Foreign Trade Review

- Publisher:
- Sage Publications, Inc.
- Publication date:
- 2021-08-12
- ISBN:
- 0015-7325
Issue Number
- Nbr. 57-3, August 2022
- Nbr. 57-2, May 2022
- Nbr. 57-1, February 2022
- Nbr. 56-4, November 2021
- Nbr. 56-3, August 2021
- Nbr. 56-2, May 2021
- 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
Latest documents
- Book review: Soumyen Sikdar, Ramesh Chandra Das and Rajib Bhattacharyya (Eds), Role of IT–ITES in Economic Development of Asia: Issues of Growth, Sustainability and Governance
Soumyen Sikdar, Ramesh Chandra Das and Rajib Bhattacharyya (Eds), Role of IT–ITES in Economic Development of Asia: Issues of Growth, Sustainability and Governance. Springer, 2020, pp. 329, Ä109.99 (Hardback), Ä79.99 (Paperback), ISBN 978-981-15-4205-3.
- Special Issue on ‘Global Trade and FDI: The Road Ahead’
- FDI: Hot or Cold Money? The Behaviour of Sectoral FDI Inflows and Outflows Over Periods of Growth Accelerations and Decelerations
The economic crisis caused by the COVID-19 pandemic invokes questions about a possible prolonged economic deceleration. In this article, we study the impact of output growth accelerations and decelerations, as per the definition of Arbache and Page (2007, More growth or fewer collapses? A new look at long run growth in Sub-Saharan Africa [Working Paper 4384]) and Conceicao and Kim (2010, The asymmetric impact of growth fluctuation on human development: Evidence from correlates of growth decelerations and accelerations. Mimeo), on sector-level foreign direct investment (FDI) inflows and outflows for a group of 34 OECD countries in the period 1995–2019. The results show that Finance services FDI and transport services FDI inflows are countercyclical, while manufacturing FDI outflows are procyclical. Transport services FDI outflows are countercyclical, and the most significant determinant of both FDI inflows and outflows is the control of corruption, respectively, in the host and home countries. JEL Codes: F21, O16, O19
- Foreign Direct Investment and Output Volatility Nexus: A Global Analysis
Volatility in output growth remains a genuine concern around the globe because of its detrimental effects on growth, poverty and welfare. In the realm of output volatility, the role of FDI and its consistency is particularly important and worth considering. This article examines the role of FDI inflows and specifically the instability in it on output growth volatility using a panel dataset of 141 world economies for the period 1971–2017. The study employs a variety of estimation techniques like pooled ordinary least squares (POLS), LS fixed effects (FE), LS random effects (RE), two stage least squares (2SLS) and generalised methods of moments (GMM). Findings of the study suggest that FDI acts as the volatility reducing factor, whereas uncertainty in it increases output volatility. On the policy front, this study recommends policies that not only encourage FDI inflows but also ensure the inflows to be more consistent and stable. Our results are robust corresponding to various above-mentioned estimation techniques and sensitivity analysis. JEL Codes: C23, E32, F21
- The Impact of Bilateral Investment Treaties on FDI Inflows Into India: Some Empirical Results
After a run of adverse investor-state dispute settlements, India has recently denounced all its erstwhile investment treaties. New investment treaties need to be negotiated on the basis of a new Model Treaty that privilege state rights over investor rights. We study the impact of bilateral investment treaties on foreign direct investment (FDI) inflows into India before the denunciation with the intent of inferring the consequences of changing the system. Our work captures the effects of international investment agreements on FDI inflows specifically into India. We construct an empirical model drawing on the Gravity Model, and estimate parameters using generalised method of moments. The results show that while the individual signing of bilateral investment treaties does not influence the inflow of FDI, the effect of the cumulative bilateral investment treaties signed is statistically very significant—suggesting that the spill over effect of signing a series of bilateral investment treaties are important, signalling a regime of overall protection to investors. The importance of institutional variables in influencing FDI tells us that overall participation in a system governed by international investor agreements influenced the inflow of FDI positively and therefore recent policy changes should be viewed with caution. JEL Codes: F21, F23, F550, F63, K33, O19, C22, C29
- Analysing Opportunities for India in Global Value Chains in Post COVID-19 Era
In recent years, trade in intermediate goods has increased manifold with the emergence of global value chains (GVCs). China has emerged as one of the leading countries in the whole GVC network; many countries, including the USA, are heavily dependent on China for the intermediates in the manufacturing sector. The outbreak of COVID-19 and the subsequent lockdowns in many countries, including China, have disrupted the supply in GVCs. This situation has led to the search for alternative markets for intermediates for the sustainable-production process. This study looks at how India can be an alternative avenue for the USA in place of China in the GVC network. It investigates the extent of participation of the countries under study in the GVCs and the gains resulting from it. The main focus of the research is to determine the emerging opportunities for India in GVCs, through correlating the USA industries which are vulnerable to disruption in GVCs as caused by China to those industries of India in which India enjoys a comparative advantage. The analysis reveals that in the ‘textiles, wearing apparel, leather and related products’ and ‘chemicals and non-metallic mineral products’ industries, India could be a replacement of China for the USA. JEL Codes: F10, F13, F15
- The Dynamics of Export Diversification, Economic Complexity and Economic Growth Cycles: Global Evidence
This article investigates the dynamics of export diversification, economic complexity and economic growth cycles. By applying several econometric techniques for estimating a panel data set of 70 economies over the period from 1996 to 2014, the results have been threefold. First, there is Granger bi-directional causality between economic complexity and export diversification, while unidirectional Granger causality exists from economic complexity to economic growth cycles. Second, the result attained from the three-stage least squares estimate demonstrates that economic complexity and export diversification significantly impact each other. Notably, the effect of economic complexity is found to be negative on economic growth cycles, implying that the dynamics of economic complexity and export diversification generate a reduction in economic fluctuations. Third, by splitting the sample into two subsamples (i.e., 32 high-income economies and 38 low- and middle-income economies) and two sub-periods (i.e., 1994–2007 and 2008–2014), the results show that the positive dynamics between economic complexity and export diversification are consistent with income levels and time periods. However, the negative impact of economic complexity on economic growth cycles is statistically significant only for the group of high-income economies and during the 1996–2007 period. These findings are checked by several estimators and different proxies of export diversification, economic growth cycles and economic complexity. JEL: F13, F14, O19, E32
- The Effect of COVID-19 Pandemic on the Global Supply Chain Operations: A System Dynamics Approach
Epidemic outbreaks are one of the important sources of the risk in the global supply chains. Before the COVID-19 pandemic, global industries that were unprepared for disruptions experienced a decline due to the pandemic. A global supply chain is a complex system set of dynamics that could be analyzed by the system dynamics approach. In this article, the impact of the recent pandemic on the global supply chain is simulated in different scenarios. A system dynamic model is developed to carry out the simulations. In order to consider the impact of the pandemic on the exogenous and endogenous variables, a force majeure factor is defined in the model. Global features considered in this article are the export and import operations, the exchange rate and the rate of tariff. In this article, a scenario analysis is performed to analyze two important factors of the global supply chain: force majeure factor and delivery delay. Results showed that improving the flexibility of production capacity is one of the important strategies that global supply chain managers should pursue. JEL Codes: F23, P45, C15, C63, E37, F17
- India’s Merchandise Exports to Asia: A Constant Market Share Analysis
The present study attempts to examine the structural changes in Indian merchandise exports to Asia during the period 1980–2016 by using Constant Market Share (CMS) analysis. The index values of the CMS analysis suggest that India has mostly maintained and strengthened its export market share primarily in resource-based and low tech/labour-intensive products. Major technology-intensive exports include organic chemicals and dyes and colouring materials to all its export destinations in Asia. The market effect result shows a positive impact on India’s export performance which suggests that India has diversified its exports to South Asia, Southeast Asia and West and Central Asia. However, market adaptation effect result shows negative impact in East Asian market which means that India is lacking in adapting the import structure of this market. JEL Codes: F1, F14, F43, L6, O53
- Preference Distortion, Information Cost and Comparative Advantage: A Theoretical Quest to Claim Trade Posture in Post-Pandemic Era
This study argues that post-pandemic world may not necessarily follow the usual mechanism of trade. In fact, recent pandemic dragged down us to the trajectory of new normalcy. Economic behaviour under new normalcy has changed immensely following several distorted effects, namely preference distortion and information asymmetry. Such distortions change trade posture via gains from trade arguments under comparative advantage. Using the traditional Ricardian model with two countries, two goods and one factor, this study explores the effect of changes in consumer preferences on trade patterns based on comparative advantage and the significance of eliminating information uncertainty. To retain the pre-pandemic gains from such trade this study advocates for consideration of information cost associated with trade basket along with innovation. These results could be important for policymaking at least in post pandemic regime. Sensitivity analysis has also been constructed to capture the extent of changes in trade–autarky profit gaps. This study builds on the verge of economic crisis linking to pandemic and international trade. JEL Codes: C70, D81, F11, L15
Featured documents
- Assessing the Impact of Great Recession on India’s Trade in Gravity Model Framework
This study examines the efficacy of trade channel in the transmission of recent Great Recession impulses to the Indian economy. To investigate the impact of Great Recession on India’s trade, gravity model of trade was estimated by regressing trade flows on size of economies, level of economic...
- The Effect of the European Union Customs Union on the Balance of Trade in Turkey
This article investigates the effect of the customs union between Turkey and the European Union on the balance of trade in Turkey. The framework for analysis is an extended trade gravity model onto which the impact of the customs union is applied. The gravity model of trade is estimated using...
- The Information Technology Agreement and the ‘Make-in-India’ Initiative
The World Trade Organization’s Information Technology Agreement (ITA), which was concluded at the Singapore Ministerial Conference in 1996, is considered to be one of the biggest tariff-cutting deals by virtue of eliminating all customs-related duties on the exportation of certain categories of...
- Consistency Test of Revealed Comparative Advantage Index: Evidence from India’s Agricultural Export
This article analyses the competitiveness of India’s agricultural products in world markets. Four indices of revealed comparative advantage (RCA) were used at the four-digit level of harmonized system (HS) of classification for the period of 1996–2015. Under live animal products, 7 out of 26...
- Book review: Soumyen Sikdar, Ramesh Chandra Das and Rajib Bhattacharyya (Eds), Role of IT–ITES in Economic Development of Asia: Issues of Growth, Sustainability and Governance
Soumyen Sikdar, Ramesh Chandra Das and Rajib Bhattacharyya (Eds), Role of IT–ITES in Economic Development of Asia: Issues of Growth, Sustainability and Governance. Springer, 2020, pp. 329, Ä109.99 (Hardback), Ä79.99 (Paperback), ISBN 978-981-15-4205-3....
- Book review: Pralok Gupta (Ed), E-Commerce in India: Economic and Legal Perspectives
Pralok Gupta (Ed), E-Commerce in India: Economic and Legal Perspectives. New Delhi: SAGE Publications, 2020, INR 1,250, 328 pp. ISBN 978-93-538-8356-0....
- Shifting of Pollution Loads to Informal Units in India: A Possible Escape Route for Compliance with WTO Standards
This article tries to examine the environmental and social costs imposed on the Indian economy as a result of globalization. It is shown that in the world market, India has strong revealed comparative advantage (RCA) in a number of dirty products. Constant Market Share (CMS) analysis for these...
- A Study on Environmental Compliance of Indian Leather Industry & its
Far-reaching Impact on Leather Exports
Indian Leather Industry is recognized as one of the most promising foreign exchange earning sectors since early 1970s. The industry was hard hit by two consecutive foreign environment bans since 1989. Along with that, few domestic environmental regulations also ...
- Environmental Compliance of Indian Leather Firms in the Post-WTO Period
India is one of the major exporters of leather products. However, the exporting firms need to conform to a number of environment-related compliance requirements in foreign markets, which function as a major barrier. For instance, the introduction of the German ban on import of leather products with ...
- 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,...