Optimal Tariffs with Firm Heterogeneity, Variable Markups, and FDI PDF Download
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Author: Ziran Ding
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Author: Ziran Ding
Publisher:
ISBN:
Category :
Languages : en
Pages :
Get Book Here
Book Description
Author: Ziran Ding
Publisher:
ISBN:
Category : Economics
Languages : en
Pages : 156
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Book Description
The overarching theme of this dissertation is the analysis of trade policy implication in the presence of firm heterogeneity, variable markups, and multinational production. Chapter 1 surveys the main ingredients and results of heterogeneous firms trade policy literature that has been developing since the early 2000s. First, I present in great detail various stylized facts regarding firm heterogeneity, firm-level markups, and the global structure of multinational production. Second, I summarize the results of the recent development of theoretical approaches of modeling the firm-level markups. Third, I discuss the theoretical frameworks that incorporates multinational production into heterogeneous firms framework. Fourth, I review the trade policy literature that features firm heterogeneity, variable markups, and multinational production. Finally, I highlight the contribution of this dissertation and discuss directions for future research. Chapter 2 introduces ad valorem tariff and horizontal FDI into the Melitz and Ottaviano [2008] framework, producing the first framework in the trade policy literature that incor- porates firm heterogeneity, variable markups, and multinational production. The model generates novel equilibrium implications. First, the presence of multinational production generates a competitive effect on the economy, and firms need to be more productive to survive the competition. Second, the ad valorem tariff and quadratic quasi-linear preference collectively result in an endogenous level of firm entry. Therefore, the impact of trade/tariff liberalization depends on the equilibrium number of firms. In the short-run, when the firm entry is prohibited, an increase in import tariff shields the domestic economy from the For- eign competition, making it easier for firms to survive. This result is overturned when firms can enter the market freely in the long-run. In the long-run, an increase in Home's import tariff will make the Home country a more desirable environment to do business, attracting more entrants in the Home market, making the Home market more competitive. Firms need to be more productive to survive. Home0́9s tariff increase also makes it harder for the least productive Foreign exporters to survive, and triggers tariff-jumping FDI among the most productive exporters. Markups also respond to tariff change differently in the short-run vs. long-run, primarily due to the change of competitive environment associated with firm entry. Chapter 3 studies the welfare implication of tariff and optimal tariffs in an environment features firm heterogeneity, variable markups and FDI. The findings can be broadly sum- marized in three aspects. First, the quadratic quasi-linear preference generates multiple externalities in this economy, causing market outcome to differ from the socially optimum outcome systematically. Permitting FDI lowers the domestic cutoff levels and reduces the misallocation in the economy. Second, free trade is not always socially optimal. If the do- mestic cutoff is sufficiently high, an additional firm entry can improve social welfare. In this case, a positive import tariff is welfare-improving because it encourages firm entry. Third, both positively and normatively, the interaction of variable markup and FDI generates novel trade policy insights that are absent if consumers possess CES preference.
Author: Matthew T. Cole
Publisher:
ISBN:
Category : Investments, Foreign
Languages : en
Pages : 35
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Author: Andrew B. Bernard
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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This paper examines how country, industry and firm characteristics interact in general equilibrium to determine nations' responses to trade liberalization. When firms possess heterogeneous productivity, countries differ in relative factor abundance and industries vary in factor intensity, falling trade costs induce reallocations of resources both within and across industries and countries. These reallocations generate substantial job turnover in all sectors, spur relatively more creative destruction in comparative advantage industries than comparative disadvantage industries, and magnify ex ante comparative advantage to create additional welfare gains from trade. The relative ascendance of high-productivity firms within industries boosts aggregate productivity and drives down consumer prices. In contrast with the neoclassical model, these price declines dampen and can even reverse the real wage losses of scarce factors as countries liberalize.
Author: Emili Grifell-Tatjé
Publisher: Oxford University Press
ISBN: 0190226730
Category : Business & Economics
Languages : en
Pages : 902
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Book Description
Productivity underpins business success and national well-being and thus it is crucial to understand the factors that influence productivity growth. This volume provides a comprehensive exploration into the significance of productivity growth for business, the economy, and for social economic progress. It examines how productivity is defined, measured and implemented. It also surveys the dispersion of productivity across time and place, focusing on the productivity dynamics that either leads to a reallocation of resources that reduces dispersion and increases aggregate productivity or, conversely, allows dispersion to persist behind barriers to productivity-enhancing reallocation. A third focus is an investigation of the drivers of, or impediments to, productivity growth, some of which are organizational in nature and under management control and others of which are institutional in nature and subject to public policy intervention. The Oxford Handbook of Productivity Analysis contains contributions of distinguished productivity experts from around the world who analyze a wide range of timely issues. These issues concern purely analytical topics surrounding the measurement of productivity in various situations, beginning with the ideal situation in which all inputs and all outputs, and their prices, are observed accurately. They also include service sectors such as education in which the services provided are hard to define, much less measure, and other sectors that generate undesirable environmental externalities that are difficult to price and complicate the very definition of productivity. The issues also involve business management topics ranging from the role of business models and benchmarking to the quality of management practices, the adoption of new technologies, and possible complementarities between the two. The relationship between productivity and business performance is also explored. At a more aggregate level the issues range from the impacts of market power, incentive regulation, international trade and global value chains on productivity, to the contribution of productivity to economic development and economic welfare.
Author: Gianmarco I. P. Ottaviano
Publisher: World Scientific Studies in In
ISBN: 9789811233388
Category : Business & Economics
Languages : en
Pages : 0
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Globalization is a complex phenomenon involving the mobility of goods, capital, labour and ideas across country borders. From an economic point of view, two waves of globalization have been identified by scholars so far. The first wave materialized between the second half of the Nineteenth century and WWI; the second wave rose after WWII and gained momentum at the end of the Twentieth century before slowing down in the aftermath of the global financial crisis due to renewed protectionist pressures. This collection of essays studies the implications of this second wave of globalization for national economic performance. In doing so, it takes a bottom-up approach, building up the macroeconomic trajectories from the microeconomic effects of globalization on firms and workers. The collected essays highlight the asymmetry of responses across firms and workers between and within industries as well as territories, thus explaining the forces behind the emergence of 'winners' and 'losers' from globalization. The collection shows how state-of-the-art models of international economics and economic geography can be brought to life by addressing several topical issues in the public debate, ranging from regional growth and regional decline to international competition and creative destruction, from innovation patterns to cultural diversity and from immigration to offshoring.
Author: John Stuart Mill
Publisher:
ISBN:
Category : Economics
Languages : en
Pages : 188
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Author: Takatoshi Ito
Publisher: University of Chicago Press
ISBN: 0226379000
Category : Business & Economics
Languages : en
Pages : 431
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The practice of trading across international borders has undergone a series of changes with great consequences for the world trading community, the result of new trade agreements, a number of financial crises, the emergence of the World Trade Organization, and countless other less obvious developments. In International Trade in East Asia, a group of esteemed contributors provides a summary of empirical factors of international trade specifically as they pertain to East Asian countries such as China, Japan, Korea, and Taiwan. Comprised of twelve fascinating studies, International Trade in East Asia highlights many of the trading practices between countries within the region as well as outside of it. The contributors bring into focus some of the region's endemic and external barriers to international trade and discuss strategies for improving productivity and fostering trade relationships. Studies on some of the factors that drive exports, the influence of research and development, the effects of foreign investment, and the ramifications of different types of protectionism will particularly resonate with the financial and economic communities who are trying to keep pace with this dramatically altered landscape.
Author: Diao, Xinshen
Publisher: Intl Food Policy Res Inst
ISBN:
Category : Political Science
Languages : en
Pages : 85
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Book Description
Recent growth accelerations in Africa are characterized by increasing productivity in agriculture, a declining share of the labor force employed in agriculture and declining productivity in modern sectors such as manufacturing. To shed light on this puzzle, we disaggregate firms in the manufacturing sector by size using two newly created panels of manufacturing firms, one for Tanzania covering 2008-2016 and one for Ethiopia covering 1996-2017. Our analysis reveals a dichotomy between larger firms that exhibit superior productivity performance but do not expand employment much, and small firms that absorb employment but do not experience any productivity growth. We suggest the poor employment performance of large firms is related to use of capital-intensive techniques associated with global trends in technology.
Author: World Bank
Publisher: World Bank Publications
ISBN: 1464814953
Category : Business & Economics
Languages : en
Pages : 511
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Book Description
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.
