The Experts below are selected from a list of 324 Experts worldwide ranked by ideXlab platform
William D. Craighead - One of the best experts on this subject based on the ideXlab platform.
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Intermediate Goods and Exchange Rate Disconnect
Open Economies Review, 2019Co-Authors: William D. CraigheadAbstract:Abstract This paper introduces Intermediate Goods trade into a two-country real business cycle model and examines its implications for real exchange rate behavior. Intermediate Goods trade is shown to reduce “exchange rate disconnect” by increasing the volatility of the real exchange rate relative to output and weakening the link between the real exchange rate and output. Intermediate Goods trade also reduces the volatility of the terms of trade relative to the real exchange rate while increasing international output correlations and reducing the correlation between the trade balance and output.
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Intermediate Goods and Exchange Rate Disconnect
2017Co-Authors: William D. CraigheadAbstract:This paper introduces Intermediate Goods trade into a two-country real business cycle model and examines its implications for real exchange rate behavior. Intermediate Goods trade is shown to reduce “exchange rate disconnect” by increasing the volatility of the real exchange rate relative to output and weakening the link between the real exchange rate and output. Intermediate Goods trade also raises international output correlations and reduces the correlation between the trade balance and output.
Yoshinori Shiozawa - One of the best experts on this subject based on the ideXlab platform.
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A New Construction of Ricardian Trade Theory—A Many-country, Many-commodity Case with Intermediate Goods and Choice of Production Techniques—
Evolutionary and Institutional Economics Review, 2007Co-Authors: Yoshinori ShiozawaAbstract:Ricardian trade theory is one of the most famous theories of economics but appears to have been little developed. Many attempts were made to extend the theory to multi-country, multi-commodity cases, but none succeeded to construct a general theory that included Intermediate Goods. A need to include Intermediate Goods within the theory was evident, but hurdles to introduce Intermediate inputs were high. Intermediate Goods change the entire structure of analysis; when they are traded, the price of a good is dependent of the prices of imported inputs. Consequently, prices should be determined simultaneously for prices of all countries. The present paper has succeeded in overcoming these difficulties and describes how wages, prices and productions are related. It analyzes the M -country, N -commodity case with choice of techniques and trade of Intermediate Goods in general terms, thus presenting a new basis for international trade theory. New light was shed on topics like gains and losses from trade, international wage rate discrepancies, and price and quantity adjustments. On a theoretical plane, the new construction eliminates a traditional weakness of the Ricardian theory. The traditional Ricardian theory acknowledged labor as the only input and excluded capital in any form. The new theory, presented here, analyzes capital Goods as traded Intermediate inputs.
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a new construction of ricardian trade theory a many country many commodity case with Intermediate Goods and choice of production techniques
Evolutionary and Institutional Economics Review, 2007Co-Authors: Yoshinori ShiozawaAbstract:Ricardian trade theory is one of the most famous theories of economics but appears to have been little developed. Many attempts were made to extend the theory to multi-country, multi-commodity cases, but none succeeded to construct a general theory that included Intermediate Goods. A need to include Intermediate Goods within the theory was evident, but hurdles to introduce Intermediate inputs were high. Intermediate Goods change the entire structure of analysis; when they are traded, the price of a good is dependent of the prices of imported inputs. Consequently, prices should be determined simultaneously for prices of all countries. The present paper has succeeded in overcoming these difficulties and describes how wages, prices and productions are related. It analyzes the M-country, N-commodity case with choice of techniques and trade of Intermediate Goods in general terms, thus presenting a new basis for international trade theory. New light was shed on topics like gains and losses from trade, international wage rate discrepancies, and price and quantity adjustments. On a theoretical plane, the new construction eliminates a traditional weakness of the Ricardian theory. The traditional Ricardian theory acknowledged labor as the only input and excluded capital in any form. The new theory, presented here, analyzes capital Goods as traded Intermediate inputs.
Kemal Turkcan - One of the best experts on this subject based on the ideXlab platform.
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outward foreign direct investment and Intermediate Goods exports evidence from the usa
Economie Internationale, 2007Co-Authors: Kemal TurkcanAbstract:This study examines the relationship between outward FDI stocks and final and Intermediate Goods exports in the US economy over the period from 1989 to 2003. Using finely disaggregated trade data, the panel data estimation indicates that the outward FDI stock and Intermediate Goods exports are complementary activities, verifying the hypothesis that fragmentation plays an important role in explaining intra-firm trade between different plants within the same multinational companies. In contrast, the results find a weak evidence of substitution effects between final Goods exports and outward FDI stocks, providing partial support for the horizontal type FDI models.
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exchange rate pass through elasticities in final and Intermediate Goods the case of turkey
Yönetim ve Ekonomi: Celal Bayar Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 2005Co-Authors: Kemal TurkcanAbstract:A distinctive feature of present globalization is fragmentation of production. The recent developments in transportation and communication technologies led to a surge in Intermediate Goods trade. However, Intermediate Goods trade is often neglected in the empirical studies of the exchange rate pass-through. Using import unit values, this study examines the pass-through of exchange rate changes into both aggregated and disaggregated imported final and Intermediate Goods prices of Turkey for the period of 1989.q1 to 1996.q4. Empirically, Turkey's pass-through is quite rapid. The short-run and long-run elasticities for both final and Intermediate Goods suggest that complete pass-through is more relevant for Turkey at both aggregated and disaggregated level. In addition, the estimated pass-through elasticities considerably vary across countries and industries. Finally, Intermediate Goods have relatively higher pass -through rates than final Goods.
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determinants of intra industry trade in final Goods and Intermediate Goods between turkey and selected oecd countries
Istanbul University Econometrics and Statistics e-Journal, 2005Co-Authors: Kemal TurkcanAbstract:The increased importance of fragmentation in world trade has created an interest among trade economists to explain the determinants of trade in Intermediate Goods. A significant portion of trade in Intermediates between Turkey and OECD countries takes the form of intra-industry (IIT). Country-specific and industry-specific hypotheses drawn from the IIT literature are put forward to investigate the IIT in final and Intermediates between Turkey and other selected OECD countries for the period of 1985-2000. To test these hypotheses, we have utilized three-way fixed effects and random effects models. The results indicate that the determinants of IIT for final Goods are not much different from those for Intermediate Goods. Finally, the results suggest that country-specific rather than industry-specific variables are the central determinants of IIT in final and Intermediate Goods between Turkey and OECD.
Charles I Jones - One of the best experts on this subject based on the ideXlab platform.
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Intermediate Goods and weak links in the theory of economic development
American Economic Journal: Macroeconomics, 2011Co-Authors: Charles I JonesAbstract:What explains the enormous differences in incomes across countries? This paper returns to two old ideas: linkages and complementarity. First, linkages between firms through Intermediate Goods deliver a multiplier similar to the one associated with capital in a neoclassical growth model. Because the Intermediate Goods share of output is about one-half, this multiplier is substantial. Second, just as a chain is only as strong as its weakest link, problems along a production chain can sharply reduce output under complementarity. These forces considerably amplify distortions to the allocation of resources, bringing us closer to understanding large income differences across countries.(JEL: D57, E23, O1O, O47)
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Intermediate Goods weak links and superstars a theory of economic development
National Bureau of Economic Research, 2008Co-Authors: Charles I JonesAbstract:Per capita income in the richest countries of the world exceeds that in the poorest countries by more than a factor of 50. What explains these enormous differences? This paper returns to several old ideas in development economics and proposes that linkages, complementarity, and superstar effects are at the heart of the explanation. First, linkages between firms through Intermediate Goods deliver a multiplier similar to the one associated with capital accumulation in a neoclassical growth model. Because the Intermediate Goods' share of revenue is about 1/2, this multiplier is substantial. Second, just as a chain is only as strong as its weakest link, problems at any point in a production chain can reduce output substantially if inputs enter production in a complementary fashion. Finally, the high elasticity of substitution associated with final consumption delivers a superstar effect: GDP depends disproportionately on the highest levels of productivity in the economy. This paper builds a model with links across sectors, complementary inputs, and highly substitutable consumption, and shows that it can easily generate 50-fold aggregate income differences.
Kazunobu Hayakawa - One of the best experts on this subject based on the ideXlab platform.
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Chapter 1 Market Access and Intermediate Goods Trade
2020Co-Authors: Kazunobu HayakawaAbstract:This paper examines a distinctive feature of Intermediate Goods trade which the traditional gravity equation fails to capture, i.e., Intermediate Goods trade is positively related not only to the importing country‟s demand for finished Goods but also to its neighbors‟ demand for finished Goods. We regress a gravity equation for finished Goods trade in the first step. Then, introducing the importing country‟s access to the total demand for finished Goods which is calculated by using the estimates in the first step, we regress our gravity equation for trade in Intermediate Goods. Our regression results confirm such a feature of Intermediate Goods trade. Using the results of the regression, we simulate how the rise of US consumers‟ demand for finished Goods affects the total imports and exports of Intermediate Goods in each country.
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bilateral tariff rates in international trade finished Goods versus Intermediate Goods
International Economics and Economic Policy, 2014Co-Authors: Kazunobu HayakawaAbstract:In this paper, we examined back-and-forth international transactions through tariff reduction by estimating modified gravity equations for finished Goods and Intermediate Goods separately. Our main findings are as follows. Exports of finished machinery products are negatively associated with not only the importer’s tariff rates on finished machinery products but also the exporter’s tariff rates on machinery parts. Similarly, exports of machinery parts are negatively associated with not only the importer’s tariff rates on machinery parts but also the exporter’s tariff rates on finished machinery products. These results imply that tariff reduction in only one production process in an industry has the potential to drastically change the magnitude of trade in the whole industry.
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market access and Intermediate Goods trade
2009Co-Authors: Kazunobu HayakawaAbstract:The role of importer access to the finished Goods market in Intermediate Goods trade is examinedby estimating the gravity-like equation derived from the NEG model. Importer access to demandfor finished Goods is calculated by using the estimates in the gravity equation for finished Goodstrade, and then Intermediate Goods trade is regressed on the importer access. Results indicate thatimports of Intermediate Goods are sensitive not only to the magnitude of importer demand forfinished Goods but also to the demand of neighboring countries. Using results of the regression,the impact of US finished Goods market expansion on Intermediate Goods trade in each country issimulated.
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growth of Intermediate Goods trade in east asia
Pacific Economic Review, 2007Co-Authors: Kazunobu HayakawaAbstract:This paper examines what contributes to the trade growth of Intermediate machinery Goods in East Asia in the 1990s. To this end, this paper regresses the input allocation equation to obtain the estimator of border barriers in each country, and then, by using the estimators, the first difference logarithmic form of the gravity equation is regressed. Our empirical results suggest that reduction in border barriers and the production and expenditure growth of Intermediate Goods are important factors which contribute to the rapid growth of trade in machinery parts in East Asia.
