839 research outputs found
Gravity or Dummies? The Limits of Identification in Gravity Estimations
Trade economists often estimate gravity equations of international trade with fixed effects. Anderson and van Wincoop (2003, American Economic Review 93, 170â192) have shown the importance of controlling for multilateral trade resistances when estimating a gravity equation. This can be done by including exporter-time and importer-time fixed effects in a panel or exporter and importer fixed effects in a cross section estimation. I argue that this approach limits the identifiability of policy parameters that capture the effect of certain âclub membershipsâ (EU, NAFTA, euro area, WTO, etc.) on trade flows. I show that, in the baseline case, only one effect can be identified, which precludes, for example, the estimation of separate effects on the exporter and the importer side. The magnitude, and even the sign, of the estimated club effect are very sensitive to the precise identification assumptions, which are often left unspecified in empirical studies. The underlying problem is that club membership provides some, but very little bilateral variation. When heterogeneous club effects are to be identified, the membership dummies can become perfectly collinear with the fixed effects. Empirical researchers may not be aware of the lack of identification, because standard estimation techniques often permit them to run perfectly collinear regressions. I illustrate the findings with estimating the effect of EU enlargement in 2004 on the trade flows of new and old members. Finally, I discuss potential solutions.
Lumpy Trade and the Welfare Effects of Administrative Barriers
Using detailed U.S. and Spanish export data, we document that administrative trade costs of per shipment nature (documentation, customs clearance and inspection) lead to less frequent and larger-sized shipments, i.e. more lumpiness, in international trade. We build a model to analyze these effects and their welfare consequences. Exporters decide not only how much to sell at a given price, but also how to break up total trade into individual shipments. Consumers value frequent shipments, because they enable them to consume close to their preferred dates. Having fewer shipments hence entails a welfare cost. Calibrating the model to observed shipping frequencies and per-shipment costs, we show that countries would gain 2--3 percent of their GDP by eliminating such barriers. This suggests that trade volumes alone are insufficient to understand the gains from trade.
Forecasting Inflation - A Case Study on the Czech, Hungarian, Polish, Slovakian and Slovenian Central Banks
The paper examines the inflation forecasting practice and the related institutional framework at the central banks of five Central European countries (the Czech Republic, Hungary, Poland, Slovakia and Slovenia). The first part of the paper presents the general aspects of the comparative analysis, which primarily follow the requirements of inflation targeting monetary regimes. The second part consists of individual country case studies, which give detailed description of the institutional framework and forecasting practice at the five central banks considered.
Adjustment of global imbalances: Illustrative scenarios for Hungary
In this study we examine the impact on Hungary of a possible correction of global imbalances. We distinguished four different channels of the global adjustment process, which are widely referred to in the literature (fiscal tightening in the U.S.; housing price correction in the US; an increase in the risk premium of dollar assets; increase in domestic demand in the Asian region) and analyzed them through model simulations. We constructed global scenarios using the NIGEM model, while we captured the domestic impacts using the Quarterly Projection Model (NEM) of the Magyar Nemzeti Bank. According to our results, both the global and domestic effects differ significantly with respect to whether the correction originates from the U.S. or Asia and whether it is a result of policy or market processes. We found that a possible global correction will pass through to Hungary mainly through the Eurozone countries, thus its main impact will be relatively dampened. The responses of domestic macroeconomic variables depend on our assumptions on the reaction of monetary policy and the developments in the risk premium on forint denominated assets.monetary policy, global inbalalnces, forecasting, simulation.
The Effect of Auditorsâ Informal Communication in the Audit Environment on Financial Reporting Outcomes
I examine the effect of auditorsâ recurring, informal communication with managers and other auditors on financial reporting outcomes in a laboratory experiment in which participants in the roles of auditors and managers interact in a stylized audit setting. My 2Ă2 between-subjects design manipulates whether the auditors are able to informally communicate with either, neither, or both the manager and other auditors. I find that when the auditor and manager informally communicate, they each develop a social bond, which increases the managerâs feeling of accountability towards the auditor, causes the manager to make more honest representations to the auditor, and leads the auditor to assess the managerâs representations as more honest. Additionally, while the auditorâs informal communication with other auditors creates a social bond among auditors, this bond neither reduces the strength of the auditorâs bond with the manager nor reduces the effect of that bond on the auditorâs assessments of the honesty of the managerâs representations. My study highlights the importance of the social nature of auditing and its impact on financial reporting outcomes and has implications for practitioners and regulators
Magyar vĂĄllalatok haszonkulcsai
TanulmĂĄnyunkban bemutatjuk a vĂĄllalati haszonkulcsok becslĂ©sĂ©re alkalmazhatĂł mĂłdszereket, kiemelve a viszonylag kis adatigĂ©nyƱ Ă©s kevĂ©s feltevĂ©st alkalmazĂł De LoeckerâWarzynski [2012] mĂłdszertanĂĄt. E mĂłdszer segĂtsĂ©gĂ©vel vĂĄllalati haszonkulcsokat becsĂŒlĂŒnk a legalĂĄbb öt fĆt foglalkoztatĂł magyar feldolgozĂłipari vĂĄllalatok 2001 Ă©s 2012 közötti adatain, majd elemezzĂŒk a haszonkulcsok összefĂŒggĂ©sĂ©t a vĂĄllalati jellemzĆkkel. Megmutatjuk, hogy a nagyobb piaci rĂ©szesedĂ©sƱ, fiatal, alacsonyabb bĂ©reket fizetĆ Ă©s fejlett rĂ©giĂłban mƱködĆ vĂĄllalatok haszonkulcsai magasabbak, mint az azonos iparĂĄgban mƱködĆ tĂĄrsaikĂ©. KĂŒlön elemezzĂŒk a kĂŒlkereskedelem szerepĂ©t, rĂĄmutatva, hogy az importĂĄlĂĄs mĂ©g a termelĂ©kenysĂ©g figyelembevĂ©tele utĂĄn is nagyobb haszonkulccsal tĂĄrsul, mĂg az exportĂĄlĂłk magasabb haszonkulcsa inkĂĄbb a termelĂ©kenyebb vĂĄllalatok önszelekciĂłjĂĄbĂłl szĂĄrmazik.
Journal of Economic Literature (JEL) kĂłd: D22, D24, F14, L11, L60
Per-shipment costs and the lumpiness of international trade
Using detailed U.S. and Spanish export data, we document that trade costs of a per-shipment nature are associated with less frequent and larger shipments (i.e., more lumpiness) in international trade. This finding is pervasive across broad product categories, but most apparent for industrial supplies, parts and accessories, and food products. © 2015 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology
Administrative barriers to trade
We build a model of administrative barriers to trade to understand how they affect trade volumes, shipping decisions and welfare. Because administrative costs are incurred with every shipment, exporters have to decide how to break up total trade into individual shipments. Consumers value frequent shipments, because they enable them to consume close to their preferred dates. Hence per-shipment costs create a welfare loss.We derive a gravity equation in our model and show that administrative costs can be expressed as bilateral ad-valorem trade costs. We estimate the ad-valorem equivalent in Spanish shipment-level export data and find it to be large. A 50% reduction in per-shipment costs is equivalent to a 9 percentage point reduction in tariffs. Our model and estimates help explain why policy makers emphasize trade facilitation and why trade within customs unions is larger than trade within free trade areas. © 2015 The Authors
Markup and productivity of exporters and importers
This paper studies the relationship between firm markups and importing intermediate inputs and exporting using detailed firm-level data from Hungary in 1995-2003. We estimate production functions structurally to obtain firm-year-level productivity and markup estimates. We find that importing intermediate inputs is associated with large markup premium, while the exporter markup premium is nonexistent when we control for the importer status. We interpret our results in a simple theoretical framework, where firms lower their markup when exporting to more competitive foreign markets and where importing intermediate inputs leads to higher-quality products
Effect of synthesis conditions on the properties of magnetic nanoflowers
Magnetic nanoflowers (MNF) can be applied in complementary cancer therapy treatment, however, some of the preparation conditions and stability experiments have not been examined in great detail. In this study, magnetite nanoparticles (NPs) with flower-like architecture were synthesized, characterized and tested by magnetic hyperthermia. The preparation and characterization of flower-shaped magnetic objects were optimized in two types of reaction vessels. The two different synthesis methods resulted in magnetic nanoparticles (MNP) of slightly different morphology, resulting in different behavior for hyperthermia. The stability of the NPs was achieved by the application polymer functionalization both by in situ and postcoating methods
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