Download or read book Trade in Intermediate Inputs and Business Cycle Comovement written by Robert C. Johnson and published by . This book was released on 2012 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: Do cross-border input linkages transmit shocks and synchronize business cycles across countries? I integrate input trade into a dynamic many country, multi-sector model and calibrate the model to match observed bilateral input-output linkages. With estimated productivity shocks, the model generates an aggregate trade-comovement correlation 30-40% as large as in data, and 50-75% as large for the goods producing sector. With independent shocks, the model accounts for one-quarter of the trade-comovement relationship for gross output of goods. However, shocks transmitted through input linkages do not synchronize value added. And contrary to conventional wisdom, input complementarity does not amplify value added comovement.

Download or read book Trade in Intermediate Inputs and Business Cycle Movement written by Robert C. Johnson and published by . This book was released on 2012 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Putting the Parts Together Trade Vertical Linkages and Business Cycle Comovement written by Andrei A. Levchenko and published by INTERNATIONAL MONETARY FUND. This book was released on 2009-08-01 with total page 55 pages. Available in PDF, EPUB and Kindle. Book excerpt: Countries that trade more with each other exhibit higher business cycle correlation. This paper examines the mechanisms underlying this relationship using a large cross-country industry-level panel dataset of manufacturing production and trade. We show that sector pairs that experience more bilateral trade exhibit stronger comovement. Vertical linkages in production are an important explanation behind this effect: bilateral international trade increases comovement significantly more in cross-border industry pairs that use each other as intermediate inputs. Our estimates imply that these vertical production linkages account for some 30% of the total impact of bilateral trade on the business cycle correlation.

Download or read book The Few Leading the Many written by Jörn Kleinert and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper uses micro-data on balance sheets, trade, and the nationality of ownership of firms in France to investigate the effect of foreign multinationals on business cycle comovement. We first show that foreign affiliates, which represent a tiny fraction of all firms, are responsible for a high share of employment, value added, and trade both at the national and at the regional levels. We also show that the distribution of foreign affiliates across French regions differs with the nationality of the parent. We then show that foreign affiliates increase the comovement of activities between their region of location and their country of ownership. We also find that intra-firm trade in intermediate inputs is a significant channel of influence of business cycle comovement. These findings suggest that the international transmission of shocks is partly due to linkages between affiliates and their foreign parents, and that a few multinational companies drive a non-negligible part of business cycle comovement.

Download or read book Trade Integration and Business Cycle Synchronization written by Mr.Romain A Duval and published by International Monetary Fund. This book was released on 2014-04-03 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper reexamines the relationship between trade integration and business cycle synchronization (BCS) using new value-added trade data for 63 advanced and emerging economies during 1995–2012. In a panel framework, we identify a strong positive impact of trade intensity on BCS—conditional on various controls, global common shocks and country-pair heterogeneity—that is absent when gross trade data are used. That effect is bigger in crisis times, pointing to trade as an important crisis propagation mechanism. Bilateral intra-industry trade and trade specialization correlation also appear to increase co-movement, indicating that not only the intensity but also the type of trade matters. Finally, we show that dependence on Chinese final demand in value-added terms amplifies the international spillovers and synchronizing impact of growth shocks in China.

Download or read book World Development Report 2020 written by World Bank and published by World Bank Publications. This book was released on 2019-11-19 with total page 511 pages. Available in PDF, EPUB and Kindle. Book excerpt: Global value chains (GVCs) powered the surge of international trade after 1990 and now account for almost half of all trade. This shift enabled an unprecedented economic convergence: poor countries grew rapidly and began to catch up with richer countries. Since the 2008 global financial crisis, however, the growth of trade has been sluggish and the expansion of GVCs has stalled. Meanwhile, serious threats have emerged to the model of trade-led growth. New technologies could draw production closer to the consumer and reduce the demand for labor. And trade conflicts among large countries could lead to a retrenchment or a segmentation of GVCs. World Development Report 2020: Trading for Development in the Age of Global Value Chains examines whether there is still a path to development through GVCs and trade. It concludes that technological change is, at this stage, more a boon than a curse. GVCs can continue to boost growth, create better jobs, and reduce poverty provided that developing countries implement deeper reforms to promote GVC participation; industrial countries pursue open, predictable policies; and all countries revive multilateral cooperation.

Download or read book Firm Innovation and Productivity in Latin America and the Caribbean written by Inter-American Development Bank and published by Springer. This book was released on 2016-07-01 with total page 366 pages. Available in PDF, EPUB and Kindle. Book excerpt: This volume uses the study of firm dynamics to investigate the factors preventing faster productivity growth in Latin America and the Caribbean, pushing past the limits of traditional macroeconomic analyses. Each chapter is dedicated to an examination of a different factor affecting firm productivity - innovation, ICT usage, on-the-job-training, firm age, access to credit, and international linkages - highlighting the differences in firm characteristics, behaviors, and strategies. By showcasing this remarkable heterogeneity, this collection challenges regional policymakers to look beyond one-size-fits-all solutions and create balanced policy mixes tailored to distinct firm needs. This book is open access under a CC BY-NC-ND 3.0 IGO license.

Download or read book Trade Linkages and International Business Cycle Comovement Evidence from Korean Industry Data written by Dongyeol Lee and published by International Monetary Fund. This book was released on 2019-05-24 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt: Through the 2000s, Korea’s export and import linkages to advanced and emerging markets increased significantly. At the same time, the correlation of output growth between Korea and these economies rose. This paper investigates the nature of the link between trade linkages and the comovement of international business cycles (BC) using Korean industry-level domestic and international input-output data. The results suggest that, at the industry-level, higher export linkages lead to a larger positive GDP growth comovement, while higher import linkages lead to higher negative employment growth comovement. Furthermore, the decomposition of aggregate BC comovement shows that the increase in trade with China has contributed the most to aggregate BC comovement, while the impact of trade linkages on BC comovement is propagated domestically via vertical linkages. These findings suggest that the Korean economy can be significantly affected by a few countries that are highly linked through trade to Korea and/or a few industries that are highly interconnected to other industries.

Download or read book Dominant Currency Paradigm A New Model for Small Open Economies written by Camila Casas and published by International Monetary Fund. This book was released on 2017-11-22 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt: Most trade is invoiced in very few currencies. Despite this, the Mundell-Fleming benchmark and its variants focus on pricing in the producer’s currency or in local currency. We model instead a ‘dominant currency paradigm’ for small open economies characterized by three features: pricing in a dominant currency; pricing complementarities, and imported input use in production. Under this paradigm: (a) the terms-of-trade is stable; (b) dominant currency exchange rate pass-through into export and import prices is high regardless of destination or origin of goods; (c) exchange rate pass-through of non-dominant currencies is small; (d) expenditure switching occurs mostly via imports, driven by the dollar exchange rate while exports respond weakly, if at all; (e) strengthening of the dominant currency relative to non-dominant ones can negatively impact global trade; (f) optimal monetary policy targets deviations from the law of one price arising from dominant currency fluctuations, in addition to the inflation and output gap. Using data from Colombia we document strong support for the dominant currency paradigm.

Download or read book New Developments in Productivity Analysis written by Charles R. Hulten and published by University of Chicago Press. This book was released on 2007-11-01 with total page 648 pages. Available in PDF, EPUB and Kindle. Book excerpt: The productivity slowdown of the 1970s and 1980s and the resumption of productivity growth in the 1990s have provoked controversy among policymakers and researchers. Economists have been forced to reexamine fundamental questions of measurement technique. Some researchers argue that econometric approaches to productivity measurement usefully address shortcomings of the dominant index number techniques while others maintain that current productivity statistics underreport damage to the environment. In this book, the contributors propose innovative approaches to these issues. The result is a state-of-the-art exposition of contemporary productivity analysis. Charles R. Hulten is professor of economics at the University of Maryland. He has been a senior research associate at the Urban Institute and is chair of the Conference on Research in Income and Wealth of the National Bureau of Economic Research. Michael Harper is chief of the Division of Productivity Research at the Bureau of Labor Statistics. Edwin R. Dean, formerly associate commissioner for Productivity and Technology at the Bureau of Labor Statistics, is adjunct professor of economics at The George Washington University.

Download or read book Recursive Methods in Economic Dynamics written by Nancy L. Stokey and published by Harvard University Press. This book was released on 1989-10-10 with total page 607 pages. Available in PDF, EPUB and Kindle. Book excerpt: This rigorous but brilliantly lucid book presents a self-contained treatment of modern economic dynamics. Stokey, Lucas, and Prescott develop the basic methods of recursive analysis and illustrate the many areas where they can usefully be applied.

Download or read book Power Laws in Firm Size and Openness to Trade written by Mr.Andrei A. Levchenko and published by International Monetary Fund. This book was released on 2010-04-01 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: Existing estimates of power laws in firm size typically ignore the impact of international trade. Using a simple theoretical framework, we show that international trade systematically affects the distribution of firm size: the power law exponent among exporting firms should be strictly lower in absolute value than the power law exponent among non-exporting rms. We use a dataset of French firms to demonstrate that this prediction is strongly supported by the data. While estimates of power law exponents have been used to pin down parameters in theoretical and quantitative models, our analysis implies that the existing estimates are systematically lower than the true values. We propose two simple ways of estimating power law parameters that take explicit account of exporting behavior.

Download or read book Cars in Europe Supply Chains and Spillovers During COVID 19 Times written by Vizhdan Boranova and published by International Monetary Fund. This book was released on 2022-01-14 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: Cars in Europe: Supply Chains and Spillovers during COVID-19 Times

Download or read book A Theory of Domestic and International Trade Finance written by Mr.JaeBin Ahn and published by International Monetary Fund. This book was released on 2011-11-01 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper provides a theory model of trade finance to explain the "great trade collapse." The model shows that, first, the riskiness of international transactions rises relative to domestic transactions during economic downturns, and second, the exclusive use of a letter of credit in international transactions exacerbates a collapse in trade during a financial crisis. The basic model considers banks' optimal screening decisions in the presence of counterparty default risks. In equilibrium, banks will maintain a higher precision screening test for domestic firms and a lower precision screening test for foreign firms, which constitutes the main mechanism of the model.

Download or read book Global Value Chain Development Report 2021 written by Banque asiatique de développement and published by . This book was released on 2022-01-25 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: A radical shift is underway in global value chains as they increasingly move beyond traditional manufacturing processes to services and other intangible assets. Digitization is a leading factor in this transformation, which is being accelerated by the coronavirus disease (COVID-19) pandemic. The Global Value Chain Development Report, the third of a biennial series, explores this shift beyond production. The report shows how the rise of services value chains offers a new path to development and how protectionism and geopolitical tensions, environmental risks, and pandemics are undermining the stability of global value chains and forcing their reorganization geographically. It is co-published by the WTO, the Asian Development Bank, the Research Institute for Global Value Chains at the University of International Business and Economics, the Institute of Developing Economies, and the China Development Research Foundation.

Download or read book Making It Big written by Andrea Ciani and published by World Bank Publications. This book was released on 2020-10-08 with total page 178 pages. Available in PDF, EPUB and Kindle. Book excerpt: Economic and social progress requires a diverse ecosystem of firms that play complementary roles. Making It Big: Why Developing Countries Need More Large Firms constitutes one of the most up-to-date assessments of how large firms are created in low- and middle-income countries and their role in development. It argues that large firms advance a range of development objectives in ways that other firms do not: large firms are more likely to innovate, export, and offer training and are more likely to adopt international standards of quality, among other contributions. Their particularities are closely associated with productivity advantages and translate into improved outcomes not only for their owners but also for their workers and for smaller enterprises in their value chains. The challenge for economic development, however, is that production does not reach economic scale in low- and middle-income countries. Why are large firms scarcer in developing countries? Drawing on a rare set of data from public and private sources, as well as proprietary data from the International Finance Corporation and case studies, this book shows that large firms are often born large—or with the attributes of largeness. In other words, what is distinct about them is often in place from day one of their operations. To fill the “missing top†? of the firm-size distribution with additional large firms, governments should support the creation of such firms by opening markets to greater competition. In low-income countries, this objective can be achieved through simple policy reorientation, such as breaking oligopolies, removing unnecessary restrictions to international trade and investment, and establishing strong rules to prevent the abuse of market power. Governments should also strive to ensure that private actors have the skills, technology, intelligence, infrastructure, and finance they need to create large ventures. Additionally, they should actively work to spread the benefits from production at scale across the largest possible number of market participants. This book seeks to bring frontier thinking and evidence on the role and origins of large firms to a wide range of readers, including academics, development practitioners and policy makers.

Download or read book Technology Shocks and Aggregate Fluctuations written by Mr.Pau Rabanal and published by International Monetary Fund. This book was released on 2004-12-01 with total page 68 pages. Available in PDF, EPUB and Kindle. Book excerpt: Our answer: Not so well. We reached that conclusion after reviewing recent research on the role of technology as a source of economic fluctuations. The bulk of the evidence suggests a limited role for aggregate technology shocks, pointing instead to demand factors as the main force behind the strong positive comovement between output and labor input measures.