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We introduce financial frictions in a two sector model of international trade with heterogeneous agents. The level of specialization in the economy (economic development) depends on the quality of financial institutions. Underdeveloped financial markets prohibit an economy to specialize in...
Persistent link: https://www.econbiz.de/10013093905
In a multi-country general equilibrium economy with mobile capital and rigid-wage unemployment, countries may differ in capital endowments, production technologies and rigid wages. Governments tax capital at the source to maximize national welfare. They account for tax base responses to their...
Persistent link: https://www.econbiz.de/10013150802
This paper intends to combine two fields in the economic literature by examining empirically the FDI pattern – horizontal versus vertical – within the European Union and the relevance of trade integration as a potential determinant of investment flows over the period 1995-2009. We capture...
Persistent link: https://www.econbiz.de/10013051267
Brunnschweiler and Bulte (2008) provide cross-country evidence that the resource curse is a “red herring” once one corrects for endogeneity of resource exports and allows resource abundance affect growth. Their results show that resource exports are no longer significant while the value of...
Persistent link: https://www.econbiz.de/10013316217
Cross-country regressions suggest that urbanization and FDI are important drivers of growth. However, it is not clear that primacy eventually hurts growth performance. Since it is tough to interpret cross-country growth regressions, we provide detailed evidence on the determinants of outward FDI...
Persistent link: https://www.econbiz.de/10012751105
Economists around the world rely in addition to official statistics on business (and consumer) surveys, which are more up-to-date. However, for many emerging and developing countries there is a lack of such surveys. This gap can, at least partly, be filled by the Ifo World Economic Survey (WES)....
Persistent link: https://www.econbiz.de/10012979100
This paper adopts a flexible framework to assess both short- and long-run business cycle linkages between six Latin American (LA) countries and the four largest economies in the world (namely the US, the Euro area, Japan and China) over the period 1980:I-2011:IV. The result indicate that within...
Persistent link: https://www.econbiz.de/10013089557
We review recent research linking international trade to the environment, with a focus on new results and methods. The review is given structure by a novel decomposition linking changes in emissions to changes in productive activity at the plant, firm, industry, and national levels. While some...
Persistent link: https://www.econbiz.de/10012979579
Increasing-returns-to-scale imperfect competition trade models predict a more than proportionate relationship between the larger country's share in world endowments and its share in producing firms: the so called home market effect (HME). While this result plays a key role in empirical testing,...
Persistent link: https://www.econbiz.de/10013112599
Quantitative results from a large class of international trade models depend critically on the elasticity of trade with respect to trade frictions. We develop a simulated method of moments estimator to estimate this elasticity from disaggregate price and trade-flow data using the Ricardian...
Persistent link: https://www.econbiz.de/10013129252