Carbon emissions locked - in trade

In recent years there has been a growing concern about the emission trade balance of countries. It is due to the fact that countries with an open economy are active players in the international trade, though trade is not only a major factor in forging a country’s economic structure anymore, but it does contribute to the movement of embodied emissions beyond the country borders. This issue is especially relevant from the carbon accounting policy’s point of view, as it is known that the production-based principle is in effect now in the Kyoto agreement. The study aims at revealing the interdependence of countries on international trade and its environmental impacts, and how the carbon accounting method plays a crucial role in evaluating a country’s environmental performance and its role in the climate mitigation processes. The input-output models are used in the methodology, as they provide an appropriate framework for this kind of environmental accounting; the analysis shows an international comparison of four European countries (Germany, the United Kingdom, the Netherlands, and Hungary) with extended trading activities and carbon emissions. Moving from the production-based approach in the climate policy, to the consumptionperspective principle and allocation [15], it would also help increasing the efficiency of emission reduction targets and the evaluation of the sustainability dimension and its impacts of international trade. The results of the study have shown that there is an importance of distinction between the two emission allocation approaches, both from global and local level point of view.

A Consumption-Based Approach to Carbon Emission Accounting – Sectoral Differences and Environmental Benefits

In recent years there has been growing concern about the emission trade balances of countries. This is due to the fact that countries with an open economy are active players in international trade. Trade is not only a major factor in forging a country’s economic structure, but contributes to the movement of embodied emissions beyond country borders. This issue is especially relevant from the carbon accounting policy and domestic production perspective, as it is known that the production-based principle is employed in the Kyoto agreement. The research described herein was designed to reveal the interdependence of countries on international trade and the corresponding embodied emissions both on national and on sectoral level and to illustrate the significance of the consumption-based emission accounting. It is presented here to what extent a consumption-based accounting would change the present system based on production-based accounting and allocation. The relationship of CO2 emission embodied in exports and embodied in imports is analysed here. International trade can blur the responsibility for the ecological effects of production and consumption and it can lengthen the link between consumption and its consequences. Input-output models are used in the methodology as they provide an appropriate framework for climate change accounting. The analysis comprises an international comparative study of four European countries (Germany, the United Kingdom, the Netherlands, and Hungary) with extended trading activities and carbon emissions. Moving from a production-based approach in climate policy to a consumption-based principle and allocation approach would help to increase the efficiency of emission reductions and would force countries to rethink their trading activities in order to decrease the environmental load of production activities. The results of this study show that it is important to distinguish between the two emission accounting approaches, both on the global and the local level.

Economic reform, allocative effiency and terms of trade

It has widely been agreed that the distorted price system is one of the causes of inefficient ecooomic decisions in centrally planned economies. The paper investigates the possible effect of a price reform on the allocation of resources in a situation where micro-efficiency remains unchanged. Foreign trade and endogenously induced terms-of-trade changes are focal points ín the multisectoral applied general equilibrium analysis. Special attention is paid to some methodological problems connected to the representation of foreign trade in such models. The adoption of Armington's assumption leads to an export demand function and this in turn gives rise to the question of optimal export structure, different from the equilibrium one-an aspect so far neglected in the related literature. The results show, that the applied model allows for a more flexible handling of the overspecialization problem, than the linear programming models. It also becomes evident that the use of export demand functions brings unwanted terms-of-trade changes into the model, to be avoided by a suitable reformulation of the model. The analysis also suggests, that a price reform alone does not significantly increase global economic efficiency. Thus the effect of an economic reform on micro-efficiency appears to be a more crucial factor. The author raises in conclusion some rather general questions related to the foreign trade practice of small open economies.

Essays on exchange rate economics

Exchange rate economics has achieved substantial development in the past few decades. Despite extensive research, a large number of unresolved problems remain in the exchange rate debate. This dissertation studied three puzzling issues aiming to improve our understanding of exchange rate behavior. Chapter Two used advanced econometric techniques to model and forecast exchange rate dynamics. Chapter Three and Chapter Four studied issues related to exchange rates using the theory of New Open Economy Macroeconomics. ^ Chapter Two empirically examined the short-run forecastability of nominal exchange rates. It analyzed important empirical regularities in daily exchange rates. Through a series of hypothesis tests, a best-fitting fractionally integrated GARCH model with skewed student-t error distribution was identified. The forecasting performance of the model was compared with that of a random walk model. Results supported the contention that nominal exchange rates seem to be unpredictable over the short run in the sense that the best-fitting model cannot beat the random walk model in forecasting exchange rate movements. ^ Chapter Three assessed the ability of dynamic general-equilibrium sticky-price monetary models to generate volatile foreign exchange risk premia. It developed a tractable two-country model where agents face a cash-in-advance constraint and set prices to the local market; the exogenous money supply process exhibits time-varying volatility. The model yielded approximate closed form solutions for risk premia and real exchange rates. Numerical results provided quantitative evidence that volatile risk premia can endogenously arise in a new open economy macroeconomic model. Thus, the model had potential to rationalize the Uncovered Interest Parity Puzzle. ^ Chapter Four sought to resolve the consumption-real exchange rate anomaly, which refers to the inability of most international macro models to generate negative cross-correlations between real exchange rates and relative consumption across two countries as observed in the data. While maintaining the assumption of complete asset markets, this chapter introduced endogenously segmented asset markets into a dynamic sticky-price monetary model. Simulation results showed that such a model could replicate the stylized fact that real exchange rates tend to move in an opposite direction with respect to relative consumption. ^

Essays on Exchange Rate Economics

Exchange rate economics has achieved substantial development in the past few decades. Despite extensive research, a large number of unresolved problems remain in the exchange rate debate. This dissertation studied three puzzling issues aiming to improve our understanding of exchange rate behavior. Chapter Two used advanced econometric techniques to model and forecast exchange rate dynamics. Chapter Three and Chapter Four studied issues related to exchange rates using the theory of New Open Economy Macroeconomics. Chapter Two empirically examined the short-run forecastability of nominal exchange rates. It analyzed important empirical regularities in daily exchange rates. Through a series of hypothesis tests, a best-fitting fractionally integrated GARCH model with skewed student-t error distribution was identified. The forecasting performance of the model was compared with that of a random walk model. Results supported the contention that nominal exchange rates seem to be unpredictable over the short run in the sense that the best-fitting model cannot beat the random walk model in forecasting exchange rate movements. Chapter Three assessed the ability of dynamic general-equilibrium sticky-price monetary models to generate volatile foreign exchange risk premia. It developed a tractable two-country model where agents face a cash-in-advance constraint and set prices to the local market; the exogenous money supply process exhibits time-varying volatility. The model yielded approximate closed form solutions for risk premia and real exchange rates. Numerical results provided quantitative evidence that volatile risk premia can endogenously arise in a new open economy macroeconomic model. Thus, the model had potential to rationalize the Uncovered Interest Parity Puzzle. Chapter Four sought to resolve the consumption-real exchange rate anomaly, which refers to the inability of most international macro models to generate negative cross-correlations between real exchange rates and relative consumption across two countries as observed in the data. While maintaining the assumption of complete asset markets, this chapter introduced endogenously segmented asset markets into a dynamic sticky-price monetary model. Simulation results showed that such a model could replicate the stylized fact that real exchange rates tend to move in an opposite direction with respect to relative consumption.

The issue of macroeconomic closure revisited and extended

Léon Walras (1874) already had realized that his neo-classical general equilibrium model could not accommodate autonomous investment. Sen analysed the same issue in a simple, one-sector macroeconomic model of a closed economy. He showed that fixing investment in the model, built strictly on neo-classical assumptions, would make the system overdetermined, thus, one should loosen some neo-classical condition of competitive equilibrium. He analysed three not neo-classical “closure options”, which could make the model well determined in the case of fixed investment. Others later extended his list and it showed that the closure dilemma arises in the more complex computable general equilibrium (CGE) models as well, as does the choice of adjustment mechanism assumed to bring about equilibrium at the macro level. By means of numerical models, it was also illustrated that the adopted closure rule can significantly affect the results of policy simulations based on a CGE model. Despite these warnings, the issue of macro closure is often neglected in policy simulations. It is, therefore, worth revisiting the issue and demonstrating by further examples its importance, as well as pointing out that the closure problem in the CGE models extends well beyond the problem of how to incorporate autonomous investment into a CGE model. Several closure rules are discussed in this paper and their diverse outcomes are illustrated by numerical models calibrated on statistical data. First, the analyses is done in a one-sector model, similar to Sen’s, but extended into a model of an open economy. Next, the same analyses are repeated using a fully-fledged multisectoral CGE model, calibrated on the same statistical data. Comparing the results obtained by the two models it is shown that although, using the same closure option, they generate quite similar results in terms of the direction and – to a somewhat lesser extent – of the magnitude of change in the main macro variables, the predictions of the multi-sectoral CGE model are clearly more realistic and balanced.

A Sustainable Century? Genuine Savings in developing and developed countries, 1900-2000

This chapter traces the long-run development of Genuine Savings (GS) using a panel of eleven countries during the twentieth century. This panel covers a number of developed countries (Great Britain, Germany, Switzerland, France, the US, and Australia) as well as a set of resource-abundant countries in Latin America (Argentina, Brazil, Chile, Colombia, and Mexico). These countries represent approximately 50 percent of the world’s output in terms of Gross Domestic Product (GDP) by 1950, and include large economies and small open economies, and resource-rich and resource-scarce countries, thus allowing us to compare their historical experiences. Components of GS considered include physical and human capital as well as resource extraction and pollution damages. Generally, we find evidence of positive GS over the course of the twentieth century, although the two World Wars and the Great Depression left considerable marks. Also, we found striking differences between Latin American and developed countries when Total Factor Productivity (TFP) is included; this could be a signal of natural resource curse or technological gaps unnoticed in previous works.

The effect on the performance of listed family and non-family firms

Purpose: The purpose of this paper is to examine whether the ownership of public firms is related to accounting and market performance, comparing family and non-family listed firms. Design/methodology/approach: We use regression analysis, considering a sample of Portuguese family and non-family firms for the period between 1999 and 2010. Findings: Overall, the results show that family firms are older, are more indebted and have higher debt costs than non-family firms. However, they present lower levels of risk. The evidence suggests that family firms outperform non-family firms when we consider a market performance measure. The market performance of family-controlled firms is more sensitive to the crisis periods and age, compared to their counterparts. The empirical findings suggest that under economic adversity, the performance is especially compromised by the firms’ age. Research limitations/implications: A limitation of this study is the small size of the sample, which derives from the small size of the Portuguese stock market, the Euronext Lisbon. Originality/value: This paper offers some insights on the ownership of public firms and firm performance by investigating a small European economy. The study also contributes to the stream of firm performance, considering new independent variables as determinants of firm performance, such as operational risk. Finally, the study examines the interaction between ownership and performance under both steady and adverse economic conditions, giving the opportunity to analyze whether firm performance differs according to market conditions.

América Latina y el Caribe: Variables de competitividad para la dinámica empresarial 2007 - 2014

Este estudio realiza una categorización regional de los países en América Latina con respecto de las categorizaciones globales teniendo en cuenta los índices de competitividad, crecimiento económico y desarrollo humano. El objetivo es actualizar los análisis sobre la situación regional de forma cuantitativa involucrando el grado de asimetría en la competitividad. Esta relación entre el posicionamiento global y regional ha influenciado directamente la evolución del tejido empresarial

Does international trade produce convergence?

In spite of increasing globalization around the world, the effects of international trade on economic growth are not very clear. I consider an endogenous economic growth model in an open economy with the Home Market Effect (HME) and non-homothetic preferences in order to identify some determinants of the different results in this relationship. The model shows how trade between similar countries leads to convergence in economic growth when knowledge spillovers are present, while trade between very asymmetric countries produces divergence and may become trade in a poverty or growth trap. The results for welfare move in the same direction as economic growth since convergence implies increases in welfare for both countries, while divergence leads to increases in welfare for the largest country and the opposite for its commercial partner in the absence of knowledge spillovers. International trade does not implicate greater welfare as is usual in a static context under CES preferences.

Learning in and beyond small business advisory programmes

The purpose of this paper is to analyse how participants learn in small business advisory programmes and to explore the impact of these learning programmes on the development of reflective learning dispositions in participants. The research involves two case studies of small business advisory programmes in Queensland, a state of Australia. One involves training in the use of GPS/GIS technology amongst rural SMEs and the other seeks to develop improved management and operational capabilities in regional and metropolitan manufacturing SMEs. Face to face semi-structured interviews were conducted throughout rural, regional and metropolitan Queensland with participants, trainers and senior executives in the administering organisations that ran the programmes. Learning in these programmes occurs through a combination of interaction with others and the adoption of practice-based and learner-centred processes. The impact of the programmes on participants includes the development of reflective learning dispositions, improved confidence in learning and appreciation of the value of new knowledge to their business. The research suggests that small business training programmes have the potential to affect the development of critical reflective learning dispositions in participants which is of fundamental importance to the development of a learning or knowledge economy.

Cetuximab plus chemotherapy in patients with advanced non-small-cell lung cancer (FLEX) : an open-label randomised phase III trial

Background: Use of cetuximab, a monoclonal antibody targeting the epidermal growth factor receptor (EGFR), has the potential to increase survival in patients with advanced non-small-cell lung cancer. We therefore compared chemotherapy plus cetuximab with chemotherapy alone in patients with advanced EGFR-positive non-small-cell lung cancer. Methods: In a multinational, multicentre, open-label, phase III trial, chemotherapy-naive patients (≥18 years) with advanced EGFR-expressing histologically or cytologically proven stage wet IIIB or stage IV non-small-cell lung cancer were randomly assigned in a 1:1 ratio to chemotherapy plus cetuximab or just chemotherapy. Chemotherapy was cisplatin 80 mg/m 2 intravenous infusion on day 1, and vinorelbine 25 mg/m 2 intravenous infusion on days 1 and 8 of every 3-week cycle) for up to six cycles. Cetuximab-at a starting dose of 400 mg/m 2 intravenous infusion over 2 h on day 1, and from day 8 onwards at 250 mg/m 2 over 1 h per week-was continued after the end of chemotherapy until disease progression or unacceptable toxicity had occurred. The primary endpoint was overall survival. Analysis was by intention to treat. This study is registered with ClinicalTrials.gov, number NCT00148798. Findings: Between October, 2004, and January, 2006, 1125 patients were randomly assigned to chemotherapy plus cetuximab (n=557) or chemotherapy alone (n=568). Patients given chemotherapy plus cetuximab survived longer than those in the chemotherapy-alone group (median 11·3 months vs 10·1 months; hazard ratio for death 0·871 [95% CI 0·762-0·996]; p=0·044). The main cetuximab-related adverse event was acne-like rash (57 [10%] of 548, grade 3). Interpretation: Addition of cetuximab to platinum-based chemotherapy represents a new treatment option for patients with advanced non-small-cell lung cancer. Funding: Merck KGaA. © 2009 Elsevier Ltd. All rights reserved.

Resolving the conflicts of sustainable world heritage landscapes in cities : fully open or limited access for visitors?

World Heritage Landscapes (WHLs) are receiving increased attention from researchers, urban planners, managers, and policy makers and many heritage values and resources are becoming irreversibly lost. This phenomenon is especially prominent for WHLs located in cities, where greater development opportunities are involved. Decision making for sustainable urban landscape planning, conservation and management of WHLs often takes place from an economic perspective, especially in developing countries. This, together with the uncertain source of funding to cover WHL operating and maintenance costs, has resulted in many urban managers seeking private sector funding either in the form of visitor access fees or leasing part of the site for high-rental facilities such as five star hotels, clubs and expensive restaurants. For the former, this can result in low-income urban citizens being unable to afford the access fees and hence contradicting the principle of equal access for all; while, for the latter, the principle of open access for all is equally violated. To resolve this conflict, a game model is developed to determine how urban managers should allocate WHL spaces to maximize the combination of economic, social and ecological benefits and cultural values. A case study is provided of the Hangzhou's West Lake Scenic Area, a WHL located at the centre of Hangzhou city, in which several high-rental facilities have recently been closed down by the local authorities due to charges of elitism and misuse of public funds by government officials. The result shows that the best solution is to lease a small space with high rents and leave the remainder of the site to the public. This solution is likely to be applicable only in cities with a strong economy.