世界経済・社会統計 = World development indicators

The gravity model has been widely used to infer substantial trade flow effects of institutions such as customs unions and exchange rate mechanisms. McCallum [1995] found that the US-Canada border led to trade between provinces that is a factor 22 (2,200%) times trade between states and provinces, a spectacular puzzle in light of the low formal barriers on this border. We show that the gravity model usually estimated does not correspond to the theory behind it. We solve the 'border puzzle' by applying the theory seriously. We find that national borders reduce trade between the US and Canada by about 44%, while reducing trade among other industrialized countries by about 30%. McCallum's spectacular headline number is the result of a combination of omitted variables bias and the small size of the Canadian economy. Within-Canada trade rises by a factor 6 due to the border. In contrast, within-US trade rises 25%.

https://papers.ssrn.com/sol3/Delivery.cfm?abstractid=256086

Gravity with Gravitas: A Solution to the Border Puzzle

This article builds a theoretical framework to help explain governance patterns in global value chains It draws on three streams of literature ‐ transaction costs economics, production networks, and technological capability and firm-level learning ‐ to identify three variables that play a large role in determining how global value chains are governed and change These are: (1) the complexity of transactions, (2) the ability to codify transactions, and (3) the capabilities in the supply-base The theory generates five types of global value chain governance ‐ hierarchy, captive, relational, modular, and market ‐ which range from high to low levels of explicit coordination and power asymmetry The article highlights the dynamic and overlapping nature of global value chain governance through four brief industry case studies: bicycles, apparel, horticulture and electronics

/pdf/the-governance-of-global-value-chains-3dmchifo7i.pdf

The governance of global value chains

Gravity equations have been widely used to infer trade flow effects of various institutional arrangements. We show that estimated gravity equations do not have a theoretical foundation. This implies both that estimation suffers from omitted variables bias and that comparative statics analysis is unfounded. We develop a method that (i) consistently and efficiently estimates a theoretical gravity equation and (ii) correctly calculates the comparative statics of trade frictions. We apply the method to solve the famous McCallum border puzzle. Applying our method, we find that national borders reduce trade between industrialized countries by moderate amounts of 20-50 percent.

/pdf/gravity-with-gravitas-a-solution-to-the-border-puzzle-4dn7us6msp.pdf

This paper develops techniques for empirically analyzing demand and supply in differentiated products markets and then applies these techniques to analyze equilibrium in the U.S. automobile industry. Our primary goal is to present a framework which enables one to obtain estimates of demand and cost parameters for a class of oligopolistic differentiated products markets. These estimates can be obtained using only widely available product-level and aggregate consumer-level data, and they are consistent with a structural model of equilibrium in an oligopolistic industry. When we apply the tech- niques developed here to the U.S. automobile market, we obtain cost and demand parameters for (essentially) all models marketed over a twenty year period.

/pdf/automobile-prices-in-market-equilibrium-1w0xnf91hi.pdf

Automobile prices in market equilibrium

The last few decades have seen a spectacular integration of the global economy through trade. The rising integration of world markets has brought with it a disintegration of the production process, however, as manufacturing or services activities done abroad are combined with those performed at home. I compare several different measures of foreign outsourcing, and argue that they have all increased since the 1970s. I also consider the implications of globalization for employment and wages of low-skilled workers, and for trade and regulatory policy, such as labor standards.

Integration of trade and disintegration of production in the global economy

We explore the relationship between proximity of buyers and sellers and the organizational form of outsourcing. Outsourcing can be "contractual" in which suppliers undertake specific investments or involve "generic" market transactions. Proximity expands the variety of products sourced through contracts abroad rather than at home, but the range of generic imports is unchanged. A higher-quality foreign workforce raises the variety of contractual trade, but at the expense of generics. We confirm these predictions using data for ordinary versus processing exports from Chinese provinces to destination markets and also the predictions of an extended model that allows for multinational production.

/pdf/contractual-versus-generic-outsourcing-the-role-of-proximity-2gxs9i5s3n.pdf

Contractual Versus Generic Outsourcing: The Role of Proximity

These two volumes contain seventy essays chosen largely for the originality of their contributions. The first volume contains several classic papers. Among them are the many contributions to the theory of distortions in the 1960s which laid the foundations of the postwar theory of commercial policy. Also included are Bhagwati's important papers of the 1970s and 1980s which have shaped a new revolution in the theory of trade and welfare: the political-economy-theoretic analysis of DUP (directly-unproductive profit-seeking) activities. Influential essays on the nonequivalence of tariffs and quotas, immiserizing growth, cost-benefit analysis in open economies, and other major areas of trade theory are covered. The second volume presents essays that have opened up new areas of analysis in the theory of international trade and in the associated fields of public finance and developmental economics. Bhagwati's seminal work on the novel question of the appropriate income tax jurisdiction in the presence of international factor mobility, his well-known analyses of the consequences of skilled migration, the problem of the optimal choice between international capital and labor mobility, are all included.

The Theory of Commercial Policy

Economists disagree on whether recent U.S. trade policies are harmful or helpful, but they all agree that there is a new trend toward focusing on results-oriented policies in specific markets and with particular trading partners. These twelve essays by leading international economists explore crucial issues in U.S. trade policy today. Topics examined include the markets for automobile and automobile parts in the United States and Japan, the U.S. response to "unfair" trading practices such as dumping, and the effects of industry- and country-specific policies. Examples include high-technology and agricultural industries and off-shore assembly in U.S. border cities. The volume concludes that some policies can act to both protect imports and promote exports, that the threat of protectionist policies can often have effects that are as pronounced as their implementation, and that regulatory policy has as great an impact on trade and investment patterns as does trade policy itself. It will be of crucial interest to international trade economists, policy specialists, and political scientists.

Robert C. Feenstra

Papers

Integration of trade and disintegration of production in the global economy

Contractual Versus Generic Outsourcing: The Role of Proximity

The Theory of Commercial Policy

Introduction to "The Effects of U.S. Trade Protection and Promotion Policies"

New products with a symmetric AIDS expenditure function