Foreign Trade Review
- Sage Publications, Inc.
- Publication date:
- Nbr. 56-1, February 2021
- Nbr. 55-4, November 2020
- Nbr. 55-3, August 2020
- Nbr. 55-2, May 2020
- Nbr. 55-1, February 2020
- Nbr. 54-4, November 2019
- Nbr. 54-3, August 2019
- Nbr. 54-2, May 2019
- Nbr. 54-1, February 2019
- Nbr. 53-4, November 2018
- Nbr. 53-3, August 2018
- Nbr. 53-2, May 2018
- Nbr. 53-1, February 2018
- Nbr. 52-4, November 2017
- Nbr. 52-3, August 2017
- Nbr. 52-2, May 2017
- Nbr. 52-1, February 2017
- Nbr. 51-4, November 2016
- Nbr. 51-3, August 2016
- Nbr. 51-2, May 2016
- National Defence Under Alternative Trade Policy Regimes: Theory and Evidence from Developing Countries
Defence mechanism for any nation is the way through which internal as well as external geo-political condition can be stabilised. Moreover, defence sector can also be treated as one of the most potential sectors regarding financial transactions and the relevance of it is valid both in autarky and in the regime of international trade. Using Granger Causality for a panel of 27 developing countries across Asian and South American continents, we have found that different trade measures are playing major role in the way of functioning of national defence. For further analytical purpose and also to select the most effective trade policy regime among the alternatives, we have adopted a trade theoretic framework. In this regard, we have used a four-sector general equilibrium trade model with special emphasis on defence as well as R&D to defence to illustrate the impact of trade liberalisation on defence system. From such setup and by using bootstrap policy simulation we have found that trade liberalisation in the form foreign direct investment (specific to the R&D to defence) as the most effective trade regime to claim gains from trade in the presence of defence dualism for any small open developing economy. Such comparative statics is critical from the policy perspective. Policymakers should be cautious before defence industry liberalisation. JEL Codes: H56, C33, F11, F14, F21, D58
- Does Trade Openness Affects Employment in Cameroon?
The objective of this paper is to examine the effect of trade openness on employment in Cameroon. The methodologies used in order to test our hypothesis were the FMOLS and DOLS. The results of the estimations show a positive and significant effect of trade openness on employment in Cameroon with both methods. Indeed, industrialisation and investments were found to significantly increase employment in Cameroon. As recommendations, if Cameroon envisages expanding in international trade, she should encourage sectors that have a spillover effect. These include increasing industrialisation which will lead to increase in national productivity. Furthermore, the educational system should match training with jobs. JEL Codes: F16, C22
- Trade Mis-Invoicing Between India & USA: An Empirical Exercise
India shares its majority of international trade with the United States of America. But a huge amount of discrepancy is frequently observed in the recorded bilateral trade statistics between these two countries. The main reasons are caused by several restrictions prevailing on the account of international trade in India. Export is found to be under-reported consistently whereas import data shows both over and under mis-invoicing in a periodic swing. This paper focuses on the determinants of this data fabrication with the help of empirical exercises. Several macroeconomic policy variables are taken to build up an econometric model and are tested statistically with the help of time series econometrics. Among all, relative interest rate plays the most important role to influence export and import mis-invoicing, followed by spot exchange rate and forward exchange rate. The exercise also finds a uni-directional causal relationship from import mis-invoicing of a period to export mis-invoicing of the next period. JEL Codes: C10, C13, C61, F13, F14, F21, K42
- Evaluating Asian Free Trade Agreements: What Does Gravity Model Tell Us?
This paper evaluates the performance of Free Trade Agreements (FTAs) by analysing the determinants of trade flows of Asian economies for a panel of 31 countries during 2007–2014 using a Gravity model. The estimated results suggest that certain FTAs negatively contribute to trade flows across the region and, that GDP and population, among other factors, can explain total trade flows. This study also finds that trade costs using distance as a proxy has a significant and negative effect on trade. Our results are in-line with the expectations which can be drawn by looking at trends of trade flows in Asia. Thus, a case is attempted for smoothening trade-flows across the region by reducing tariff and non-tariff barriers, pumping in investments on transport infrastructure and improving productivity of the partners as a whole which has positive effects on GDP and thus trade. JEL Codes: F13, F14, C23
- Impact of Exchange Rate Changes on the Trade Balance of India: An Asymmetric Nonlinear Cointegration Approach
Applying an asymmetric model, the study reported no evidence of J-curve phenomenon in case of India. In the short-run currency appreciation deteriorates the trade balance and currency depreciation improves it. In the long-run, again the similar response is observed, however, only the impact of currency depreciation is statistically significant. Increase in domestic demand deteriorates the trade balance by a greater magnitude than improvement is observed due to the decline in domestic demand conditions. Finally, foreign demand hike improves the trade balance relatively by a higher magnitude; however, the impact of a foreign demand decline is statistically insignificant. JEL Codes: F4, F41, F42
- Post-SAFTA NTMs for Agricultural Trade: Revelations from the India–South Asia Approach
Commitment of South Asian Free Trade Agreement (SAFTA) from South Asian Preferential Trading Agreement (SAPTA) for trade liberalisation was one of the hopes in South Asia. This article highlights untapped trade potential in agro-trade between India and its trading partners in South Asia through Trade Potential Index (TPI). This article evaluates post-SAFTA effects of non-tariff measures (NTMs) on agro-products (HS 6-digit level) over the period 2004–2016. After 2004, many agro-products of South Asia have suffered trade restrictions which create challenges over SAFTA implementation. This article inquires whether NTMs in post-SAFTA has been trade creating or trade inhibiting in agro-trade for member countries as per the earlier commitments. Research methodology for this study includes qualitative and quantitative approach. Qualitative approach examines agri-trade constraints faced between India and rest seven South Asian countries and vice versa. Quantitative analysis explores prevailing trade barriers in selected agro-products during 2002–2016 applying Regional Trade Barrier Index and NTM Coverage Ratio. Results establish the presence of agri-trade barriers from South Asian countries against India as well as India’s barriers against rest seven countries of South Asia. Study concludes that agri-trade restrictions prevail in South Asia despite SAFTA which shows the slow process of trade liberalisation. JEL Codes: F13, F14, Q17
- Financial Crisis, Globalisation and Development in Africa
This study unites two streams of research by simultaneously focusing on the impact of financial globalisation on financial development and pre- and post-crisis dynamics of the investigated relationship. The empirical evidence is based on 53 African countries for the period 2004–2011 and Generalised Method of Moments. The following findings are established. First, whereas marginal effects from financial globalisation are positive on financial dynamics of activity and size, corresponding net effects (positive thresholds) are negative (within range). Second, while decreasing financial globalisation returns are apparent for financial dynamics of depth and efficiency, corresponding net effects (negative thresholds) are positive (not within range). Third, financial development dynamics are more weakly stationary and strongly convergent in the pre-crisis period. Fourth, the net effect from the: pre-crisis period is lower on money supply and banking system efficiency; post-crisis period is positive on financial system efficiency and pre-crisis period is positive on financial size. JEL Codes: F02, F21, F30, F40, O10
- Book review: Xu Qian, Water Services Disputes in International Arbitration: Reconsidering the Nexus of Investment Protection, Environment, and Human Rights
Xu Qian, Water Services Disputes in International Arbitration: Reconsidering the Nexus of Investment Protection, Environment, and Human Rights. The Netherlands: Kluwer Law International BV, 2020, xiv+280 pp., GBP 156.51. ISBN 978-94-035-2203-6.
- The Effect of Infrastructure and Logistics Performance on Economic Performance: The Mediation Role of International Trade
This paper evaluates the effect of infrastructure and logistics performance on economic performance. In addition, the mediating role of international trade on the relationship between infrastructure and economic performance, and logistics performance and economic performance, respectively. Generalized Structured Component Analysis (GSCA) was proposed as a Component-Based Approach to Structural Equation Modeling (SEM) to test several hypotheses regarding the interaction of the latent variable. Furthermore, the mediation analysis using regression was performed. Based on data from middle income selected countries, the hypothesis about the mediation role of international trade was partially supported. Our results also suggest that infrastructure and logistics performance improvements may enhance middle-income countries sustainable growth with increasing international trade volume. JEL: F43, L90, P33
- ‘Efficiency and Performance of Global Supply Chain: Theory and Evidence’
- On the Legality of the United States Action of Terminating India’s GSP Status
Since the US Presidential Proclamation terminating India status as a Generalized System of Preferences (GSP) beneficiary with effect from 5 June 2019, questions are raised on the WTO legitimacy of such an action. The US measure, which appears to have a punitive element—a move precipitated by lack...
- ‘Twin Deficits’ Hypothesis
Higher and persistent level of fiscal deficit and current account deficit is the problem of the day for Indian economy. There exists an argument that higher fiscal deficit is the major factor behind worsening balance of payments position. However, there is no identical perception on the...
- Trade, Inequality and Distribution-neutral Fiscal Policy
Gains from trade and inequality do not feature prominently in trade theory. The standard criterion of Pareto efficiency indicates nothing about inequality when applied to the redistribution of gains from trade. Yet, trade-induced inequality has become a talking point and extremely contentious issue ...
- Foreign Aid and Corruption: Clarifying Murky Empirical Conclusions
This study considers foreign aid flow by sector in which the aid is directed and then estimates its impact on corruption in order to clarify the specific direction of aid flow that triggers (or does not trigger) corrupt practices. Data are from the Organisation for Economic Co-operation and...
- Book Review: Arpita Mukherjee, Rupa Chanda and Tanu M. Goyal (eds), Trade in Services and Trade Agreements: Perspectives from India and the European Union
- India’s Health-care Sector under GATS: Inquiry into Backward and Forward Linkages
With the opening up of trade in health services under the General Agreement on Trade in Services (GATS), India is finding herself in an advantageous position in terms of reaping the benefit of this enhanced global connectivity. Here, the presence of a sizeable middle class in urban areas,...
- Creating a Disaggregated CGE Model for Trade Policy Analysis: GTAP-MVH
Thousands of economists spread across almost every country use the GTAP model to analyse trade policies including trade wars and trade agreements. GTAP has an impressive regional coverage (140 countries), but the standard commodity coverage (57 commodities/industries) can cause frustration when...
- External Sector: Between Congestion and Sanctions—‘Syrian Economy Case, 1987–2018’
Since the outbreak of the Syrian crisis in March 2011, the USA, European Union, Arab League and several other regulatory entities imposed negative economic sanctions on Syria—some of the most comprehensive ever implemented. This article first provides an assessment of Syrian foreign trade sector...
- Reducing Dwell Time Related to Clearing and Forwarding of Export and Import Goods at Kolkata Sea and Air Ports
The article traces the opportunities for reducing the dwell time taken during clearing of export and import (EXIM) goods at Kolkata sea and air ports. As observed in the Government of India reports, the dwell time in Indian airports is considerably higher than that of global benchmarks. Drawing...
- Exchange Rate Pass-through to Domestic Prices
This study makes an attempt to examine the exchange rate pass-through (ERPT) to domestic prices in the post-reform period in India. It also analyzes the effect of global financial crisis of 2007 on the ERPT. It has used the standard vector auto-regression (VAR) model taking five variables (viz.,...