Greece’s trade deficit declined by 10% of GDP between 2007 and 2012, removing one of the great imbalances of the pre-Crisis years. Exports actually fell over the period, however, worsening the country’s economic crisis. This column compares Greece’s actual export performance with a benchmark for the expected trade response to the reduction in net capital. Greece’s exports should have increased by 25%, and export underperformance was responsible for a third of the country’s GDP decline. While labour markets have adjusted to the new economic environment, product markets seem to be hindering the recovery of competitiveness.
Costas Arkolakis, Manolis Galenianos, Sunday, November 22, 2015 - 00:00
Emilie Anér, Anna Graneli, Magnus Lodefalk, Wednesday, October 14, 2015 - 00:00
A large body of research has established a positive link between immigrants and bilateral trade. However, the temporary movement of people across borders has received less attention. This column uses Swedish data to analyse the impact of temporary cross-border movement on trade. Recently arrived migrants are found to reduce the negative impact of distance on foreign trade, by assisting firms to overcome informal and informational barriers to trade with their origin country. Facilitating movement of people across borders can be a highly useful tool for engaging in and benefitting from specialised and internationalised production networks.
Céline Carrère, Anja Grujovic, Frédéric Robert-Nicoud, Thursday, September 3, 2015 - 00:00
When looking at the potential effects of a trade policy, trade economists usually insist on the real income effects, often dismissing its unemployment effects as of second-order importance, whereas policymakers and the public at large tend to voice concerns about jobs gained or lost. This column presents a quantitative framework that weighs both concerns, which is especially important when real incomes and the unemployment rates move in the same direction following a trade reform.
Andrew K Rose, Tuesday, September 1, 2015 - 00:00
A nation’s hard power is based on its ability to coerce, while its soft power depends on the attractiveness of its culture, political ideals, and policies. This column shows that a country’s soft power has measureable effects on its exports. Countries that are admired for their positive global influence export more, holding other things constant.
Kaoru Hosono, Daisuke Miyakawa, Miho Takizawa, Thursday, August 27, 2015 - 00:00
‘Learning by exporting’ refers to productivity gains experienced by firms after they commence exporting. Such gains are argued to be due to access to new knowledge and resources. This column explores some of the preconditions for learning-by-exporting effects, using data on the overseas activities and affiliations of Japanese firms. Firms that enter markets in which they don’t have affiliates or subsidiaries are found to enjoy the most learning-by-exporting productivity gains. These findings have implications for the timing of new market entry.
Uri Dadush, Friday, March 13, 2015 - 00:00
Jason Furman, Friday, February 20, 2015 - 00:00
Theodore H. Moran, Friday, January 30, 2015 - 00:00
Otaviano Canuto, Cornelius Fleischhaker, Philip Schellekens, Sunday, January 11, 2015 - 00:00
Emine Boz, Matthieu Bussière, Clément Marsilli, Wednesday, November 12, 2014 - 00:00
Amir Attaran, Roger Bate, Ginger Zhe Jin, Aparna Mathur, Thursday, October 9, 2014 - 00:00
Jeffrey Frankel, Tuesday, September 9, 2014 - 00:00
Marco Annunziata, Saturday, August 16, 2014 - 00:00
Africa has generated a lot of enthusiasm lately. The cynical view of the continent as a hopeless basket case has been replaced by the lofty narrative of Africa Rising. This column argues that Africa’s progress is impressive, and there is more to the story than a commodity boom. But Africa is at a crossroads. The opportunities are huge, but the road ahead is long, and will require persistent and patient effort from policymakers as well as business.
Susan Ariel Aaronson, Monday, July 14, 2014 - 00:00
The internet promotes educational, technological, and scientific progress, but governments sometimes choose to control the flow of information for national security reasons, or to protect privacy or intellectual property. This column highlights the use of trade rules to regulate the flow of information, and describes how the EU, the US, and their negotiating partners have been unable to find common ground on these issues. Trade agreements have yet to set information free, and may in fact be making it less free.
Maria Bas, Vanessa Strauss-Kahn, Monday, July 14, 2014 - 00:00
The rise of trade in intermediate inputs is well documented, but its role in shaping domestic economies is not yet completely understood. This column presents evidence from French firms on the effects of importing intermediate inputs. Firms importing more varieties of intermediate inputs increased their productivity and exported more varieties. Foreign inputs from the most advanced economies have the strongest effect on firm productivity, but imported inputs from all countries help raise the number of export varieties.
Patricia Ellen, Jaana Remes, Saturday, July 12, 2014 - 00:00
Brazil has grown rapidly and reduced poverty over the past decade, but it has grown more slowly than other emerging economies and its income per capita remains relatively low by global standards. This column points out that sectors of the Brazilian economy that have been opened up to international competition have outperformed those that remain heavily protected. Deeper integration into global markets and value chains could provide competitive pressures that would improve Brazil’s productivity and living standards.
Jayant Menon, Monday, June 9, 2014 - 00:00
With the rise of mega-regional trade agreements, the world trade system resembles a jigsaw puzzle. This column discusses the difficulties involved in consolidating free trade agreements at the regional level, and argues that piecing together the blocs around the world will be even more challenging. A potential way forward is to return to the most widely used modality of trade liberalisation – unilateral actions – but this time involving the multilateralisation of preferences rather than unreciprocated reductions in tariff rates.
Christopher Parsons, Pierre-Louis Vézina, Friday, May 23, 2014 - 00:00
Immigrants potentially foster international trade by reducing trade costs. This column uses the exodus of the Vietnamese boat people to the US as a natural experiment to provide evidence of such a pro-trade effect. An exogenous allocation of Vietnamese migrants across the US in 1975 was followed by a 20-year trade embargo. Following the lifting of sanctions in 1994, the share of US exports going to Vietnam was higher and more diversified in the states with larger Vietnamese populations.
Zhi Wang, Shang-Jin Wei, Kunfu Zhu, Wednesday, April 16, 2014 - 00:00
One common measure of trade linked international production networks is the so-called VAX ratio, i.e. the ratio of value-added exports to gross exports. This column argues that this measure is not well-behaved at the sector, bilateral, or bilateral sector level, and does not capture important features of international production sharing. A new gross trade accounting framework is proposed that can better track countries’ movements up and down global value chains.
Zhi Wang, Shang-Jin Wei, Kunfu Zhu, Monday, April 7, 2014 - 00:00
The growth of international trade in intermediate inputs means that standard trade statistics can give a misleading picture of the real patterns of production behind world trade. This column introduces an accounting framework that decomposes traditional trade flows into components that better reflect the underlying location of the value addition linked to exports.