Jean Imbs, 10 November 2010

What makes the global crisis global? This column argues that the interdependence of the global economy, brought about by financial linkages between developed countries as well as goods trade ties with developing countries, has made the global crisis the first global recession in decades.

Michael Moore, Thomas Prusa, 08 November 2010

Last month the US Department of Commerce announced a series of proposals to strengthen the enforcement of US trade laws. This column argues that these proposals will directly undercut President Obama’s trade commitments announced in his 2010 State of the Union Address – reducing access to critical inputs for US firms and increasing the chances that they face the same treatment abroad. It begs US policymakers to reconsider.

Volker Nitsch, Helge Berger, 02 November 2010

What can policymakers do to redress the global imbalances? This column presents evidence from 18 European countries over the past 60 years. It finds that while permanently fixed nominal exchange rates often result in large and lasting trade imbalances, these imbalances usually reflect a difference in trade competitiveness that can be addressed through structural and macroeconomic policies.

Francesco D'Amuri, Giovanni Peri, 31 October 2010

Several studies find that immigrants do not harm the wages and job prospects of native workers. This column seeks to explain these somewhat counterintuitive findings by emphasizing the scope for complementarities between foreign-born and native workers. Examining 14 European countries from 1996 to 2007, it finds that immigrants often supply manual skills, leaving native workers to take up jobs that require more complex skills – even boosting demand for them. Immigrants replace “tasks”, not workers.

Yiping Huang, 19 October 2010

The ongoing global imbalances has strengthened calls for the US to declare trade war with China. This column argues that the US did not emerge victorious from the last currency war with Japan, and against China the chances are even slimmer. Instead the upcoming G20 meeting should focus on a broad range of structural adjustments from both sides.

Jens Arnold, Beata Javorcik, Molly Lipscomb, Aaditya Mattoo, 12 October 2010

Conventional explanations for the post-1991 growth of India’s manufacturing sector focus on trade liberalisation and industrial de-licensing. This column examines 4,000 Indian firms from 1993 to 2005 and argues that a key factor for the success of Indian manufacturing may lie outside of manufacturing – in the services sector.

Chunding Li, John Whalley, Yan Chen, 08 October 2010

As the debate over global imbalances develops, this column asks whether the discussion is based on faulty data. Using data from the US, Japan, Germany, and the Czech Republic, it argues that not taking due account of foreign affiliate sales leads to a warped view of trade in goods and services.

Karen-Helene Ulltveit-Moe, Andreas Moxnes, 01 October 2010

The great trade collapse during the global crisis has opened a new chapter in trade debate. This column uses evidence from a real-exchange-rate shock in Norway to show how firms initially slowed down or postponed the introduction of new products to the market. It argues that this sort of response suggests a long and difficult recovery from the global trade collapse – unless policymakers intervene.

Daniel Gros, 08 October 2010

With the US threatening to label China a “currency manipulator”, this column presents a plan to address global imbalances without risking a trade war. It proposes a “reciprocity” requirement – if the US can’t buy Chinese government bonds, then China can’t buy US bonds either.

Raphael Auer, 19 September 2010

Do differences in tastes impede gains from trade? This column says that that may be the case only in special circumstances. In fact, the effects of trade liberalization may be entirely unaffected by the distribution of foreign tastes and coincide with those of a representative agent approach.

Simon Evenett, 16 September 2010

Our understanding of the recent recovery in world trade would be incomplete without a consideration of the export inducements put in place during the past 12 to 18 months by major trading nations. This column summarises the findings of the seventh report of the Global Trade Alert, including a regional focus on Latin America.

Takatoshi Ito, Satoshi Koibuchi, Kiyotaka Sato, Junko Shimizu, 08 September 2010

Why do so many Japanese firms risk their profits by invoicing their exporters in foreign currencies? This column, based on firm-level interview data, suggests that such invoicing may be motivated by the fact that many Japanese firms export their goods to foreign subsidiaries facing local competitors. Invoicing in foreign currencies concentrates currency risk at the company headquarters.

Mona Haddad , Ann Harrison, Catherine Hausman, 27 August 2010

The great trade collapse that accompanied the global crisis was historically severe. This column presents evidence from several countries suggesting that the great trade collapse was more concentrated along the intensive margin – the reduction in the value of goods already being traded – providing hope that trade may recover sooner than feared.

Ernesto Aguayo-Téllez, Jim Airola, Chinhui Juhn, 24 August 2010

Promoting gender equality is a Millennium Development Goal. This column explores the effects of trade liberalisation in Mexico during the 1990s on the country’s gender gap. It finds that trade benefitted sectors of the economy that employ more women, such as textiles and clothing, thereby helping to raise women’s earnings and relative social status.

Johannes Van Biesebroeck, Timothy Sturgeon, 10 August 2010

Could the car industry in developing countries start to produce vehicles that can compete domestically – perhaps even globally? This column argues that while the prospects for the automotive sector are still less promising than for other industries, as the markets for motor vehicles shift to the developing world and production inevitably follows, more development and design work will shift as well.

Michael Ferrantino, Danielle Trachtenberg, Alison Weingarden, 05 August 2010

Can increasing US exports create US jobs? Manufactures dominate US exports, but US manufacturing employment is declining. This column suggests that increased US exports are unlikely to lead to dramatic manufacturing employment gains, but employment in related services sectors may improve.

Luiz de Mello, Pier Carlo Padoan, 01 August 2010

Global imbalances are firmly back on the policy agenda. This column examines evidence from past imbalances that suggests that the current-account reversals can be sizeable and the resulting disruption to capital flows could pose risks for the global recovery.

Barry Eichengreen, Peter Temin, 30 July 2010

The world economy is experiencing tensions arising from inflexible exchange rates – particularly the dollar-renminbi peg and the Eurozone. Drawing on lessons from the gold standard, this column points out that an international monetary system is a system – nations’ policies have spillovers. Now, as in the 1930s, surplus nations’ refusals to increase spending force deficit countries to contract. Keynes drew this lesson from the Great Depression, which is why he wanted measures to deal with chronic surplus countries. Sixty-plus years later, we seem to have forgotten his point.

Ataman Aksoy, Francis Ng, 30 July 2010

This column sketches the changing face of global agricultural trade over the last 20 years. It finds that developing countries have not been able to increase their export shares in agriculture in line with their manufacture shares. What little increase there has been is largely the result of expanding exports to other developing countries.

Luis Servén, Ha Nguyen, 29 July 2010

Global imbalances have taken centre stage in the debate on the global economic outlook. This column surveys the debate over the roots of global imbalances and argues that asymmetries in the supply and demand for assets, rather than goods, are responsible. With this interpretation, global imbalances are unlikely to go away any time soon.

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