The Experts below are selected from a list of 264 Experts worldwide ranked by ideXlab platform
Alessandro Maravalle - One of the best experts on this subject based on the ideXlab platform.
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Oil shocks and the US terms of Trade: gauging the role of the Trade Channel
Applied Economics Letters, 2013Co-Authors: Alessandro MaravalleAbstract:Recent theoretical literature claims that demand-driven transmission mechanisms are the key to understand how oil shocks affect the economy. Following this literature, we measure the economic strength of one of these demand-driven Channels, the Trade Channel, in the transmission of oil shocks to the US economy. We use Kilian's (2009) decomposition of oil price shocks to identify three possible sources of oil shocks: oil supply, oil-market specific demand and global demand shocks. We then estimate the impact of each shock on the US terms of Trade controlling for nonlinear effects in the sign and the size of the shocks. All oil shocks have persistent and statistically significant effects on the US terms of Trade. However, we find that only oil supply shocks have an impact on the terms of Trade that is nonlinear in the size of the shock. This last result is in accordance with the theoretical findings in Maravalle (forthcoming).
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The role of the Trade Channel in the propagation of oil supply shocks
Energy Economics, 2012Co-Authors: Alessandro MaravalleAbstract:Abstract This paper analyzes when and why idiosyncratic oil supply shocks produce large macroeconomic effects in an analytically tractable two-country general equilibrium model. We focus on a demand-driven mechanism, the Trade Channel, which transmits oil shocks across economies through changes in the non-oil goods terms of Trade. When the Trade Channel is operative we have three main consequences on the transmission of oil shocks. First, the macroeconomic impact of oil shocks may be large and asymmetric across countries. Second, the magnitude of the effects is nonlinear in the size of the oil shock. Third, terms of Trade movements never ensure international risk sharing after an idiosyncratic oil supply shock.
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The role of the terms of Trade in the Trade Channel of propagation of oil price shocks
2010Co-Authors: Alessandro MaravalleAbstract:This paper highlights the role of the terms of Trade in the Trade Channel of propagation of oil price shocks both empirically and theoretically. Empirically, I show that oil price shocks have a large, persistent and statistically significant impact on the US terms of Trade. Theoretically, I add oil in the model by Corsetti and Pesenti (2005) and analyse under what conditions the terms of Trade plays a relevant role in the international transmission of oil price shocks. With nominal price rigidities and full exchange rate pass-through positive oil price shocks depreciate the currency of the oil importing country. The subsequent negative wealth effect adds to the recessive effect of the supply Channel and may strongly reduce the consumption in the oil importing country economy. Without exchange rate pass-through oil shocks transmit to the economy only through the supply Channel. The model suggests that a change in the exchange rate pass-through might contribute to explain the evidence of a weaker impact of oil price shocks on the macroeconomic activity in recent times.
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The role of the terms of Trade in the Trade Channel of transmission of oil price shocks
2010Co-Authors: Alessandro MaravalleAbstract:This paper highlights the role of the terms of Trade in the Trade Channel of propagation of oil price shocks both empirically and theoretically. Empirically, I show that oil price shocks have a large, persistent and statistically significant impact on the US terms of Trade. Theoretically, I add oil in the model by Corsetti and Pesenti (2005) and analyse under what conditions the terms of Trade plays a relevant role in the international transmission of oil price shocks. With nominal price rigidities and full exchange rate pass-through positive oil price shocks depreciate the currency of the oil importing country. The subsequent negative wealth effect adds to the recessive effect of the supply Channel and may trongly reduce the consumption in the oil importing country economy. Without exchange rate pass-through oil shocks transmit to the economy only through the supply Channel. The model suggests that a change in the exchange rate pass-through might contribute to explain the evidence of a weaker impact of oil price shocks on the macroeconomic activity in recent times.
Roel Beetsma - One of the best experts on this subject based on the ideXlab platform.
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What are the Trade Spill-Overs from Fiscal Shocks in Europe? An Empirical Analysis***
De Economist, 2005Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (Trade spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination.
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What are the spill-overs from fiscal shocks in Europe? An empirical analysis
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination. JEL Classification: E62, E63, F42
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What are the Spill-overs from Fiscal Shocks in Europe? An Empirical Analysis
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination.
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and
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. We also conduct a panel data analysis linking bilateral exports to fiscal variables. Here, the effects of fiscal policies are consistent with those for the VAR analysis. Overall, our findings suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination
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What are the Trade Spill-Overs from Fiscal Shocks in Europe? An Empirical Analysis***
1Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (Trade spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination. Copyright Springer 2005fiscal shocks, fiscal policy, monetary policy, spill-overs, impulse responses, E62, E63, F42,
Josep M. Vilarrubia - One of the best experts on this subject based on the ideXlab platform.
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International recycling of petrodollars
2006Co-Authors: Juan M. Ruiz, Josep M. VilarrubiaAbstract:The continued rise in oil prices since 2002 has resulted in a significant increase in export revenue for oil exporting countries. This increase in the price of oil and other commodities means that OPEC countries and Russia have received, between 2003 and 2006, a windfall of 1.3 trillion dollars with respect to their export level in 2002. This paper analyzes, using the limited data available, the recycling of these resources back to the world economy through the Trade Channel, via higher imports, or the financial Channel, via an increase in the net external asset position of these countries. Our results show that around 50% of the windfall revenue has been used to increase imports, while the rest has been directed towards international reserve accumulation and other improvements in the net asset position of these countries. Comparing the current oil price increase with previous ones, such as those resulting from the tightening of oil supply in the 70’s, we find that the Trade Channel has been more important in the current episode than in previous ones. This can be attributed to (i) the perception of a more permanent increase in the price of oil in the context of rising demand, and (ii) the gradualism of the current oil price increase, which has allowed a stronger response from imports.
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Canales de reciclaje internacional de los petrodólares
2006Co-Authors: Juan M. Ruiz, Josep M. VilarrubiaAbstract:The continued rise in oil prices since 2002 has resulted in a significant increase in export revenue for oil exporting countries. This increase in the price of oil and other commodities means that OPEC countries and Russia have received, between 2003 and 2006, a windfall of 1.3 trillion dollars with respect to their export level in 2002. This paper analyzes, using the limited data available, the recycling of these resources back to the world economy through the Trade Channel, via higher imports, or the financial Channel, via an increase in the net external asset position of these countries. Our results show that around 50% of the windfall revenue has been used to increase imports, while the rest has been directed towards international reserve accumulation and other improvements in the net asset position of these countries. Comparing the current oil price increase with previous ones, such as those resulting from the tightening of oil supply in the 70’s, we find that the Trade Channel has been more important in the current episode than in previous ones. This can be attributed to (i) the perception of a more permanent increase in the price of oil in the context of rising demand, and (ii) the gradualism of the current oil price increase, which has allowed a stronger response from imports.
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INTERNATIONAL RECYCLING OF PETRODOLLARS
2006Co-Authors: Juan M. Ruiz, Josep Vilarubia, Josep M. Vilarrubia, Santiago Fernández De Lis, José Viñals, José María MarínAbstract:The continued rise in oil prices since 2002 has resulted in a significant increase in export revenue for oil exporting countries. This increase in the price of oil and other commodities means that OPEC countries and Russia have received, between 2003 and 2006, a windfall of 1.3 trillion dollars with respect to their export level in 2002. This paper analyzes, using the limited data available, the recycling of these resources back to the world economy through the Trade Channel, via higher imports, or the financial Channel, via an increase in the net external asset position of these countries. Our results show that around 50% of the windfall revenue has been used to increase imports, while the rest has been directed towards international reserve accumulation and other improvements in the net asset position of these countries. Comparing the current oil price increase with previous ones, such as those resulting from the tightening of oil supply in the 70’s, we find that the Trade Channel has been more important in the current episode than in previous ones. This can be attributed to (i) the perception of a more permanent increase in the price of oil in the context of rising demand, and (ii) the gradualism of the current oil price increase, which has allowed a stronger response from imports. JEL Codes: Q43, F14.
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International Recycling Channels of Petrodollars
SSRN Electronic Journal, 2006Co-Authors: Juan M. Ruiz, Josep M. VilarrubiaAbstract:The continued rise in oil prices since 2002 has resulted in a significant increase in export revenue for oil exporting countries. This increase in the price of oil and other commodities means that OPEC countries and Russia have received, between 2003 and 2006, a windfall of 1.3 trillion dollars with respect to their export level in 2002. This paper analyzes, using the limited data available, the recycling of these resources back to the world economy through the Trade Channel, via higher imports, or the financial Channel, via an increase in the net external asset position of these countries. Our results show that around 50% of the windfall revenue has been used to increase imports, while the rest has been directed towards international reserve accumulation and other improvements in the net asset position of these countries. Comparing the current oil price increase with previous ones, such as those resulting from the tightening of oil supply in the 70's, we find that the Trade Channel has been more important in the current episode than in previous ones. This can be attributed to (i) the perception of a more permanent increase in the price of oil in the context of rising demand, and (ii) the gradualism of the current oil price increase, which has allowed a stronger response from imports.
Amit K. Biswas - One of the best experts on this subject based on the ideXlab platform.
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Preferential Trade and mis-invoicing: Some analytical implications
International Review of Economics & Finance, 2007Co-Authors: Amit K. Biswas, Sugata MarjitAbstract:Abstract This paper examines how different Trade policies affect illegal Trade practices, foreign exchange market and the degree of illegal capital outflow. It builds up a three-country preferential–non-preferential Trade model where low or zero tariff prevails in the preferential Trade Channel and higher tariff is exercised in the non-preferential Trade Channel. We show that initially the preferential Trade Channel is likely to encourage illegal capital outflow and non-preferential Trade Channel is conducive for illegal transactions in foreign exchange in the local market. But finally a low tariff regime takes care of both illegal capital outflow and black market for foreign exchange.
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Preferential Trade, Mis-invoicing and Capital Flight
2002Co-Authors: Amit K. BiswasAbstract:The dependence of less developed countries (LDCs) on protectionary policies and exchange controls to manage their balance of payments (BoPs) and scarce capital reserves are widespread and phenomenal. Presence and persistence of regulatory control on Trade and payments induces exporters and importers to undertake illegal transactions. Such actions in turn lead to black market for scarce foreign exchange as well as capital flight. With this backdrop let us shift our focus to analyze a situation where an economy has experienced a certain amount of Trade reform through lowering of the tariff rate and a somewhat floated domestic currency. Zero or low tariff rate reduces the incentive for an importer to under-invoice and given a certain amount of BMP he may even go for over-invoicing. A minimal amount of under-voicing or even a positive amount of over-voicing by the importers is likely to reduce the demand component in the black-market for foreign exchange. The exporters on the other hand may still continue with their under-invoicing practices if they think that they would gain given a small magnitude of BMP and small punishment costs in the event of mis-reporting. Thus there may be continuing supplies of illegal foreign exchange with a reduced demand for it. With capital control still in place, which forbids the domestic investors from investing aboard which are more lucrative destination, huge amount of unauthorized foreign exchange may cross the border illegally. Usually capital flight is an illegal conversion of financial assets from the national currency to assets in a more stable currency in response to or in anticipation of heightened financial risk. The purpose of this paper is to examine how changes in Trade policy affects capital flight. This paper builds up a three-country preferential – non-preferential Trade model where, ceteris paribus, Trade Channels are demarcated in the sense that low or zero tariff prevails in the preferential Trade Channel while higher tariff is exercised in the non-preferential Trade cannel. Initially we would experience that the preferential Trade Channel is prone to capital flight and non-preferential Trade Channel is conducive for illegal transactions in foreign exchange in the local market. Given these initial outcomes, we would proceed to examine the behavior of the BMP through the changes in the demand and supply components in the illegal foreign exchange market. Finally we would further examine the process of occurrence of capital flight and the operation of parallel foreign exchange market in the changed circumstances where BMP is determined endogenously within the model. In this general equilibrium framework, we demonstrate that the initial surge in capital flight through preferential Trade Channel and increased transaction in illegal foreign exchange market through preferential Trade Channel would likely to be partly taken care of once we allow changes in the BMP through transaction in illegal foreign exchange market demand and supply components. We also apply the results of our theoretical model to Mexico’s preferential non-preferential Trade Channels to justify the validity of our model.
Massimo Giuliodori - One of the best experts on this subject based on the ideXlab platform.
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What are the Trade Spill-Overs from Fiscal Shocks in Europe? An Empirical Analysis***
De Economist, 2005Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (Trade spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination.
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What are the spill-overs from fiscal shocks in Europe? An empirical analysis
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination. JEL Classification: E62, E63, F42
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What are the Spill-overs from Fiscal Shocks in Europe? An Empirical Analysis
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination.
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and
2004Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. We also conduct a panel data analysis linking bilateral exports to fiscal variables. Here, the effects of fiscal policies are consistent with those for the VAR analysis. Overall, our findings suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination
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What are the Trade Spill-Overs from Fiscal Shocks in Europe? An Empirical Analysis***
1Co-Authors: Massimo Giuliodori, Roel BeetsmaAbstract:We use a Vector Auto Regression (VAR) analysis to explore the (Trade spill-over) effects of fiscal policy shocks in Europe. To enhance comparability with the existing literature, we first analyse the effects of these shocks at the national level. Here, we employ identification based on Choleski decomposition and a structural VAR, both of which lead to the same results. Then, we turn to study the cross-border spill-overs of fiscal shocks via the Trade Channel. Fiscal expansions in Germany, France and Italy lead to significant increases in imports from a number of European countries. In order to mimic the case of monetary union, we also shut off the effects via the short-term interest rate and the nominal exchange rate and find a slight strengthening on average of the cross-country spill-overs from a fiscal expansion. These results suggest that it may be worthwhile to further investigate the possibility of enhanced fiscal coordination. Copyright Springer 2005fiscal shocks, fiscal policy, monetary policy, spill-overs, impulse responses, E62, E63, F42,
