent crime is not affected by the negative shock.

The effects of information and communication technologies on the banking sector and the payments system

This dissertation studies the effects of Information and Communication Technologies (ICT) on the banking sector and the payments system. It provides insight into how technology-induced changes occur, by exploring both the nature and scope of main technology innovations and evidencing their economic implications for banks and payment systems. Some parts in the dissertation are descriptive. They summarise the main technological developments in the field of finance and link them to economic policies. These parts are complemented with sections of the study that focus on assessing the extent of technology application to banking and payment activities. Finally, it includes also some work which borrows from the economic literature on banking. The need for an interdisciplinary approach arises from the complexity of the topic and the rapid path of change to which it is subject. The first chapter provides an overview of the influence of developments in ICT on the evolution of financial services and international capital flows. We include main indicators and discuss innovation in the financial sector, exchange rates and international capital flows. The chapter concludes with impact analysis and policy options regarding the international financial architecture, some monetary policy issues and the role of international institutions. The second chapter is a technology assessment study that focuses on the relationship between technology and money. The application of technology to payments systems is transforming the way we use money and, in some instances, is blurring the definition of what constitutes money. This chapter surveys the developments in electronic forms of payment and their relationship to the banking system. It also analyses the challenges posed by electronic money for regulators and policy makers, and in particular the opportunities created by two simultaneous processes: the Economic and Monetary Union and the increasing use of electronic payment instruments. The third chapter deals with the implications of developments in ICT on relationship banking. The financial intermediation literature explains relationship banking as a type of financial intermediation characterised by proprietary information and multiple interactions with customers. This form of banking is important for the financing of small and medium-sized enterprises. We discuss the effects of ICT on the banking sector as a whole and then apply these developments to the case of relationship banking. The fourth chapter is an empirical study of the effects of technology on the banking business, using a sample of data from the Spanish banking industry. The design of the study is based on some of the events described in the previous chapters, and also draws from the economic literature on banking. The study shows that developments in information management have differential effects on wholesale and retail banking activities. Finally, the last chapter is a technology assessment study on electronic payments systems in Spain and the European Union. It contains an analysis of existing payment systems and ongoing or planned initiatives in Spain. It forms part of a broader project comprising a series of country-specific analyses covering ten European countries. The main issues raised across the countries serve as the starting point to discuss implications of the development of electronic money for regulation and policies, and in particular, for monetary-policy making.

Extractivism, economic diversification and prospects for sustainable development in Ecuador

The objectives of this paper are first, evaluating economic, social and environmental effects on oil extraction in Ecuador during the last 41 years, and second, discussing prospects to achieving a sustainable and equitable development path in the future, in the context of declining oil reserves. The current government is pursuing an extractivist policy, based on expanding oil extraction in formerly unexploited fields -including those inside the Yasuni National Park- and starting largescale mining exploitation. Two future options will be evaluated, first, an expansion of extractive activities, and second an alternative based on conservation, with sustainable use of natural resources (e.g. ecotourism, agroforestry, bio-knowledge), without expansion of oil field expansion and mining.

An ex-ante evaluation of the economic impact of Bt cotton adoption by spanish farmers facing the EU cotton sector reform

Cotton production in the European Union (EU) is limited to areas of Greece and Southern Spain (Andalusia). The 2004 reform of the EU cotton policy severely affected the profitability of the crop. In this article we analyze how the introduction of genetically modified (GM), insect-resistant cotton varieties (Bt cotton) might help EU cotton farmers to increase profitability and therefore face the cotton policy reform. We first study farmers’ attitudes toward adoption of Bt cotton varieties through a survey conducted in Andalusia (Southern Spain). The results show a positive attitude of Andalusian cotton farmers toward the Bt cotton varieties. Second, we perform an ex-ante analysis of the effects of introducing Bt cotton in Andalusia. Finally, we integrate the analysis of the effects of Bt cotton with the analysis of the EU cotton reform. Our results show that despite the significant economic benefits of Bt cotton, the current policy reform is likely to jeopardize the profitability of cotton production in the EU.

Biosecurity in agriculture: an economic analysis of coexistence of professional and hobby production

One component of biosecurity is protection against invasive alien species, which are one of the most important threats worldwide to native biodiversity and economic profitability in various sectors, including agriculture. However, agricultural producers are not homogeneous. They may have different objectives and priorities, use different technologies, and occupy heterogeneous parcels of land. If the producers differ in terms of their attitude towards invasive pests and the damages they cause, there are probably external effects in the form of pest spread impacts and subsequent damages caused. We study such impacts in the case of two producer types: profit-seeking professional producers and utility-seeking hobby producers. We show that the hobby producer, having first set a breeding ground for the pest, under-invests in pest control. We also discuss potential policy instruments to correct this market failure and highlight the importance of considering different stakeholders and their heterogeneous incentives when designing policies to control invasive alien species.

Economic impact of Turnip mosaic virus, Cauliflower mosaic virus and Beet mosaic virus in three Kenyan vegetables

Screenhouse experiments conducted in Kenya showed that inoculation of cabbage seedlings with Turnip mosaic virus (TuMV), either alone, or in combination with Cauliflower mosaic virus (CaMV), reduced the number and weight of marketable harvested heads. When viruses were inoculated simultaneously, 25% of cabbage heads were non-marketable, representing 20-fold loss compared with control. By contrast, inoculation with CaMV alone had insignificant effects on cabbage yield. This suggests that TuMV is the more detrimental of these pathogens, and its management should be a priority. Early exposure to TuMV produced cabbages that were 50% lighter than non-infected plants, but later infection was less damaging suggesting that controlling virus infection at the seedling stage is more important. TuMV was far less damaging to kale than it was to cabbage; although high proportions of TuMV-inoculated kale plants showed symptoms (> 90%), the marketability and quality of leaves were not significantly reduced, and no clear relationship existed between timing of infection and subsequent crop losses. Early inoculation of Swiss chard with Beet mosaic virus (BtMV) significantly impaired leaf quality (similar to 50% reduction in marketable leaf production), but the impact of disease was greatest in plants that had been inoculated at maturity, where average leaf losses were two and a half times those recorded in virus-free plants. Disease-management of BtMV in Swiss chard is important, therefore, not only at the seedling stage, but particularly when plants are transplanted from nursery to field.

The effects of minimal tillage, contour cultivation, in-field vegetative barriers and crop residues on phosphorus and sediment yields

Runoff, sediment, total phosphorus and total dissolved phosphorus losses in overland flow were measured for two years on unbounded plots cropped with wheat and oats. Half of the field was cultivated with minimum tillage (shallow tillage with a tine cultivator) and half was conventionally ploughed. Within each cultivation treatment there were different treatment areas (TAs). In the first year of the experiment, one TA was cultivated up and down the slope, one TA was cultivated on the contour, with a beetle bank acting as a vegetative barrier partway up the slope, and one had a mixed direction cultivation treatment, with cultivation and drilling conducted up and down the slope and all subsequent operations conducted on the contour. In the second year, this mixed treatment was replaced with contour cultivation. Results showed no significant reduction in runoff, sediment losses or total phosphorus losses from minimum tillage when compared to the conventional plough treatment, but there were increased losses of total dissolved phosphorus with minimum tillage. The mixed direction cultivation treatment increased surface runoff and losses of sediment and phosphorus. Increasing surface roughness with contour cultivation reduced surface runoff compared to up and down slope cultivation in both the plough and minimum tillage treatment areas, but this trend was not significant. Sediment and phosphorus losses in the contour cultivation treatment followed a very similar pattern to runoff. Combining contour cultivation with a vegetative barrier in the form of a beetle bank to reduce slope length resulted in a non-significant reduction in surface runoff, sediment and total phosphorus when compared to up and down slope cultivation, but there was a clear trend towards reduced losses. However, the addition of a beetle bank did not provide a significant reduction in runoff, sediment losses or total phosphorus losses when compared to contour cultivation, suggesting only a marginal additional benefit. The economic implications for farmers of the different treatment options are investigated in order to assess their suitability for implementation at a field scale.

The economic viability and potential of a novel poultry agroforestry system

Investigating agroforestry systems that incorporate poultry is warranted in Northern Europe as they may offer benefits including: improved welfare and use of range; reduced feed costs; price premia on products; reduced payback periods for forests; and, greater returns on investment. Free-range egg production accounts for 27% of the United Kingdom egg market and demand for outdoor broilers is increasing. No research has been conducted recently on the economic viability of agroforestry systems with poultry. An economic model was constructed to: assess economic viability of a broiler agroforestry system; and, investigate the sensitivity of economic performance to key factors and interactions, and identify those which warrant attention in research and management. The system modelled is a commercial trial established in Southern England in 2002 where deciduous trees were planted and broilers reared in six- or nine-week periods. The model uses Monte Carlo simulation and financial performance analyses run for a 120-year period. An Internal Rate of Return (IRR) of 15.5% is predicted for the six-week system which remains viable under a 'worst case' scenario (IRR of 12.6%). Factors which affect financial performance most (decreasing in magnitude) are prices achieved for broilers, costs of brooding houses, chicks, arks, feed and timber prices. The main anticipated effects of biological interactions on financial performance (increased ranging on feed conversion and excess nutrient supply on tree health) were not supported by analysis. Further research is particularly warranted on the welfare benefits offered by the tree component and its relation to price premia.

Effects of UV-blocking films on the dispersal behavior of Encarsia formosa (Hymenoptera : Aphelinidae)

The parasitoid Encarsia formosa Gahan (Hymenoptera: Aphelinidae) has been used successfully for the control of Trialeurodes vaporariorum (Westwood) (Homoptera: Aleyrodidae). The development of UV-blocking plastic films has added a new component to future integrated pest management systems by disrupting insect pest infestation when UV light is excluded. Because both T. vaporariorum and E. formosa are reported to have similar spectral efficiency, there was a need to identify the impact of UV-blocking films on the dispersal behavior of both the pest and the natural enemy. In field studies, using choice-chamber experiments, E. formosa showed some preference to disperse into compartments where less UV light was blocked. However, further studies indicated that the effect was primarily attributable to the different light diffusion properties of the films tested. Thus, unlike its whitefly host, when the UV-absorbing properties of the films were similar, but the light diffusion properties differed, E.formosa adults preferred to disperse into compartments clad with films that had high light diffusion properties. When the plastic films differed most in their UV-absorbing capacity and had no light-diffusion capability, the initial dispersal of E. formosa between treatments was similar, although a small preference toward the environment with UV light was observed over time. When parasitoid dispersal was measured 3 h after release, more parasitoids were found on plants, suggesting that the parasitoids would search plants for whitefly hosts, even in a UV-blocked light environment. The potential for the integration of UV-blocking films with E. formosa in an advanced whitefly management system is discussed.

Soil disturbed using a strip tillage implement on a range of soil types and the effects on sugar beet establishment

The area of soil disturbed using a single tine is well documented. However, modern strip tillage implements using a tine and disc design have not been assessed in the UK or in mainland Europe. Using a strip tillage implement has potential benefits for European agriculture where economic returns and sustainability are key issues. Using a strip tillage system a narrow zone is cultivated leaving most of the straw residue on the soil surface. Small field plot experiments were undertaken on three soil types and the operating parameters of forward speed, tine depth and tine design were investigated together with measurements of seedbed tilth and crop emergence. The type of tine used was found to be the primary factor in achieving the required volume of disturbance within a narrow zone whilst maintaining an area of undisturbed soil with straw residue on the surface. The winged tine produced greater disturbance at a given depth compared with the knife tine. Increasing forward speed did not consistently increase the volume of disturbance. In a sandy clay loam the tilth created and emergence of sugar beet by strip tillage and ploughing were similar but on a sandy loam the strip tillage treatments generally gave a finer tilth but poorer emergence particularly at greater working depth.

Fibre and effects on probiotics (the prebiotic concept)

The burden (economic and medicinal) of acute and chronic gut disorders continues to increase. As efficient therapies are few, attention has turned towards the use of so-called functional foods to mediate against gut disorder. These target particular genera of gut bacteria seen as beneficial, e.g. bifidobacteria, lactobacilli. The use of products containing live microbial species (probiotics) has a long history of use in humans and many trials have been reported as 'positive'. Taking the view that positive components of the gut flora already exist in the intestinal tract, the prebiotic concept has been developed. Here, dietary carbohydrates have a selective metabolism within the gut flora thereby shifting the community towards a more advantageous structure. Conventional fibres like pectins, cellulose, etc. are not selectively metabolised by gut bacteria. However, certain oligosaccharides do have this capability. Most research has been conducted with fructooligosaccharides, like inulin, which have a powerful bifidogenic effect. Trials are ongoing to determine the clinical benefits of prebiotic use. Intestinal disorders like ulcerative colitis, gastroenteritis and irritable bowel syndrome are particular targets. (c) 2004 Elsevier Ltd. All rights reserved.

Dynamics of brand competition: Effects of unobserved social networks

Brand competition is modelled using an agent based approach in order to examine the long run dynamics of market structure and brand characteristics. A repeated game is designed where myopic firms choose strategies based on beliefs about their rivals and consumers. Consumers are heterogeneous and can observe neighbour behaviour through social networks. Although firms do not observe them, the social networks have a significant impact on the emerging market structure. Presence of networks tends to polarize market share and leads to higher volatility in brands. Yet convergence in brand characteristics usually happens whenever the market reaches a steady state. Scale-free networks accentuate the polarization and volatility more than small world or random networks. Unilateral innovations are less frequent under social networks.

Resilience planning, economic change and the politics of post-recession development in London and Hong Kong

For much of the 1990s and 2000s, the emphasis of urban policy in many global cities was on managing and mitigating the social and environmental effects of rapid economic growth. The credit crunch of 2008 and the subsequent recession have undermined some of the core assumptions on which such policies were based. It is in this context that the concept of resilience planning has taken on a new significance. Drawing on contemporary research in London and Hong Kong, the paper shows how resilience and recovery planning has become a key area of political debate. It examines what is meant by conservative and radical interpretations of resilience and how conservative views have come to dominate ‘recovery’ thinking, with élite groups unwilling to accept the limits to the neo-liberal orthodoxies that helped to precipitate the economic crisis. The paper explores the implications of such thinking for the politics of urban development.

Modelling economic returns to plant variety protection in the UK

This paper attempts an empirical assessment of the incentive effects of plant variety protection regimes in the generation of crop variety innovations. A duration model of plant variety protection certificates is used to infer the private appropriability of returns from agricultural crop variety innovations in the UK over the period 1965-2000. The results suggest that plant variety protection provides only modest appropriability of returns to innovators of agricultural crop varieties. The value distribution of plant variety protection certificates is highly skewed with a large proportion of innovations providing virtually no returns to innovators. Increasing competition from newer varieties appears to have accelerated the turnover of varieties reducing appropriability further. Plant variety protection emerges as a relatively weak instrument of protection.