New publications from OECD, May 2019

New OECD publications and statistics have been uploaded to the OECD iLibrary, a comprehensive digital repository of books, papers, and statistics from the Organisation for Economic Cooperation and Development (OECD). Titles recently added include:

• OECD Economic Outlook 2019
• OECD Compendium of Productivity Indicators 2019
• Composite Leading Indicators (CLI), OECD, May 2019
• Consumer Prices, OECD, May 2019

These volumes and more are accessible from the OECD iLibrary by WTO staff and WTO Library patrons.

New Issue of IMF’s Finance and Development: IMF at 75

IMF has just released the June 2019 issue of F&D Magazine, a special issue marking the IMF’s 75th anniversary. Articles in this issue “examine how the IMF should adapt and innovate to serve the needs of the evolving global economy.”

Articles are available at the IMF website here, for consultation individually or as a whole issue online or for download in PDF, for WTO staff and visitors to the WTO Library.

New from OECD: Making Trade Work For All

“Trade is in trouble: since the crisis, trade growth has slowed while public scepticism about trade in some countries has grown.”

OECD has recently launched Make Trade Work For All, a paper which makes a case for trade but “argues that we need to start by acknowledging there are some good reasons for some people to be angry.” The paper argues that action must be taken on three fronts:

1. Creating domestic environments where trade benefits can materialise;
2. Doing more to bring everyone along, particularly in regions facing trade shocks;
3. Making the international system work better.

The full report is available through the OECD iLibrary here.

For a brief summary of the paper, a one-page overview is also available, here.

Book News from WTO Publications, December 2016

The latest issue of Book News from WTO Publications, highlighting recently launched titles and products, is now available.

Featured in this instalment are four new titles:

• Trade Profiles 2016 (also available in French and Spanish)
• World Tariff Profiles 2016 (also available in French and Spanish)
• An Advanced Guide to Trade Policy Analysis: The Structural Gravity Model
• Trade Costs and Inclusive Growth: Case Studies Presented by WTO Chair-holders

To learn more about WTO Publications and availability of titles, visit the WTO Publications website or the WTO Bookshop website.

World Bank Economic Review – Volume 29, Issue 1

Chinese Firms’ Entry to Export Markets: The Role of Foreign Export Spillovers
Optimal Food Price Stabilization in a Small Open Developing Country
Powering Up Developing Countries through Integration?
(Ineffective) Messages to Encourage Recycling: Evidence from a Randomized Evaluation in Peru
Development at the Border: Policies and National Integration in Côte D’Ivoire and Its Neighbors
Fiscal Responses after Catastrophes and the Enabling Role of Financial Development

Domestic Tobacco Regulation and International Law

For the most part, conflict between domestic tobacco regulation/international tobacco control instruments and international trade obligations is more imaginary than real. In practice, domestic regulation can be carried out consistently with trade obligations. Nevertheless, there is at least a small chance of actual conflict between international tobacco rules and trade obligations. Where such conflict arises, this paper argues that proper treaty interpretation requires that trade obligations, as the “harder” version of law, would take precedence over conflicting tobacco rules. For public health advocates who have concerns about this, the solution is not to exclude tobacco from trade agreements, but to refine existing trade obligations.

Full-text available in .pdf

Toward Free Trade in Sugar / Daniel R. Pearson

For decades, political support for the U.S. sugar program has been underpinned by the general sense that the costs of producing sugar in this country are quite high relative to prices prevailing in world markets. Thus, the elimination of government support would lead to the certain death of the sugar industry. Recent analysis indicates that this view simply is not correct. Rather, the U.S. industry would continue to produce sugar economically in the absence of government support.

Full-text available in .pdf

Changing power relations in the WTO

This review offers a critical reading of the November 2014 India–U.S. trade deal that unblocked an impasse in the World Trade Organization’s (WTO) Doha round and considers what it means for the way we govern global trade. It argues that the agreement, rather than being a ‘victory’ for the developing world or a cause for celebration, may simply reinforce an unfair and problematic system of distributing trade opportunities among WTO members. It may also obscure further the need for a fundamental overhaul of the way global trade is governed. In so doing, the review speaks to broader debates about what happens when ‘rising’ powers replace established states in global institutions in the absence of wider processes of reform; and it adds to growing concerns about the increasing precariousness of least developed countries (LDCs) in international economic regimes.

Full-text available in .pdf

Revenue Substitution? How Foreign Aid Inflows Moderate the Effect of Bilateral Trade Pressures on Labor Rights

This paper investigates how foreign aid inflows moderate bilateral trade-based pressures on the exporting countries’ labor rights. Because aid provides additional resources to recipient governments, it reduces the importance aid-recipient governments attach to the preferences of their export partners. Consequently, aid inadvertently moderates the leverage exercised by importing countries on the governments of exporting, developing countries. Our analysis of a panel of 91 aid recipient countries for the period 1985–2002 lends support to the “revenue substitution” hypothesis. When aid levels are low, bilateral trade-based pressures are associated with improved labor rights. As aid levels rise, however, the effect loses significance.

Full-text available in .pdf

When trade stops: Lessons from the Gaza blockade 2007–2010

This paper uses detailed household expenditure and firm production data to study the welfare consequences of the blockade imposed on the Gaza Strip between mid-2007 and mid-2010. Using the West Bank as a counterfactual economy, we find that welfare declined by 14%–27%. Moreover, households with larger pre-blockade expenditure levels experienced larger welfare losses. We show that this large decline in welfare may be due to a combination of resource reallocation and reduced productivity. Workers were reallocated from manufacturing to services, and from industries that use imported inputs intensively, or export. In addition, labor productivity fell by 20% on average.

Full-text available in .pdf

The impact of trade openness on growth: The case of Kenya

This paper investigates the effects of trade openness on the level of investment and the rate of economic growth in Kenya using annual time series data. The aggregate trade openness and trade-policy induced openness are evaluated. Controlling for a number of factors, aggregate trade openness is found to have positively affected the level of investment and the rate of economic growth, although the effect on the latter is statistically insignificant. On the other hand, we find trade-policy induced openness to have negatively and significantly affected investment and the rate of economic growth. Granger Causality tests suggest that a change in trade openness influences the long-term rate of economic growth through the interaction with physical capital growth in the case of Kenya.

Full-text available in .pdf

Factor proportions and the growth of world trade

Abstract:
Most of the expansion of global trade since 1980 has been of the North–South kind — between capital-abundant developed and labour-abundant developing countries. Based on this observation, I argue that the recent growth of world trade is best understood from a factor-proportions perspective. Using data on trade barriers and estimates of capital–labour ratios for a group of 45 economies between 1980 and 2008, I find that a calibrated factor-proportions model can generate significant trade growth during this period, amounting to 90% of the observed rise in North–South trade. The opening up of China alone accounts for three quarters of the predicted increase. In line with the model, I present evidence that China’s liberalisation has raised the exports and imports of capital-abundant countries relative to more labour-abundant economies. Overall, my findings suggest that factor-proportions theory may be useful for interpreting several quantitative and qualitative aspects of growing world trade in a period during which the group of large, open economies has become significantly less homogenous.

Full-text available in .pdf

Embodied energy, export policy adjustment and China’s sustainable development: A multi-regional input-output analysis

China has surpassed the United States to be the world’s largest energy consumer, but a lot of energy was used to produce products for exporting to other countries. Presently, China faces a great challenge in energy security and environmental protection. This paper focuses on the energy embodied in China’s foreign trade with a multi-regional input–output approach.

Full-text available in .pdf

The precautionary principle and its approach to risk analysis and quarantine related to the trade of marine ornamental fishes in Brazil

The objective of this study was to employ the precautionary principle in import risk analysis (IRA) and quarantine in the trade of marine ornamental fishes (MOF). The analysis focused on the example of Brazil, as it imports and exports these fishes, in amounts that are globally significant. These processes, since their collection in nature, may expose the fish to stress, which may lead to the development of diseases. The legislation that regulates IRA and quarantine is derived from the Ministries of Agriculture, Livestock and Supply and Fisheries and Aquaculture. The quarantine of MOF in Brazil is not undertaken by government agencies, but by commercial establishments that are registered with the Ministries, and is way too short. According to the data obtained, the precautionary approach is not applied at all in this trade, as scientific information is not contemplated by the legislation, and law is not enforced.

Full-text available in .pdf

Paraguay – country reports

The Economist Intelligence Unit

Paraguay’s online profile
http://country.eiu.com/paraguay
Country report
http://country.eiu.com/FileHandler.ashx?issue_id=1092694093&mode=pdf

Dirección general de estadística, encuesta y censos
http://www.dgeec.gov.py/

World Bank
http://www.worldbank.org/en/country/paraguay

BTI Project : Paraguay Country Report
http://www.bti-project.org/uploads/tx_itao_download/BTI_2014_Paraguay.pdf

Chile – country reports

The Economist Intelligence Unit
Chile’s online profile
http://country.eiu.com/chile
Country report
http://country.eiu.com/FileHandler.ashx?issue_id=1102788894&mode=pdf
Country forecast report as of February 2015
http://country.eiu.com/FileHandler.ashx?issue_id=1752792559&mode=pdf

Instituto Nacional de Estadísticas
http://www.ine.cl/canales/chile_estadistico/estadisticas_economicas/estadisticas_economicas_eng.php?lang=eng

World Bank
http://www.worldbank.org/en/country/chile

BTI Project
Chile Country Report http://www.bti-project.org/uploads/tx_itao_download/BTI_2014_Chile.pdf

Brazil – country reports

The Economist Intelligence Unit :

Brazil’s online profile
http://country.eiu.com/brazil
Country report
http://country.eiu.com/FileHandler.ashx?issue_id=1982667382&mode=pdf
Country forecast as of January 2015
http://country.eiu.com/FileHandler.ashx?issue_id=1102667694&mode=pdf

Instituto Brasileiro de Georgrafia e estatística http://www.ibge.gov.br/home/

World Bank http://www.worldbank.org/en/country/brazil

BTI Project : Brazil Country Report http://www.bti-project.de/uploads/tx_itao_download/BTI_2014_Brazil.pdf

Is India Specialising in Polluting Industries? Evidence from US-India Bilateral Trade

Recently, the apex environmental agency of India observed that domestic industrial pollution has been increasing at an alarming rate over the last two decades, and the need to rein in traditional polluting industries. This raises the pertinent question of whether the poor domestic pollution regime has affected the pattern of India’s trade in dirty manufactured products in the post-liberalisation era since 1991. We find that on the whole, India has remained a net importer of pollution-intensive manufactured goods; however, there is a distinct trend of increasing specialisation in specific dirty industries especially in the bilateral trade with high-income countries, and to a lesser degree with low-income countries. The USA being India’s single largest country trading partner in the post-liberalisation era, we test for pollution offshoring at the finer industry level in US-India bilateral trade. While we find that the pollution haven effect is not significant, India’s specialisation in certain dirty manufacturing industries through the last decade remains a disturbing trend. India needs to integrate environmental sustainability within industrial growth urgently, and it is pertinent to implement policies which would reflect the true pollution costs in an industry that is increasingly competing in the international market.

Full-text available in .pdf

How Foreign Aid Inflows Moderate the Effect of Bilateral Trade Pressures on Labor Rights

This paper investigates how foreign aid inflows moderate bilateral trade-based pressures on the exporting countries’ labor rights. Because aid provides additional resources to recipient governments, it reduces the importance aid-recipient governments attach to the preferences of their export partners. Consequently, aid inadvertently moderates the leverage exercised by importing countries on the governments of exporting, developing countries. Our analysis of a panel of 91 aid recipient countries for the period 1985–2002 lends support to the “revenue substitution” hypothesis. When aid levels are low, bilateral trade-based pressures are associated with improved labor rights. As aid levels rise, however, the effect loses significance.

Full-text available in .pdf

Co-location and Spatial Wage Spillovers in China: The Role of Foreign Ownership and Trade

This paper examines how wages in China are influenced by the interaction and co-location of firms across geographical space. Specifically, and with an emphasis on globally engaged firms and China’s uneven growth across regions we use a spatial econometric approach to estimate the direct and indirect impact of foreign-ownership and export participation on wages. Spatial Durbin Model results reveal an indirect effect of foreign-ownership and exporting on the compensation of workers in co-located firms as well as evidence in support of the standard direct effect that foreign firms, exporters, and firms with a highly educated workforce pay higher wages.

Full-text available in .pdf