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Author :
Publisher :
ISBN 13 :
Total Pages : 81 pages
Book Rating : 4.:/5 (19 download)
Download or read book Essays on International Trade, Welfare and Inequality written by and published by . This book was released on 2018 with total page 81 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Zheli He
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (115 download)
Download or read book Essays on International Trade, Welfare and Inequality written by Zheli He and published by . This book was released on 2018 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Kausik Gupta
Publisher : Taylor & Francis
ISBN 13 : 1000853748
Total Pages : 265 pages
Book Rating : 4.0/5 (8 download)
Download or read book International Trade, Economic Development and National Welfare written by Kausik Gupta and published by Taylor & Francis. This book was released on 2023-03-31 with total page 265 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book presents a comprehensive analysis of contemporary issues in international trade and economic development. Emphasising the significance of economic development within policymaking, the book covers important issues like the provisioning of public goods, its implication in a liberalised regime, crime and corruption, skilled–unskilled wage inequality, income distribution and unemployment, environmental regulation and role of educational capital and informal sector. The volume deals with the impact that different aspects of international trade and investment are likely to have on the above-mentioned areas. The essays, written to honour the memory of Professor Sarbajit Chaudhuri, also examine topics that focus on public policy related to immigration of skilled workforce, political resistance and political compulsions that a democratic government might face in keeping with its commitment to tariff reforms, gender wage gap and issues related to globalisation, income distribution and unemployment. The book will be of invaluable interest to postgraduate students, scholars and researchers of development economics, international economics and labour economics and to those working on theoretical research on applications of general equilibrium trade models in developing countries.
Author : Rodrigo Rodrigues Adão
Publisher :
ISBN 13 :
Total Pages : 213 pages
Book Rating : 4.:/5 (958 download)
Download or read book Essays In International Trade and Labor Markets written by Rodrigo Rodrigues Adão and published by . This book was released on 2016 with total page 213 pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis develops empirical methodologies to investigate the effect of globalization on welfare and inequality both between- and within-countries. The first essay proposes a Roy-like model where workers are heterogeneous ill terms of their comparative and absolute advantage. We show that the schedules of comparative and absolute advantage (i) determine changes in the average and the variance of the log-wage distribution, and (ii) are nonparamnetrically identified from the cross-regional variation in the sectoral responses of employment and wages to observable sector-level demand shifters. Applying these results, we find that the rise in world commodity prices accounts for 5-10% of the fall in Brazilian wage inequality between 1991 and 2010. The second essay develops a methodology to construct nonparametric counterfactual predictions, free of functional-form restrictions on preferences and technology, in neoclassical models of international trade. First, we establish the equivalence between such models and reduced exchange models in which countries directly exchange factor services. This equivalence implies that, for an arbitrary change in trade costs, counterfactual changes in factor prices, and welfare only depend on the shape of a reduced factor demand system. Second, we provide sufficient conditions for the nionparainetric identification of this system. Together, these results offer a strict generalization of the parametric approach used in so-called gravity models. Finally, we use China's recent integration into the world economy to illustrate tile feasibility of our approach. The third essay investigates the connection between the recent rise in services trade and changes in labor market outcomes in different countries. We develop a theoretical framework where trade in services arises from the spatial unbundling of workers' task output. Transmission costs endogenously determine the magnitude of between-sector task trade both within a country ("outsourcing") and between countries ("offshoring"). We show that, while differentials in sectoral task prices decrease in response to outsourcing, they increase in response to offshoring. The heterogeneity in the composition of workers' task endowments controls responses in between- and within-sector wage inequality across countries.
Author : Kausik Gupta
Publisher :
ISBN 13 : 9781003375050
Total Pages : 0 pages
Book Rating : 4.3/5 (75 download)
Download or read book International Trade, Economic Development and National Welfare written by Kausik Gupta and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book presents a comprehensive analysis of contemporary issues in international trade and economic development. Emphasising the significance of economic development within policymaking, the book covers important issues like the provisioning of public goods, its implication in a liberalised regime, crime and corruption, skilled-unskilled wage inequality, income distribution and unemployment, environmental regulation and role of educational capital and informal sector. The volume deals with the impact that different aspects of international trade and investment are likely to have on the above-mentioned areas. The essays, written to honour the memory of Professor Sarbajit Chaudhuri, also examine topics that focus on public policy related to immigration of skilled workforce, political resistance and political compulsions that a democratic government might face in keeping with its commitment to tariff reforms, gender wage gap and issues related to globalisation, income distribution and unemployment. The book will be of invaluable interest to postgraduate students, scholars and researchers of development economics, international economics and labour economics and to those working on theoretical research on applications of general equilibrium trade models in developing countries.
Author : Dan Liu
Publisher :
ISBN 13 : 9781267758132
Total Pages : pages
Book Rating : 4.7/5 (581 download)
Download or read book Essays on International Trade and Inequality written by Dan Liu and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The distributional effects of globalization on income have been one of the most important issues in international trade. Whether globalization is one of the explanations of the increasing wage inequality in both developing and developed countries or not has been a debate since 1990s. My dissertation investigates this topic from three aspects: who does trade affect between-group inequality through firm training, market potential and cross-country income, openness and within-group wage inequality. The first chapter incorporates firm-specific training into a recent framework of search model developed by Helpman, Itskhoki and Redding (2010) with heterogeneous firms and two types of workers. More productive firms hire workers with higher average learning ability, invest more on training both skilled and unskilled workers, hire relatively more skilled workers and pay relatively higher wages to skilled workers. Exporting increases wage and training received by workers in a firm with given productivity. For each type of worker, training inequality and wage inequality moves together after opening to trade. Empirical evidence based on firm- and worker-level data is also provided to support model predictions. The second chapter challenges the traditional belief that the US labor productivity advantage in the late 19th century should be attributed to its large domestic market. We assess whether a more general measure of "market access" mattered for the US position in the cross-country distribution of income per capita between 1900 and 1910. After constructing market access measures for 25 countries based on a general equilibrium model of production and trade, the US does not have an overall lead in market access matching its rank in the income distribution. France, Germany and the UK appear to have larger domestic markets than the US. Still, market access does correlate positively with income per capita in the broader sample. We then simulate a general equilibrium trade model with trade costs and provide a calculation of the welfare gains from removing international borders. The largest European countries could not have closed their gap with the US with higher market potential. On the other hand, many small countries could have done so. While market access may not have been crucial for explaining US success, it was an important determinant of real incomes for the most advanced small open-economies. The third chapter provides evidence on the relationship between within-group wage inequality and the degree of openness. One of the key predictions from the theoretical model in Helpman, Itskhoki and Redding (2010) is that there is a non-monotonic relationship between within-group wage inequality and openness, depending on the fraction of exporting firms. In this chapter, I propose a way to test this prediction by constructing a panel data including around 50 manufacturing industries over 34 years. The residuals from Mincer regression is used to calculate within-group wage inequality index. The preliminary results are consistent with these theoretical predictions.
Author : Alexander Tarasov
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (54 download)
Download or read book Essays on Income Distribution and Trade Volumes written by Alexander Tarasov and published by . This book was released on 2009 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: CHAPTER 1: Income Distribution, Market Structure, and Individual Welfare This essay proposes a new insight on how income distribution influences market structure and affects the economic well-being of different groups. It shows that inequality may be good for the poor via a trickle-down effect operating through entry. I consider a general equilibrium model of monopolistic competition with free entry, heterogenous firms and consumers that share identical but non-homothetic preferences. The general model is formulated. The case of two types of consumers, which are different in terms of efficiency units of labor they are endowed with, is considered in detail. I show that higher income inequality in the economy can benefit the poor. An increase in personal income of the rich raises welfare of the poor, while an increase in the fraction of the rich has an ambiguous impact on the poor: welfare of the poor has an inverted U shape as a function of the fraction of the rich. In addition, an increase in the personal income of the rich together with a decrease in the fraction of the rich, keeping the aggregate income in the economy fixed, raises the well-being of the poor. I also analyze the effect of changes in market size and entry cost. I show that the rich gain more from an increase in market size and lose more from an increase in the cost of entry than the poor. CHAPTER 2: Globalization: Intensive versus Extensive Margins There is empirical evidence that globalization leads to higher income inequality within a country. However, in the economic literature not much attention is paid to the fact that globalization may influence inequality through the consumption channel. In particular, if different groups of consumers consume different sets of goods and in different amounts, then globalization can change consumption patterns and increase or decrease welfare inequality among the groups. In this essay, I look at two margins of globalization, namely trade liberalization (the intensive margin) and a rise in the number of trading partners (the extensive margin), and explore their impact on the economic well-being of different population groups through the consumption channel. I extend the model formulated in Chapter 1 to a world with many symmetric countries. I show that the impact of globalization on the relative welfare of the rich with respect to the poor depends on the margin of globalization considered. In particular, the relative welfare of the rich is first increasing and then decreasing as transportation costs fall. As for a rise in the number of trading partners, the rich always gain more than the poor. Moreover, in some cases the rich can even be worse off from trade liberalization, while welfare of the poor and aggregate welfare both increase. CHAPTER 3: Per Capita Income, Market Access Costs, and Trade Volumes In this essay, I document and analyze several phenomena of trade data. First, countries with higher per capita income tend to have greater trade volumes even after controlling for total income. Second, many country pairs in the world do not trade with each other in one or both directions. Finally, there are substantial costs of access to foreign markets. I construct and estimate a general equilibrium model of trade in an asymmetric world with many countries that squares the above data features. There are two novelties in the essay. First, in my model I introduce a relationship between the costs of access to foreign markets and exporter development level. I show that this relationship can account for the effect of per capita income on trade volumes and explain the many zeros in bilateral trade data. Second, I develop an estimation procedure, which allows me to identify separate effects of variable and fixed costs of trade on trade volumes. The model performs well in fitting the data. The trade elasticities with respect to aggregate and per capita incomes predicted by the model are close to those in the data. I find that the aggregate spending on access to foreign markets constitutes on average around the half of the total export profits.
Author : Moises Yi
Publisher :
ISBN 13 :
Total Pages : 128 pages
Book Rating : 4.:/5 (957 download)
Download or read book Essays in Labor Economics and International Trade written by Moises Yi and published by . This book was released on 2016 with total page 128 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation employs tools from Labor Economics and International Trade to study how workers and labor markets adjust to economic shocks arising from trade liberalization and technological change. It contributes to the existing literature by studying several economic mechanisms that determine the magnitudes of these adjustments. The first chapter of this dissertation analyzes the roles that skill transferability and the local industry mix have on the adjustment costs of workers affected by negative trade shocks. Using rich administrative data from Germany, we construct novel measures of economic distance between sectors based on the notion of skill transferability. We combine these distance measures with sectoral employment shares in German regions to construct an index of labor market flexibility. This index captures the degree to which workers from a particular industry will be able to reallocate into other jobs. We then study the role of labor market flexibility on the effect of import shocks on the earnings and the employment outcomes of German manufacturing workers. Among workers living in inflexible labor markets, the difference between a worker at the 75th percentile of industry import exposure and one at the 25th percentile of exposure amounts to an earnings loss of roughly 11% of initial annual income (over a 10 year period). The earning losses of workers living in flexible regions are negligible. These findings are robust to controlling for a wide array of region level characteristics, including region size and overall employment growth. Our findings indicate that the industry composition of local labor markets plays an important role on the adjustment processes of workers. In the second chapter, we develop and apply a framework to quantify the effect of trade on aggregate welfare as well as the distribution of this aggregate effect across different groups of workers. The framework combines a multi-sector gravity model of trade with a Roy-type model of the allocation of workers across sectors. By opening to trade, a country gains in the aggregate by specializing according to its comparative advantage, but the distribution of these gains is unequal as labor demand increases (decreases) for groups of workers specialized in export-oriented (import-oriented) sectors. The model generalizes the specific-factors intuition to a setting with labor reallocation, while maintaining analytical tractability for any number of groups and countries. Our new notion of "inequality-adjusted" welfare effect of trade captures the full cross-group distribution of welfare changes in one measure, as the counterfactual scenario is evaluated by a risk-averse agent behind the veil of ignorance regarding the group to which she belongs. The quantitative application uses trade and labor allocation data across regions in Germany to compute the aggregate and distributional effects of a shock to trade costs or foreign technology levels. For the extreme case in which the country moves back to autarky we find that inequality-adjusted gains from trade are larger than the aggregate gains for both countries, as between-group inequality falls with trade relative to autarky, but the opposite happens for the shock in which China expands in the world economy. In the third chapter, we use detailed production data from a large Latin American garment manufacturer to study the process of technology adoption and resulting productivity changes within a firm. We find that the adoption of modern manufacturing techniques increases productivity through two channels, a direct effect and a spillover effect across adjacent production units. By exploiting the gradual introduction of new manufacturing techniques across independent production units, we estimate a direct effect on productivity of roughly 30%. We also estimate large spillovers to neighboring untreated units which amount to a 25% increase in productivity. Both of these effects accumulate slowly over time. The timing and the magnitudes of the estimated spillover effects corroborate qualitative evidence consistent with knowledge diffusion, learning and imitation.
Author : Takashi Kamihigashi
Publisher : Springer Science & Business Media
ISBN 13 : 3540786767
Total Pages : 532 pages
Book Rating : 4.5/5 (47 download)
Download or read book International Trade and Economic Dynamics written by Takashi Kamihigashi and published by Springer Science & Business Media. This book was released on 2008-10-16 with total page 532 pages. Available in PDF, EPUB and Kindle. Book excerpt: Renowned trade theorist Koji Shimomura passed away in February 2007 at the age of 54. He published nearly 100 articles in international academic journals. The loss of this extremely productive economist has been an enormous shock to the economic profession. This volume has emerged from the great desire on the part of the profession to honor his contributions to economic research. Contributors include authoritative figures in trade theory such as Murray Kemp, Ronald Jones, Henry Wan, and Wilfred Ethier, world-renowned macroeconomists such as Stephen Turnovski and Costas Azariadis, and leading Japanese economists such as Kazuo Nishimura, Makoto Yano, Ryuzo Sato, and Koichi Hamada. This broad range of contributors reflects Koji Shimomura’s many connections as well as the respect he earned in the economic profession. This volume offers the reader a rare opportunity to learn the views of so many renowned economists from different schools of thought.
Author : Alain de Janvry
Publisher : Springer Science & Business Media
ISBN 13 : 0387297480
Total Pages : 390 pages
Book Rating : 4.3/5 (872 download)
Download or read book Poverty, Inequality and Development written by Alain de Janvry and published by Springer Science & Business Media. This book was released on 2006-06-09 with total page 390 pages. Available in PDF, EPUB and Kindle. Book excerpt: This collection of essays honors a remarkable man and his work. Erik Thorbecke has made significant contributions to the microeconomic and the macroeconomic analysis of poverty, inequality and development, ranging from theory to empirics and policy. The essays in this volume display the same range. As a collection they make the fundamental point that deep understanding of these phenomena requires both the micro and the macro perspectives together, utilizing the strengths of each but also the special insights that come when the two are linked together. After an overview section which contains the introductory chapter and a chapter examining the historical roots of Erik Thorbecke's motivations, the essays in this volume are grouped into four parts, each part identifying a major strand of Erik's work—Measurement of Poverty and Inequality, Micro Behavior and Market Failure, SAMs and CGEs, and Institutions and Development. The range of topics covered in the essays, written by leading authorities in their own areas, highlight the extraordinary depth and breadth of Erik Thorbecke's influence in research and policy on poverty, inequality and development. Acknowledgements These papers were presented at a conference in honor of Erik Thorbecke held at Cornell University on October 10-11, 2003. The conference was supported by the funds of the H. E. Babcock Chair in Food, Nutrition and Public Policy, and the T. H. Lee Chair in World Affairs at Cornell University.
Author : Oleg Itskhoki
Publisher :
ISBN 13 :
Total Pages : 372 pages
Book Rating : 4.:/5 (467 download)
Download or read book International Trade and Labor Markets written by Oleg Itskhoki and published by . This book was released on 2009 with total page 372 pages. Available in PDF, EPUB and Kindle. Book excerpt: International trade is typically believed to lead to aggregate welfare gains for trading countries. However, it is also often viewed as a source of growing social disparity--by causing unemployment and greater inequality within countries--which calls for an offsetting policy response. This dissertation consists of three theoretical essays studying these issues. The first chapter develops a model of international trade with labor market frictions that differ across countries. We show that differences in labor market institutions constitute a source of comparative advantage and lead to trade between otherwise similar countries. Although trade ensures aggregate welfare gains for both countries, the more flexible country stands to gain proportionately more. An increase in the country's labor market flexibility leads to welfare gains at home, but causes welfare losses in the trading partner via decreased competitiveness of foreign firms. Trade can increase or decrease unemployment by inducing an intersectoral labor reallocation generating rich patterns of unemployment.
Author : Kanit Kuevibulvanich
Publisher :
ISBN 13 :
Total Pages : 200 pages
Book Rating : 4.:/5 (1 download)
Download or read book Essays in the International Aspects of Macroeconomics written by Kanit Kuevibulvanich and published by . This book was released on 2017 with total page 200 pages. Available in PDF, EPUB and Kindle. Book excerpt: I examine the dynamic effects of trade liberalization on wealth inequality and welfare. In the first essay, I develop a heterogeneous agent model with an incomplete asset market, small open economy with two production sectors, specific-factor trade model with costly-switching sector-specific labor and perfectly mobile capital across sector and border, and iceberg cost as the trade barrier. Trade liberalization, defined as the elimination of trade barrier, leads to the change in the relative prices, the demand and supply for each good, as well as the relative wages and factor allocations in each sector. Households maximize their lifetime value using the accumulated wealth as means of switching to the more productive sector. In the second essay, I perform counterfactual analyses using the calibrated model constructed in the first essay. Measured by the Gini coefficient of wealth, trade liberalization initially increases wealth inequality before tapering towards a more equitable wealth distribution in the long run, despite the increase in between-sector wage inequality. The counterfactual analysis demonstrates a peak increase in wealth inequality of 0.7% at 3 years after the policy implementation, but a 0.3% decrease in the long run. Comparing the steady states, trade liberalization leads to an average of 1.3% welfare improvement across all households, measured by the consumption equivalent variation. However, not all households benefit from the trade liberalization policy. In the third essay, I investigate the implication between the core and headline inflation in three aspects. First, while theories suggest the use of core inflation in forecasting total inflation as it represents the persistent components of the price level, I find from the data that core inflation is not necessarily a good forecasting measure in all countries. Second, I find the pass-through effect from total price level to core prices, suggesting the transmission from transitory components to persistent components of the price level. Third, I analyze the baseline Aoki (2001) model with sticky-price and flexible-price sectors. Although numerical result confirms the theoretical findings that core inflation targeting is the optimal monetary policy, the welfare loss resulting from the use of headline inflation as the target is small.
Author : Mingzhi Xu
Publisher :
ISBN 13 : 9780438291171
Total Pages : pages
Book Rating : 4.2/5 (911 download)
Download or read book Essays on Economic Integration and Inequality written by Mingzhi Xu and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Economic activities worldwide are becoming increasingly integrated, in terms of freely traded consumption, globalized production as well as information sharing alike. The tightened linkages are thought to improve resource allocation, promote technology transfer and enhance living standard, while the challenge for policymakers is to ensure that these benefits are sufficiently widely shared. It highlights the importance of understanding how economic integration affects labor. My dissertation focuses on the how integration shapes the organization of production and the effects on the well-being. The first chapter focuses the impacts of integration by removing information transmission barrier on the diffusion of economic activities as well as its welfare and inequality consequence. The paper studies the aggregate and distributional impacts of high-speed railways (HSR) in an economy with internal trade and migration costs. I make two contributions to the understanding of the impacts of large transportation infrastructure projects. Firstly, taking advantage of the rapid expansion as plausible exogenous shocks that improves firm-to-firm matching efficiency across regions over time, I identify the causal relationship between HSR connection and exporting performance in case of China. We find the connection to HSR significantly promotes a region's exports. Besides the direct impact, I also find the positive spillovers of HSR, and such effect is stronger in areas closer to HSR hubs. Our second contribution is to shed light on the mechanisms at work by relating the HSR-driven regional outsourcing to the HSR-driven increases in welfare and inequality. To do so, I construct and calibrate a quantitative spatial equilibrium model with producer-supplier linkage, taking care of trade, migration, and outsourcing in a unified framework to examine the general equilibrium effects of the HSR and to perform counterfactuals. Chapter 2 studies the role of international trade for household income polarization, the phenomenon in which the size of high- and low-income groups increases but mid-income group declines. I propose a new channel that emphasizes the supply change of skills in rationalizing the phenomenon. We build a simple theory of trade featuring endogenous choices on occupation and firm productivity. In the model, individuals choose to become low-skilled, high-skilled workers, or entrepreneurs based on their innate abilities. Entrepreneurs improve the firm efficiency by investing in the managerial effort. I show that while the households with high human capital optimally respond to export opportunity by moving up the income distribution, other households with median level human capital self-select downward the income distribution, the long run consequence of which may be the polarization in labor market. An empirical test of the model reveals that Chinese regions facing more export exposure exhibit stronger pattern of labor market polarization. While my first two research focus on the welfare changes within-country in case of the largest developing country in the world, China, my third part of dissertation compares a country's living standard in an international framework. Chapter 3, a joint work with my advisor Robert Feenstra and Alexis Antoniades, compares the cost of living for cities in China and in the United States using barcode data, as a complement to the International Comparisons Program (ICP) supervised by the World Bank. We find that, in both countries, there is a greater variety of products in larger cities. But in China, unlike the United States, the prices of products tend to be lower in larger cities. We attribute the lower prices to a pro-competitive effect, whereby larger cities attract more brands and retailers which leads to lower markups and prices. Combining the effect of greater variety and lower prices, it follows that the cost-of-living for grocery-store products in China is lower in larger cities. We further compare the cost-of-living indexes for particular product categories between China and the United States. In product categories with a significant presence of U.S. brands in the Chinese market, the availability of additional Chinese brands leads to greater variety than in the United States, and therefore lower Chinese price indexes for that reason. In product categories with much less presence of U.S. brands in the Chinese market, however, the observed prices differences between the countries (usually lower prices in China) are partially or fully offset by the variety differences (less variety in China), so that the cost of living in China is not as low as the price differences suggest, especially in smaller cities.
Author : Ann Harrison
Publisher : University of Chicago Press
ISBN 13 : 0226318001
Total Pages : 674 pages
Book Rating : 4.2/5 (263 download)
Download or read book Globalization and Poverty written by Ann Harrison and published by University of Chicago Press. This book was released on 2007-11-01 with total page 674 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the past two decades, the percentage of the world’s population living on less than a dollar a day has been cut in half. How much of that improvement is because of—or in spite of—globalization? While anti-globalization activists mount loud critiques and the media report breathlessly on globalization’s perils and promises, economists have largely remained silent, in part because of an entrenched institutional divide between those who study poverty and those who study trade and finance. Globalization and Poverty bridges that gap, bringing together experts on both international trade and poverty to provide a detailed view of the effects of globalization on the poor in developing nations, answering such questions as: Do lower import tariffs improve the lives of the poor? Has increased financial integration led to more or less poverty? How have the poor fared during various currency crises? Does food aid hurt or help the poor? Poverty, the contributors show here, has been used as a popular and convenient catchphrase by parties on both sides of the globalization debate to further their respective arguments. Globalization and Poverty provides the more nuanced understanding necessary to move that debate beyond the slogans.
Author : Gulfer Cengiz
Publisher :
ISBN 13 :
Total Pages : 186 pages
Book Rating : 4.:/5 (688 download)
Download or read book Essays on International Trade and Intergenerational Human Capital Transmission written by Gulfer Cengiz and published by . This book was released on 2010 with total page 186 pages. Available in PDF, EPUB and Kindle. Book excerpt: First chapter aims to quantify the role of trade in capital goods in cross country income differences. I construct a multi-country general equilibrium model of trade along the line of Eaton and Kortum (2002) and Alvarez and Lucas (2007) and introduce trade in capital goods and capital accumulation. In this framework, comparative advantage and the costs of international trade determine the pattern of production, specialization, and trade. I calibrate the model for 53 countries by estimating trade barriers and calibrating productivity parameters to match the bilateral trade data in 1996. The model is used to analyze full trade liberalizations. I find that removing barriers on investment goods accounts a large portion of reducing cross-country income differences and welfare gain. Counterfactual exercises suggest that developing countries gain relatively more than developed countries. In the second chapter, I focus on the impact of free trade on export-import ratios in two different sectors. I employ a multi-country general equilibrium model of bilateral trade patterns along the line of Eaton and Kortum (2002) and Alvarez and Lucas (2007). I calibrate the model for 20 countries by estimating trade barriers and calibrating productivity parameters to match the bilateral trade data in 1996. The model is used to analyze full trade liberalizations. The impacts of free trade are predicted to be an increase in the export-import ratios in the comparative advantage sector and a decline in the comparative disadvantage sector, on average. In developing countries the average percentage change in export-import ratios exceeds the average percentage change in export-import ratios in developed countries. Finally, in the third chapter, I focus on the intergenerational human capital transmission. I develop and calibrate a theoretical model that considers three mechanisms of intergenerational transmission of human capital: (i) persistence in learning ability; (ii) parental investment in child's human capital; (iii) higher teaching productivity of parents with more human capital. Within this framework, I find that (i) and (ii) plays important roles while (iii) does not. In addition the model generates the documented fact that higher-wage parents spending more time teaching their children in spite of the higher opportunity cost. I assess the role of nature and nurture effects in intergenerational persistence of earnings and I find that nature accounts a large portion of the intergenerational persistence in earnings. I also quantify the relative importance of these mechanisms on wage inequality.
Author : Ms.Era Dabla-Norris
Publisher : International Monetary Fund
ISBN 13 : 1513547437
Total Pages : 39 pages
Book Rating : 4.5/5 (135 download)
Download or read book Causes and Consequences of Income Inequality written by Ms.Era Dabla-Norris and published by International Monetary Fund. This book was released on 2015-06-15 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes the extent of income inequality from a global perspective, its drivers, and what to do about it. The drivers of inequality vary widely amongst countries, with some common drivers being the skill premium associated with technical change and globalization, weakening protection for labor, and lack of financial inclusion in developing countries. We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class. To tackle inequality, financial inclusion is imperative in emerging and developing countries while in advanced economies, policies should focus on raising human capital and skills and making tax systems more progressive.
Author : C. Fred Bergsten
Publisher : Peterson Institute
ISBN 13 : 0881326623
Total Pages : 248 pages
Book Rating : 4.8/5 (813 download)
Download or read book Global Economics in Extraordinary Times written by C. Fred Bergsten and published by Peterson Institute. This book was released on 2012-11-15 with total page 248 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over five decades, John Williamson has written across an extraordinarily broad set of topics in international economics ranging from international monetary economics to development policy. The arc of his scholarship follows the main preoccupations of international economists during the second half of the 20th century and the first decade of the 21st. Bridging the scholarly literature and policy debates, his publications on the Washington Consensus, exchange rate policy, and international monetary reform have profoundly influenced public discourse, government policy, and the evolution of the economics discipline. As John marked his 75th birthday, his friends and colleagues prepared this collection of essays to celebrate these many contributions and reflect on their relevance to the challenges that confront the world economy in the wake of the 2008 09 global financial crisis and its current aftermath in Europe.
