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

In this paper we investigate the quality change in Japanese car and truck imports over 1979–1985. Car imports have been subject to a quota restraint since April 1981, while compact trucks have faced an ad valorem tariff of 25 percent since August 1980. We find evidence of substantial upgrading in Japanese car imports, with ambiguous quality change in trucks. The welfare cost of the quota restraint in cars exceeds $1,000 per import in 1983 and 1984.

Quality Change Under Trade Restraints in Japanese Autos

https://cid.econ.ucdavis.edu/Papers/pdf/Feenstra-Homothetic.pdf

A homothetic utility function for monopolistic competition models, without constant price elasticity

We consider trade between two countries of unequal size, where the creation of new intermediate inputs occurs in both. We assume that the knowledge gained from R&D in one country does not spillover to the other. Under autarky, the larger country would have a higher rate of product creation. When trade occurs in the final goods, we find that the smaller country has its rate of product creation stowed, even in the long run. In contrast, the larger country enjoys a temporary increase in its rate of R&D. We also examine the welfare consequences of trade in the final goods, which depend on whether the intermediate inputs are traded or not.

Trade and Uneven Growth

https://www.nber.org/system/files/working_papers/w4399/w4399.pdf

Market share and exchange rate pass-through in world automobile trade

This collection of papers by former students and colleagues celebrates the profound impact that Jagdish Bhagwati has had on the field of international economics over the past three decades. Bhagwati, who is the Arthur Lehman Professor of Economics at Columbia University, has made pathbreaking contributions to the theory of international trade and commercial policy, including immiserizing growth, domestic distortions, economic development, and political economy. His success and influence as a teacher and mentor is widely recognized among students at both MIT and Columbia, and as founder of the Journal of International Economics, he has encouraged research on many questions of theoretical and policy relevance. The political economy of trade policy, Bhagwati's most recent area of interest, is the theme of this collection which addresses salient topics including market distortions, income distribution, and the political process of policy-making.Sections and Contributors: - Market Distortions. T. N. Srinivasan. Paul A. Samuelson. Paul R. Krugman.- Trade and Income Distribution. Douglas A. Irwin. Richard A. Brecher and Ehsan U. Choudri. Robert C. Feenstra and Gordon H. Hanson. Earl L. Grinols.- Perspectives on Political Economy. Robert E. Baldwin. Peter Diamond.- Models of Political Economy and Trade. Gene M. Grossman and Elhana Helpman. John Douglas Wilson. B. Peter Rosendorff. Arvind Panagariya and Ronald Findlay.

Robert C. Feenstra

Papers

Quality Change Under Trade Restraints in Japanese Autos

A homothetic utility function for monopolistic competition models, without constant price elasticity

Trade and Uneven Growth

Market share and exchange rate pass-through in world automobile trade

The political economy of trade policy : papers in honor of Jagdish Bhagwati