While the Heckscher-Ohlin-Vanek (HOV) theorem has been a dominant paradigm in trade theory, the empirical evidence to support it has been weak. This paper develops a modified HOV model that allows technologies to differ across countries. The revised model significantly improves the theory’s accuracy in predicting trade flows in contrast to the traditional model. The paper also illustrates that, since countries have different technologies, measures of factor contents of trade in final goods using direct and domestically produced indirect input requirements are more accurate and yield more consistent predictions than do traditional measures.
A review of the theoretical twists and turns in the development of the Heckscher-Ohlin model and an empirical assessment of the basic model and three related theorems. No names are more closely associated with modern trade theory than Eli Heckscher and Bertil Ohlin. The basic Heckscher-Ohlin proposition, according to which a country exports factors in abundant supply and imports factors in scarce supply, is a key component of modern trade theory. In this book, Robert Baldwin traces the development of the HO model, describing the historical twists and turns that have led to the basic modern theoretical model in use today. Baldwin not only presents a clear and cohesive view of the model's evolution but also reviews the results of empirical tests its various versions. Baldwin, who published his first theoretical article on the HO model in 1948, first surveys the development of the HO model and then assesses empirical tests of its predictions. Most discussions of empirical work on HO models confine themselves to the basic theorem, but Baldwin devotes a chapter to empirical tests of three related propositions: the Stolper-Samuelson theorem; the Rybczynski theorem; and the factor price equalization theorem. He concludes that the formulation and testing of these later models have improved economists' understanding of the forces shaping international trade, but that many empirical trade economists (himself included) were so enamored of the elegant but highly unrealistic factor price equalization models developed from the insights of Heckscher and Ohlin that they have neglected investigation of other models without this relationship.
In today's increasingly globalized environment, many economic fundamentals need to be reconsidered in order to regain stability in the global marketplace. One such consideration is the failing dynamics of the international tax infrastructure. Neoliberalism 2.0 brings a 21st century assessment of the Pigovian taxes, considering a completely new calibration of the international tax systems, inspired by the historically developed Pigovian tax model. The book considers the impact neoliberalism had and will have on regulatory infrastructure, democracy in an era of globalization and reduced legitimation of the national state. The Pigovian model brings home the often forgotten relationship between taxation (as a part of the regulatory sphere), macro-economics, and the political-philosophical context in which law and economics emerge. The model also takes into account the phenomena of globalization and financialization and is tested using the financial sector as an example. This book addresses the many challenges a Pigovian shift would imply for the sovereign and its national economies. Neoliberalism 2.0 demonstrates the ability to design a paradigm-changing alternative to the current tax infrastructure, while taking into account a low economic growth environment of the future, the implications of globalization and the changing relationship between citizens and their state.
During the last century international trade has become indispensable for many economies. This is not only the case for trade in primary raw materials and consumer products but also for secondary (recyclable) materials. With the rapid growth of the recycling sector worldwide, trade in recyclables increased tremendously. It is striking that most of this trade flows from developed to developing countries. This book addresses the main causes of this typical trade pattern and investigates its economic and environmental effects by carrying out case studies on waste paper imports in India, waste plastics imports in China, and used-tyre trade in Europe. The book concludes by recommending policies that are aimed at preventing negative economic and environmental effects potentially resulting from trade in recyclables. The book offers new ideas to researchers who are involved in international trade, material flows, and waste management, and provides new insights for decision-makers who are interested in WTO and the Basel Convention.
The greatest strength of this thoroughly revised and expanded edition of Lectures on International Trade is its rigorous algebraic and geometric treatment of the various models and results of trade theory. The authors, who now include Arvind Panagariya, offer both policy insights and empirical applications. They have added nine entirely new chapters as well as new sections to several existing chapters (e.g., a greatly expanded treatment of the growing theory of preferential trade agreements).
This comprehensive Dictionary brings together an extensive range of definitive terms in ecological economics. Assembling contributions from distinguished scholars, it provides an intellectual map to this evolving subject ranging from the practical to the philosophical.
The dominant paradigm of world trade patterns posits two principal features. Trade between North and South arises due to traditional comparative advantage, largely determined by differences in endowment patterns. Trade within the North, much of it intra-industry trade, is based on economies of scale and product differentiation. The paradigm specifically denies an important role for endowment differences in determining North-North trade. This paper provides the first sound empirical examination of this question. We demonstrate that trade in factor services among countries of the North is systematically related to endowment differences and large in economic magnitude. Intra-industry trade, rather than being a puzzle for a factor endowments theory, is instead the conduit for a great deal of this factor service trade.
Research activity in the IMF emphasizes the links between the organization's policy and operational concerns. The main objectives of research is IMF staff understanding of policy and operational issues relevant to the institution, and to improve the analytical quality of the work prepared for management and the Executive Board and the advice provided to member countries. The scope of research in the IMF is defined by the purposes and functions of the institution. In order to foster innovation and ensure quality control, the IMF makes much of its research available outside the institution and encourages staff to interact with academia and other research organizations through conferences, seminars, and occasional joint research projects. The visiting scholar’s program has also enhanced the quality of research done in the IMF. This program brings in leading members of the economics profession from around the world to assist in the preparation of papers for the Executive Board and to conduct research on IMF-related issues.
