infonet-economy

Global Value Chains (GVCs) have become a central topic in trade and development policy but little is known about their actual impact on economic performance because data availability has been limited. Using a new unique set of Inter-Country Input-Output tables with extensive country coverage, I look at the relationship between GVC participation and domestic value added at the…

In the wake of the Alstom restructuring, the French government indicated that current merger control rules do not allow for the development of European champions and called for a change in the rules. This paper argues that such a move may be not be advisable but that enforcement of the current rules should be improved, in particular regarding the assessment of efficiencies and the…

The real unit labor cost is an important variable in today's debate over competitiveness and labor cost imbalances in the Eurozone. This paper documents the link existing between developments in the labor share and relative monetary policy stance across euro area members. First I present the theoretical foundations of such link using a standard New Keynesian framework, then I…

When allocating their aid budget, development agencies need to decide whether to give outright grants or use concessional loans that blend a grant and credit element. Theory suggests that the degree of concessionality should be negatively correlated with debt sustainability. Several donors use the World Bank/IMF Debt Sustainability Framework to guide their aid decisions. They give…

This paper uses cross-country, firm-level, panel data to study how exporters from Low Income Countries (LICs) adjust their prices according to their trade partners’ characteristics. The results show that the free on board (fob) price of exports is differentiated across markets in all countries in the sample. This differentiated pricing is not commonly associated with small economies…

This paper examines how trade liberalization affects investments in R&D at the firm level. In a model where entrepreneurs are heterogeneous in their wealth endowment, they rely differently on external funds. In the presence of capital market imperfections, this implies heterogeneous access to external funds such that poor entrepreneurs run smaller firms, are less likely to invest…

Digital data from the political sphere is abundant, omnipresent, and more and more directly accessible through the Internet. Project Vote Smart (PVS) is a prominent example of this big public data and covers various aspects of U.S. politics in astonishing detail. Despite the vast potential of PVS’ data for political science, economics, and sociology, it is hardly used in empirical…

Guest-worker programs have been providing rapidly growing economies with millions of temporary foreign workers over the last couple of decades. With the duration of stay strictly limited by program rules in most of the host countries and wages paid to guest workers often set at sub-market levels, many of the migrants choose to overstay and seek employment in the underground economy.…

Based on a massive data collection effort since the St. Petersburg G20 summit last September, in which a further 2,001 trade-related state initiatives have been documented, this report demonstrates that the resort to protectionism has been substantially higher than previously thought.