216 research outputs found
Trade as international transmission mechanism of shocks: The case of Central Eastern European Countries
On Productivity Measurement and Interpretation: Some Insights on Italy in the European Context. LEQS Paper No. 142/2019 March 2019
Over the period 1995â2016, the Italian performance in terms of productivity was poor in
historical terms and in comparison with its main international partners. This issue goes beyond
Italy, with declining productivity growth observed, from the second half of the nineties, in
several other advanced economies. Possible explanations for the slowdown include factors
such as lower capital investment by firms, decreased competition, excessive regulation, and
capital misallocation. The diffuse slowing rates of measured productivity growth has also
raised questions on whether GDP and output current compilation methods are adequate (i.e.
the mis-measurement hypothesis). The âICT revolutionâ has created new ways of exchanging
and providing goods and services as result of increased connectivity. These developments
challenge the way economic activity is traditionally measured. There are also measurement
problems associated with estimating output and input volumes especially related to the quality
of price indexes for some products and services. These problems have an impact on
productivity estimates and might impair international comparability. In this paper, we intend to
investigate what the core problems in productivity measurement and interpretation are in the
European context, with a specific focus on Italy
Growth divergence and income inequality in OECD countries: the role of trade and financial openness. LEQS Paper No. 148/2018 October 2019
This paper analyses trade and financial openness effects on growth and income
inequality in 35 OECD countries. Our model takes into account both short run and long
run effects of factors explaining income divergence between and within the countries.
We estimate, for the period 1995-2016, an error correction model in which per capita
GDP and inequality are driven by changes over time of selected factors and by the
deviation from a long run relationship. Stylised facts suggest that trade and financial
openness reduce the growth gaps across the countries but not income inequality, and
the effects of finance are stronger in high income countries. Nevertheless, low and
middle income countries benefit more from international trade. Our contribution to the
existing literature is threefold: i) we study the short and long run effects of trade and
financial openness on income level and distribution, ii) we focus on developed
countries (OECD) rather than on developing and iii) we provide a sensitivity analysis
including in our baseline equation an institutional indicator, a trade agreement proxy
and a dummy of global financial crisis. Estimates results indicate that trade openness
significantly improved the conditions of OECD low income countries both in short and
long run mostly, consistently with the catching up theory. It also decreased inequality,
but only in low and middle income countries. Differently financial openness had a
positive and significant impact only in the short run on middle income countries and
increased income disparities within countries in the short term in low income countries
and in the long term in high income countries
The Euro's Effects on Trade in a Dynamic Setting
This paper provides an update on estimates of the euro effect on trade integration among EMU economies, taking into account the aggregate bilateral exports of 23 OECD countries for the sample period 1988-2004. We consider 13 exporting European countries and 23 importing industrialized countries We utilize the dynamic panel data estimator proposed by Blundell and Bond (1998) and introduce controls for heterogeneity. The results of our dynamic specification of the gravity equation yield an estimate of the short run intra-Eurozone pro-trade effect, following the adoption of the single currency, which is as high as around 4% (17% in the long run). This finding, slightly lower than the results set out in our previous studies, is in line with those of very recent empirical analyses using dynamic specification of the gravity equation. It is also consistent with the already tight trade links characterizing the economies that have adopted the euro.International trade ; currency unions ; gravity models ; dynamic panel data
Current Account âCore-Periphery Dualismâ in the EMU. CEPS Working Document No. 406/March 2015
Current account dispersion within EU member states has been increasing since the 1990s. Interestingly, the persistent deficits in many peripheral countries have not been accompanied by a significant growth process that is able to stimulate a long-run rebalancing, as neoclassical theory predicts. To shed light on the issue this paper investigates the determinants of eurozone current account imbalances, focusing on the role played by financial integration. The analysis considers two samples of 22 OECD and 15 EU countries; three time horizons corresponding to various steps in European integration; different control variables; and several panel econometric methods. The results suggest that within the OECD and EU groups, financial integration helped to explain CA deterioration in the peripheral countries, especially in the post-EMU period. The business cycle seems to have played a growing role over time, whereas the role of competiveness seems to have diminished
Current account âCore-periphery dualismâ in the EMU. LEQS Discussion Paper No. 90/2015 March 2015
Current account (CA) dispersion within European Union (EU) member states has been
increasing progressively since the 1990s. Interestingly, the persistent deficits in many
peripheral countries have not been accompanied by a significant growth process able to
stimulate a long run rebalancing as neoclassical theory predicts. To shed light on the issue
this paper investigates the determinants of Eurozone CA imbalances, focusing on the role
played by financial integration. The analysis considers two samples of 22 OECD and 15 EU
countries, three time horizons corresponding to various steps in European integration,
different control variables and several panel econometric methods. The results suggest that
within the OECD and EU groups, financial integration contributed to explain CA
deterioration in the peripheral countries especially in the post-EMU period. The business
cycle seems to have played a growing role over time, whereas the role of competiveness
seems to have diminished with respect to the past
Environmental Policies, Innovation and Productivity in the EU. LEQS Discussion Paper No. 100/2015 November 2015
In this paper we test the weak Porter hypothesis on a sample of European economies in the
period 1995-2008. We focus on the channels through which tighter environmental regulation
affects productivity and innovation. Our findings suggest that the âweakâ Porter hypothesis
cannot be rejected and that the choice of policy instruments is not neutral. In particular,
market based environmental stringency measures seem to be the most suitable to stimulate
innovation and productivity growth. Consistently with the strategic reorientation of
environmental policies in the European Union since the end of the eighties, our results
indicate that the EU might privilege market based instruments in order to meet more
effectively the 2030 targets, especially through the channels of innovation and productivity
enhancement
Impact of environmental regulations on trade in the main EU countries: conflict or synergy?
In an increasingly integrated world with declining trade barriers, environmental regulations can have a decisive role in shaping countriesâ comparative advantages. The conventional wisdom about environmental protection is that it comes at an additional cost on firms imposed by the government, which may erode their global competitiveness. However, this paradigm has been challenged by some analysts. In particular, Porter (1991) and Porter and Van der Linde (1995) argue that pollution is often associated with a waste of resources and that more stringent environmental policies can stimulate innovations that may over-compensate for the costs of complying with these policies. This is known as the Porter hypothesis.
While there is a broad empirical literature on the impact of trade on environment the empirical literature on the impact of environmental regulations on trade flows is relatively scarce, very heterogeneous and presents mixed results. The innovative feature of this paper is its attempts to estimate, in a gravity setting, augmented with a proxi of environmental stringency, the impact of three major Multilateral Environmental Agreements (MEAs) on 15 EU countries bilateral exports.
According to our estimates, in the period 1988-2008, to be member of MEAs had a positive average impact on EU15 bilateral exports. This evidence can be partly explained by a possible trade diversion effect with respect to countries that did not sign MEAs, and a corresponding trade creation effect among members of the environmental agreements. Furthermore, evidence coming from interaction effects estimates seems to show that for exporting countries having signed the UNFCCC and the Montreal agreements, partly mitigates (by the amount of the estimated coefficient ) the negative impact of having a relatively more stringent environmental regulation on bilateral trade. This result could have important policy implications for the future international trade- environmental negotiations
Trade, FDI, growth and biodiversity: an empirical analysis for the main OECD countries.
Whether the Environmental Kutznets curve relationship holds for biodiversity or not remains an open issue. While there are several studies investigating the EKC relationship for biodiversity, they suffer from some limitations and the empirical evidence is inconclusive. More specifically, with few exceptions, the previous EKC studies for biodiversity looked into the diversity of a particular species or a number of species rather than a broader measure of biodiversity. In addition, these studies do not control for some economic factors that could directly or indirectly affect the biodiversity stock such as trade and foreign direct investments (FDI). International trade, in fact, could influence the biodiversity trough the effects on economic growth, production specialization and technological innovation diffusion. The presence or not of FDI in a country could be of help in assessing the âpollution havenâ hypothesis that has obvious feedbacks on biodiversity.
The innovative features of this paper are its attempts to estimate a ECK for biodiversity using an overall index of biodiversity terrestrial and marine and the inclusion in the traditional ECK equation of proxies for trade and FDI. According to our estimates for the main OECD countries in the period 1990-2010, the ECK hypothesis is partially verified. Rising incomes are first associated with increasing biodiversity then with decreasing biodiversity and eventually with increasing biodiversity again. This non-monotonic relationship could be explained by the fact that a certain level of income (production) there may be some biodiversity losses that cannot be continuously substituted with environmental-friendly production technology due to ecological threshold and the unique nature of the damage
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