Many developing countries have increased their foreign reserve stocks dramatically in recent years, in large part motivated by the desire for precautionary self-insurance. One of the negative consequences of large accumulations for these countries is the risk of valuation losses. In this paper...

International reserve accumulation by developing countries is just one example of the puzzling behavior of international capital flows. Capital should flow to where its return is highest, which ought to be where capital is scare. Yet recent data suggest the opposite Ð net capital flows from...

This paper uses a partial equilibrium model of two small countries, within a large world economy, implementing reciprocal tariff cuts on each otherÕs exports in a regional trade agreement (RTA) and compares the effects with unilateral most-favored-nation (MFN) tariff cuts. The reciprocal cuts...

We offer a simple variant of the standard Heckscher-Ohlin Model that explains how a developing country, by opening to trade with a large capital-abundant economy, can be induced to shift resources into more capital-intensive production than what it was producing in autarky. As a result it...

This book serves two purposes. It provides a straightforward exposition of the complex issues pertaining to the WTO agreements and negotiations, and it presents rigorous analyses of the impact of the WTO-induced reforms on the Indian economy. The book addresses a number of salient issues,...

Firm size follows Zipf's Law, a very fat-tailed distribution that implies a few large firms account for a disproportionate share of overall economic activity. This distribution of firm size is crucial for evaluating the welfare impact of macroeconomic policies such as barriers to entry or trade...

This paper examines the recent upsurge in foreign acquisitions of U.S. firms, specifically focusing on acquisitions made by firms located in emerging markets. Neoclassical theory predicts that, on net, capital should flow from countries that are capital-abundant to countries that are...

This paper analyzes the potential economic effects of bilateral negotiations for an FTA between the United States and the Southern African Customs Union (SACU). The U.S.-SACU FTA bilateral negotiations were initiated in June 2003. But following a number of official meetings, the negotiations...

This paper emphasizes the key roles that services play domestically and internationally in terms of accounting for rising shares of domestic output and employment as well as cross-border trade and foreign direct investment that provide enhanced export opportunities and lower-cost imports....