Export performance and trade facilitation reform : hard and soft infrastructure

The authors estimate the impact of aggregate indicators of"soft"and"hard"infrastructure on the export performance of developing countries. They build four new indicators for 101 countries over the period 2004-07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment. Moreover, the findings provide evidence that the marginal effect of infrastructure improvement on exports appears to be decreasing in per capita income. In contrast, the impact of information and communications technology on exports appears increasingly important for richer countries. Drawing on estimates, the authors compute illustrative exports growth for developing countries and ad-valorem equivalents of improving each indicator halfway to the level of the top performer in the region. As an example, improving the quality of physical infrastructure so that Egypt's indicator increases half-way to the level of Tunisia would increase exports by 10.8 percent. This is equivalent to a 7.4 percent cut in tariffs faced by Egyptian exporters across importing markets.Environmental Economics&Policies,Transport Economics Policy&Planning,Free Trade,Economic Theory&Research,Trade Policy

Why trade facilitation matters to Africa ?

This paper reviews data and research on trade costs for Sub-Saharan African countries. It focuses on: border-related costs, transport costs, costs related to behind-the border issues, and the costs of compliance with rules of origin specific to preferential trade agreements. Trade costs are, on average, higher for African countries than for other developing countries. Using gravity-model estimates, the authors compute ad-valorem equivalents of improvements in trade indicators for a sample of African countries. The evidence suggests that the gains for African exporters from improving the trade logistics half-way to the level in South Africa is more important than a substantive cut in tariff barriers. As an example, improving logistics in Ethiopia half-way to the level in South Africa would be roughly equivalent to a 7.5 percent cut in tariffs faced by Ethiopian exporters.Transport Economics Policy&Planning,Free Trade,Economic Theory&Research,Environmental Economics&Policies,Trade Policy

Testing Nonlinearities Between Brazilian Exchange Rate and Inflation Volatilities

There are few studies directly addressing exchange rate and inflation volatilities, and lack of consensus among them. However, this kind of study is necessary, especially because they can help monetary authorities to know price behavior better. This article analyses the relation between exchange rate and inflation volatilities using a bivariate GARCH model, and therefore modeling conditional volatilities, fact largely unexplored by the literature. We find a semi-concave relation between those series, and this nonlinearity may explain their apparently disconnection under a floating exchange rate system. The article also shows that traditional tests, with non-conditional volatilities, are not robust.

EQUILIBRIUM MODELS OF TRADE EQUATIONS: A CRITICAL REVIEW

In this paper we review the theoretical literature on trade equation models, including the production theory approach. We discuss several empirical problems commonly found in the applied work and the available literature on Brazilian trade equations.Neste artigo, revisa-se a literatura teórica sobre equações de comércio exterior, inclusive o modelo de comércio baseado na teoria da produção. Discute-se vários problemas comumente encontrados em trabalhos empíricos e também a literatura existente sobre equações relativas ao comércio exterior brasileiro

Increasing the Legal Retirement Age: The Impact on Wages, Worker Flows and Firm Performance

Many pay-as-you-go pension systems have increased or plan to increase their legal retirement age (LRA) to address the financial consequences of ageing. Although the success of these policies is ultimately determined at the labour market, little is known about the effects of higher LRAs at the firm level. Here, we identify this effect by considering a legislative reform introduced in Portugal in 1994: women's LRA was gradually increased from 62 to 65 years while men's LRA stayed unchanged at 65. Using detailed matched employer-employee panel data and difference-in-differences matching methods, we analyse the effects of the reform in terms of a number of worker- and firm-level outcomes. After providing evidence of compliance with the law, we find that the wages and hours worked of older women (those required to work longer) were virtually unchanged. However, firms employing older female workers significantly reduced their hirings, especially of younger female workers. Those firms also lowered their output although not their output per worker.social security reform, older workers, matching estimators

Beyond the information technology agreement : harmonization of standards and trade in electronics

Product standards can have a dual impact on production and trade costs. Standards may impose additional costs on exporters as it may be necessary to adapt products for specific markets (cost-effect). In contrast, standards can reduce exporters'information costs if they convey information on industrial requirements or consumer tastes that would be costly to collect in the absence of standards (informational-effect). Using a new World Bank database of European standards for electronic products, the authors examine the impact of internationally-harmonized European standards on European Union imports. They find that European Union standards for electronic products that are harmonized to international standards have a positive and significant effect on trade. The results suggest that efforts to promote trade in electronic products could be complemented by steps to promote standards harmonization. This might include, for example, re-starting talks to extend the Information Technology Agreement to non-tariff measures and commitments to harmonize national standards in electronic products.Information Security&Privacy,Technology Industry,Scientific Research&Science Parks,Science Education,Labor Policies