The European Neighborhood policy: towards a new EU-MED partnership?

The aim of the present work is to test empirically the feasibility of the broad expectations regarding the effects of ENP on the EU-MED economic partnership. More specifically, it presents firstly a gravity analysis of the patterns of trade in the EU-MED area to test the actual dimension of unexploited trade as well as the level of trade potentials after the ENP and the EU-MED FTA will take place. Secondly, it analyzes the relative degree of macroeconomic instability in the region by checking the patterns of volatility of per capita consumption in the EU-MED partner countries. The gravity estimates show the existence of a large amount of unexploited trade in the context of the EU-MED partnership but a slow pace of exports’ growth performance driven by ENP and EU-MED FTA project, even in the most “optimistic” scenario. The analysis of volatility highlights the MPs low ability to maintain a stable path of consumption. Thus, MPs remain more exposed to the occurrence of the external negative covariate shocks, associated with trade liberalization, with a strong probability of long term negative effects in aggregate welfare, even in a context of positive growth. According to these first results, ENP seems to be unfit to promote further integration and liberalization in the area as well as the “stake in the internal market” for MPs. It undermines a number of key issues and collateral policies which remain fundamental for the success of the EU-MED integration process, such as the role of regional South-South integration and the adoption of early warning mechanisms and preventive policies to reduce the probability of negative shocks induced by trade liberalization.European Neighborhood Policy, EU MED Partnership, Gravity Model, International Trade, Macro Volatility

Trade patterns and trade clusters: China, India, Brazil and South Africa in the global trading

The present paper analyzes the evolution of the specialization and trade patterns of China, India, Brazil and South Africa (CIBS) and other WTO countries. It aims to provide an answer to the following questions: is there a tendency to a multi-polarization of trade patterns? If so, is CIBS’ rise leading to new clusters with or among CIBS or other emerging countries? Also, ultimately, does this multi-polarization have a regional element to it? The paper deals with the above questions by presenting: i) a world map of trade clusters involving WTO countries and CIBS; ii) a comparison of the above clusters and their key characteristics in the last decade; and iii) the key drivers of clusters’ trends. The novelty of this study is twofold: first, it adopts a more comprehensive dataset for a wide range of countries and trade dimensions; second, it provides an evolutionary look at the clusters’ trends. The empirical results do not show neither a remarkable phenomenon of multi-polarization, nor evidence of CIBS as a significant separate group and/or regional agglomerationCIBS, trade patterns, trade specialization, cluster

Does trade opennes increase vulnerability? A survey of the literature

This work focuses on the welfare costs of exposure to shocks and uncertainty linked to trade opennes - a prominent issue in the international debate. It contributes by presenting a comprehensive review of the literature on the "destabilizing effects" of trade openness, drawing together studies in different fields. It provides a conceptualization of vulnerability and three promising lines of reasoning for future research on the link between trade and vulnerability.vulnerability, trade openness, volatility, crisis transmission, developing countries

The effects of global value chain (GVC) participation on the economic growth of the agricultural and food sectors

Trade liberalization has long been advocated as a means to foster growth and welfare. In developing countries, the expansion of global value chain (GVC) participation of agriculture and food sectors could support transformation from a subsistence-oriented and farm-centred system to a commercialized, productive and off-farm centred one. While empirical evidence examining the linkages between GVC participation and economic performance in the agricultural sector has traditionally relied on case studies at the product level, the availability of new aggregate data on trade in value added, now provides an unprecedented opportunity to carry out a global empirical assessment of the linkages. The present paper examines new measures of GVCs participation and positioning from the EORA panel data for the period 1995–2015 (Nenci, 2020) and tests their effects on changes in agriculture value added per worker. The results show that changes in GVC participation are, on average and ceteris paribus, positively associated with changes in agriculture value added per worker, net to time-invariant confounders, whereas mixed results are found on the effects of countries’ positioning along the value chain. In the conclusive remarks, the authors argue that import tariff and non-tariff barriers – including barriers to service trade – should be seen as the first obstacle to increase GVC participation and improve domestic value added. The presence of signs of heterogeneity by geographical location confirms that general universal recipes do not exist

Trade Openness and Vulnerability in Central and Eastern Europe

international trade, vulnerability, volatility, Central and Eastern European countries

The European Neighborhood policy: towards a new EU-MED partnership?

The aim of the present work is to test empirically the feasibility of the broad expectations regarding the effects of ENP on the EU-MED economic partnership. More specifically, it presents firstly a gravity analysis of the patterns of trade in the EU-MED area to test the actual dimension of unexploited trade as well as the level of trade potentials after the ENP and the EU-MED FTA will take place. Secondly, it analyzes the relative degree of macroeconomic instability in the region by checking the patterns of volatility of per capita consumption in the EU-MED partner countries. The gravity estimates show the existence of a large amount of unexploited trade in the context of the EU-MED partnership but a slow pace of exports’ growth performance driven by ENP and EU-MED FTA project, even in the most “optimistic” scenario. The analysis of volatility highlights the MPs low ability to maintain a stable path of consumption. Thus, MPs remain more exposed to the occurrence of the external negative covariate shocks, associated with trade liberalization, with a strong probability of long term negative effects in aggregate welfare, even in a context of positive growth. According to these first results, ENP seems to be unfit to promote further integration and liberalization in the area as well as the “stake in the internal market” for MPs. It undermines a number of key issues and collateral policies which remain fundamental for the success of the EU-MED integration process, such as the role of regional South-South integration and the adoption of early warning mechanisms and preventive policies to reduce the probability of negative shocks induced by trade liberalization

Essays on trade openness and vulnerability to poverty

This thesis focuses on the welfare costs of exposure to risk linked to openness to international trade. This is a prominent issue in international debate, whereas it is largely ignored by trade literature, both theoretical and empirical. Trade theory is mainly focused on the first moment of the above relationship, which is actually insufficient for welfare purposes when people are risk averse. Empirical evidence is mixed, scattered in separate fields of analysis, and does not reach a common stance. As a result, current literature fails to make a full assessment of the net welfare impact of an opening-up process. This work contributes to the above debate by proposing: • A comprehensive review of the literature on the “destabilising effects” of openness to international trade; • An empirical test on the significance and relevance of “precautionary saving” behaviour under risk, estimated from cross-country data; • A conceptualisation of vulnerability to poverty induced by trade openness; • A comprehensive analysis of vulnerability to poverty induced by trade liberalisation in Vietnam under Doi Moi,¹ by exploiting the available household living standard surveys for the period 1992-2008; • An extended version of Ligon and Schechter’s (2003) measure of Vulnerability as low Expected Utility; • An empirical application of the adjusted VEU measure to “trade-induced vulnerability” using VHLSS panel data (2002-06) The work is divided into four essays as follows: 1. Review of the literature and conceptualisation (and misconceptions) of “trade induced vulnerability to poverty” (Essay 1); 2. A cross-country empirical test in the long-run behaviour of consumption under risk (Essay 2); 3. A cross-sectional empirical test of trade-induced vulnerability in Vietnam under Doi Moi (period 1992-2008) (Essay 3); 4. A panel empirical test of trade-induced vulnerability in Vietnam in the period 2002-06 (Essay 4). ¹“Doi Moi” (renovation) was a comprehensive process of reforms undertaken from the early 1990s by Vietnam characterised by a combination of liberalisation, stabilisation and structural reforms

Spatial heterogeneity in price (dis)incentives: evidence from the Ugandan maize value chain

Impact assessments of policy interventions on agricultural commodity prices are carried out by international organizations using nationwide measures which overlook the effects of spatial heterogeneity in incomplete markets. We introduce a multi-step methodology to build spatially-disaggregated nominal rates of protection in a data-scarce environment and test it along the maize value chain in Uganda. Results confirm that the spatial dispersion of farmers plays a key role in determining heterogeneity in nominal rates of protection. This finding has far-reaching policy implications: i) the assumption of a nationally representative market pathway is unrealistic; ii) pan-national interventions may exacerbate, rather than reduce, price distortions

The European Neighborhood policy: towards a new EU-MED partnership?

The aim of the present work is to test empirically the feasibility of the broad expectations regarding the effects of ENP on the EU-MED economic partnership. More specifically, it presents firstly a gravity analysis of the patterns of trade in the EU-MED area to test the actual dimension of unexploited trade as well as the level of trade potentials after the ENP and the EU-MED FTA will take place. Secondly, it analyzes the relative degree of macroeconomic instability in the region by checking the patterns of volatility of per capita consumption in the EU-MED partner countries. The gravity estimates show the existence of a large amount of unexploited trade in the context of the EU-MED partnership but a slow pace of exports’ growth performance driven by ENP and EU-MED FTA project, even in the most “optimistic” scenario. The analysis of volatility highlights the MPs low ability to maintain a stable path of consumption. Thus, MPs remain more exposed to the occurrence of the external negative covariate shocks, associated with trade liberalization, with a strong probability of long term negative effects in aggregate welfare, even in a context of positive growth. According to these first results, ENP seems to be unfit to promote further integration and liberalization in the area as well as the “stake in the internal market” for MPs. It undermines a number of key issues and collateral policies which remain fundamental for the success of the EU-MED integration process, such as the role of regional South-South integration and the adoption of early warning mechanisms and preventive policies to reduce the probability of negative shocks induced by trade liberalization

Are EU trade preferences really effective? A Generalized Propensity Score evaluation of the Southern Mediterranean countries' case in agriculture and fishery

The aim of this work is to assess the trade impact of preferential schemes. It focuses on the controversial case of the trade preferences in agriculture and fishery granted by the European Union (EU) to the Southern Mediterranean Countries (SMCs) over the period 2004-2009. The analysis presents several methodological improvements on previous works. The results show that the impact of the EU preferences in agriculture and fishery granted to SMCs is significant on SMCs trade flows and that is better evaluated by using impact evaluation techniques. Findings raise important issues for policy-making by mitigating the claimed efficiency of the EU trade policy in the Mediterranean area.JRC.J.4-Agriculture and Life Sciences in the Econom