The growth of bilateralism

One of the most notable international economic events over the past 20 years has been the proliferation of bilateral free trade agreements (FTAs). Bilateral agreements account for 80 percent of all agreements notified to the WTO, 94 percent of those signed or under negotiation, and currently 100 percent of those at the proposal stage. Some have argued that the growth of bilateralism is attributable to governments having pursued a policy of “competitive liberalization" - implementing bilateral FTAs to offset potential trade diversion caused by FTAs of “third-country-pairs" - but the growth of bilateralism can also be attributed potentially to “tariff complementarity" - the incentive for FTA members to reduce their external tariffs on nonmembers. Guided by new comparative statics from the numerical general equilibrium monopolistic competition model of FTA economic determinants in Baier and Bergstrand (2004), we augment their parsimonious logit (and probit) model of the economic determinants of bilateral FTAs to incorporate theory-motivated indexes to examine the influence of existing memberships on subsequent FTA formations. The model can predict correctly 90 percent of the bilateral FTAs within five years of their formation, while still predicting “No-FTA" correctly in 90 percent of the observations when no FTA exists, using a sample of over 350,000 observations for pairings of 146 countries from 1960-2005. Even imposing the higher correct prediction rate of “No-FTA" of 97 percent in Baier and Bergstrand (2004), the parsimonious model still predicts correctly 75 percent of these rare FTA events; only 3 percent of the observations reflect a country-pair having an FTA in any year. The results suggest that - while evidence supports that “competitive liberalization" is a force for bilateralism - the effect on the likelihood a pair of countries forming an FTA of the pair's own FTAs with other countries (i.e., tariff complementarity) is likely just as important as the effect of third-country-pairs' FTAs (i.e., competitive liberalization) for the growth of bilateralism

Evaluation of Pyrrones as membranes

Evaluation of Pyrrones as membranes for water purificatio

A generalization of the Lyndon--Hochschild--Serre spectral sequence with applications to group cohomology and decompositions of groups

We set up a Grothendieck spectral sequence which generalizes the Lyndon--Hochschild--Serre spectral sequence for a group extension K\mono G\epi Q by allowing the normal subgroup $K$ to be replaced by a subgroup, or family of subgroups which satisfy a weaker condition than normality. This is applied to establish a decomposition theorem for certain groups as fundamental groups of graphs of Poincar\'e duality groups. We further illustrate the method by proving a cohomological vanishing theorem which applies for example to Thompson's group $F$.Comment: 22 page

Do free trade agreements actually increase members’ international trade?

For more than forty years, the gravity equation has been a workhorse for cross-country empirical analyses of international trade flows and, in particular, the effects of free trade agreements (FTAs) on trade flows. However, the gravity equation is subject to the same econometric critique as earlier cross-industry studies of U.S. tariff and nontariff barriers and U.S. multilateral imports: Trade policy is not an exogenous variable. The authors address econometrically the endogeneity of FTAs using instrumental-variable (IV) techniques, control-function (CF) techniques, and panel-data techniques; IV and CF approaches do not adjust for endogeneity well, but a panel-data approach does. Accounting econometrically for the FTA variable’s endogeneity yields striking empirical results: The effect of FTAs on trade flows is quintupled.

2007 U.S CORN PRODUCTION RISKS: WHAT DOES HISTORY TEACH US?

Financial Economics, Production Economics, Risk and Uncertainty,

Understanding USDA Corn and Soybean Production Forecasts: An Overview of Methods, Performance and Market Impacts

Agricultural Finance,

Understanding USDA Corn and Soybean Production Forecasts: Methods, Performance and Market Impacts over 1970 - 2005

The purpose of this report is to improve understanding of USDA crop forecasting methods, performance and market impact. A review of USDA’s forecasting procedures and methodology confirmed the objectivity and consistency of the forecasting process over time. Month-to-month changes in corn and soybean production forecasts from 1970 through 2005 indicated little difference in magnitude and direction of monthly changes over time. USDA production forecast errors were largest in August and smaller in subsequent forecasts. There appeared to be no trend in the size or direction of forecast errors over time. On average, USDA corn production forecasts were more accurate than private market forecasts over 1970-2005, with the exception of August forecasts since the mid-1980s. The forecasting comparisons for soybeans were somewhat sensitive to the measure of forecast accuracy considered. One measure showed that private market forecasts were more accurate than USDA forecasts for August regardless of the time period considered. Another measure showed just the opposite. As the growing season progresses the difference in the results across the two measures of forecast accuracy diminished, with USDA forecast errors in soybeans about equal to or smaller than private market errors. USDA corn production forecasts had the largest impact on corn futures prices in August and recent price reactions have been somewhat larger than historical reactions. Similar to corn, USDA soybean production forecasts had the largest impact on soybean futures prices in August with recent price reactions appearing somewhat larger than in the past. Overall, the analysis suggests that over the long-run the USDA performs reasonably well in generating crop production forecasts for corn and soybeans.Agricultural Finance,

Martian sample sites: Examples based on a global geologic perspective

Ten areas were selected that each include several rock units of varying lithology and age. These areas were chosen to optimize the geologic and chronologic data return from Mars. Geologic mapping and stratigraphic studies identify stratigraphic ages, rock types, and information on Martian geologic history that samples of a given site may yield. Volcanic rocks occur over much of the planet and in virtually all stratigraphic positions, and they are amenable to radioisotopic dating. Therefore, a reasonable and essential goal for a sample return mission is to return datable rocks from widely varying strata. Generally, about three or four major geologic units can be sampled at any of the given sites, most of which can probably be dated. The Mars Observer mission will aid greatly in interpreting lithology and defining contacts at the high resolution required to actually pinpoint good sample acquisition sites within these areas

Market Instability in a New Era of Corn, Soybean, and Wheat Prices

grain, price, increase, trend, Demand and Price Analysis, Marketing, Q11, Q13,

Eruptive history of the Elysium Volcanic Province of Mars

New geologic mapping of the Elysium volcanic province at 1:2,000,000 scale and crater counts provide a basis for describing its overall eruptive history. Four stages are listed and described in order of their relative age. They are also distinguished by eruption style and location. Stage 1: Central volcanism at Hecates and Albor Tholi. Stage 2: Shield and complex volcanism at Elysium Mons and Elysium Fossae. Stage 3: Rille volcanism at Elysium Fossae and Utopia Planitia. Stage 4: Flood lava and pyroclastic eruptions at Hecates Tholus and Elysium Mons. Tectonic and channeling activity in the Elysium region is intimately associated with volcanism. Recent work indicates that isostatic uplift of Tharsis, loading by Elysium Mons, and flexural uplift of the Elysium rise produced the stresses responsible for the fracturing and wrinkle-ridge formation in the region. Coeval faulting and channel formation almost certainly occurred in the pertinent areas in Stages 2 to 4. Older faults east of the lava flows and channels on Hecates Tholus may be coeval with Stage 1