Marc Auboin, Floriana Borino, 26 June 2017

In recent years there has been debate over whether the global trade slowdown and related fall in trade-to-income elasticity was structural or cyclical. This column estimates the standard import equation for 38 advanced and developing economies using an import intensity-adjusted measure of aggregate demand. This measure allows the authors to predict 90% of changes in global imports. The slowdown in global value chains explains more than half of the remaining share of the global trade slowdown, while protectionism does not appear to be statistically significant.

Simon Evenett, Johannes Fritz, 13 July 2016

For the past 18 months, officials have worried about a global trade slowdown. This column summarises the latest Global Trade Alert report, which shows that, in fact, global trade is not growing slower – it is not growing at all. The plateau in global trade coincided with a spike in protectionism.

Cristina Constantinescu, Aaditya Mattoo, Michele Ruta, 25 May 2016

Trade has been growing more slowly since the Great Recession not only because global GDP growth is lower, but also because trade itself has become less responsive to GDP. The causes of the changing trade-income relationship have been studied, but its consequences have not. This column presents a simple framework to assess some of the demand-side and supply-side implications. The change hurts growth, although the quantifiable effects are not large.  

Cristina Constantinescu, Aaditya Mattoo, Michele Ruta, 18 January 2015

Not only is world trade lower than its pre-Crisis level, but it is also growing slower than GDP. This column examines the relationship between trade and GDP in the last four decades. The findings indicate that roughly half of the slowdown is driven by structural rather than cyclical factors. Trade itself has become less responsive to GDP in recent years. In particular, supply chains are maturing after years of rapid expansion.

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