Technical regulations and specialization in international trade

It is widely acknowledged that while technical regulations can improve welfare and facilitate markets, they can also impede trade. The trade impeding effects of technical regulations are especially worrisome for developing countries: they frequently lack the human and capital resources necessary to satisfy technical measures, and thus are more likely to be excluded from markets by technical measures. This paper uses highly disaggregated US data on agricultural, mining and manufacturing imports to examine the impact of technical regulations on trade patterns. Using instrumental variables estimation to correct for the potential endogeneity of technical regulations, the analysis suggests that technical regulations substantially impinge on poor countries' exports: their weaker capacities to satisfy technical regulations lead them to specialize away from industries with heavier regulatory burdens.International trade Technical regulations Comparative advantage Developing countries Non-tariff barriers F13 O24 O19

Trade Liberalization, Standards and Protection

As conventional trade barriers fall, nations may increasingly resort to product standards to protect domestic industries. While ostensibly protecting their citizens from the environmental and health side-effects of a particular product, countries could enact standards that are facially-neutral, but impose greater compliance costs on foreign producers. This paper examines the impact of trade liberalization on standard setting by using a two-country Cournot duopoly model in which the Domestic government imposes a standard to mitigate a consumption externality. The standard increases production costs for both Domestic and Foreign firms, especially for the latter. The paper finds that one cannot make an unequivocal connection between falling tariffs and subsidies and rising standards. If the initial tariffs or subsidies are prohibitive, reducing subsidies and tariffs to allow minimal import penetration will generally create incentives for the Domestic government to impose higher standards. If the ex ante tariffs are not prohibitive, however, it is only optimal for the government to raise standards following tariff cuts if (i) tariff revenues are an important component of the welfare calculus and the ex ante tariff rate is high, or (ii) the standard's effect on the per unit externality is large. Likewise, if the initial subsidies are small enough to allow imports the government should only raise standards following subsidy reductions if the per unit externality is substantial, or the standard's impact on the per unit externality is large.

Equality through exposure to imports? International trade and the racial wage gap

A key implication of Becker's (1957) work on discrimination is that greater product market competition can reduce employment discrimination generally, and discriminatory wage gaps in particular. Using US data on manufacturing wages and import exposure, we explore whether increased competition, in the form of a heightened exposure to imports, reduces the racial wage gap. Our findings support Becker's contention. We find that import exposure helped narrow the racial wage gap by about 1.4 percentage points between 1983 and 1993. The effect is especially pronounced among the most disadvantaged: unskilled Southern workers. For them, import exposure helped reduce racial wage disparities by 2.2 percentage points.discrimination, international trade, globalization,

Slavery, Institutional Development,

Can Africa's current state of under-development be partially attributed to the large trade in slaves that occurred during the Atlantic, Saharan, Red Sea and Indian Ocean slave trades? To answer this question, I combine shipping data with historical records that report slave ethnicities and construct measures of the number of slaves exported from each country in Africa between 1400 and 1913. I find the number of slaves exported from a country to be an important determinant of economic performance in the second half of the 20th century. To correct for potential biases arising from measurement error and unobservable country characteristics, I instrument slave exports using measures of the distance from each country to the major slave markets around the world. I also find that the importance of the slave trade for contemporary development is a result of its detrimental impact on the formation of domestic institutions, such as the security of private property, the quality of the judicial system, and the overall rule of law. This is the channel through which the slave trade continues to matter today

Commercial Imperialism? Political Influence and Trade During the Cold War: Dataset.” American Economic Review.

History provides us with many examples of the use of political power to promote trade and other national interests, the starkest being the unequal treaties imposed by Western powers on China and Japan during the nineteenth and early twentieth centuries (Findlay and O'Rourke 2007). However, the general question of whether power is an important determinant of international trade, particularly in the more recent past, is difficult to examine empirically because shifts in power relations between governments are often the result of decisions that are made behind the veil of government secrecy. In this paper, we surmount this problem by relying on the use of recently declassified CIA documents to generate a country-and year-specific measure of the influence of the US government over foreign countries. We identify instances where US covert services engaged in interventions that installed and/or supported political leaders in [email protected]). We thank four anonymous referees for comments and suggestions that significantly improved the paper. We also thank J