Tariff Reforms with Rigid Wages

This paper analyses the effects of tariff reforms on welfare and market access in a competitive small open economy that is characterised by involuntary unemployment due to non-market clearing wages that are fixed either in terms of the numeraire or in real terms. We show that recent tariff-reform results can be extended to integrated reforms of tariffs and the wage rate, and that the inherent tension between reforms that increase welfare and market access carry over. We also derive welfare increasing tariff-reform strategies that keep the wage rate constant, and show that this tension may be attenuated.Tariff Reform, Unemployment, Small Open Economy

The Impact of Financial Market Frictions on Trade Flows, Capital Flows and Economic Development

We document that, at business cycle frequencies, fluctuations in nominal variables, such as aggregate price levels and nominal interest rates, are substantially more synchronized across countries than fluctuations in real output. To the extent that domestic nominal variables are largely determined by domestic monetary policy, this might seem surprising. We ask if a parsimonious international business cycle model can account for this aspect of cross-country aggregate fluctuations. It can. Due to spillovers of technology shocks across countries, expected future responses of national central banks to fluctuations in domestic output and inflation generate movements in current prices and interest rates that are synchronized across countries even when output is not. Even modest spillovers produce cross-country correlations such as those in the data.International business cycles, prices, interest rates.

The Impact of Financial Market Frictions on Trade Flows, Capital Flows and Economic Development

We introduce financial frictions in a two sector model of international trade with heterogeneous agents. The level of specialization in the economy (economic development) depends on the quality of financial institutions. Underdeveloped financial markets prohibit an economy to specialize in sectors where finance is important. Capital flows and international trade are complements when countries differ in the degree of development of their financial sectors. Capital flows to countries with more robust financial institutions which in turn allow their economies to develop sectors that are financially dependent.trade flows, capital flows, financial frictions, economic development

Rules of Origin as Commercial Policy Instruments.

This paper examines the role of Rules of Origin as a commercial policy instrument which targets the input composition of imports. Using a three country, partial equilibrium structure, we demonstrate conditions under which the imposition of a binding Rule will be welfare improving for an importer facing either competitive export suppliers or an export monopolist. We also show that employing Rules of Origin in this way would be complementary to, rather than a substitute for, conventional optimal tariffs.

Exploratory studies into possible uses of calcareous dolostone on the Shivwits Plateau

Excavations at pueblo habitation sites on the Shivwits Plateau suggest that calcareous dolostone was regularly procured and used by the inhabitants of the Mt. Dellenbaugh region. Calcareous dolostone, a soft, powdery calcium carbonate, is not local to these sites but was presumably procured from somewhere beneath the rim of the Grand Canyon. In this poster, we present the results of exploratory experiments into possible uses of this resource. Specifically, we evaluate the performance characteristics of powdered dolostone with reference to two activities: pigment production and ceramic manufacture

Financial Constraints, the Distribution of Wealth and International Trade

We develop a simple theoretical model to examine the impact of the distribution of wealth on the patterns of trade when capital markets are imperfect. Our model predicts that the dispersion of wealth can be a determinant of comparative advantage for low-income countries with poor financial institutions. We find support for these prediction using export and financial panel data from a large sample of countries.