We examine whether publicly-traded Czech firms that received foreign direct investment (FDI) before the end of 1995 had higher levels of total factor productivity during 1995-8. Preliminary data analysis reveals that, as restructuring occurred, many Czech firms left the sample during 1995-8 and that the recipients of FDI tended to be larger firms. We show that failing to tackle the associated sample attrition and selection problems substantially biases the estimated effects of FDI-as does pooling observations across industries (a common practice in the literature). Interestingly, taking account of only a subset of these concerns yields at best mixed results for the effects of FDI. In contrast, taking account of all of these econometric concerns produces a coherent pattern across industries of estimates of substantial benefits to firms that receive FDI.
This paper examines the multilateral governance of trade along with the prospects for its meaningful reform, in the light of recent, crisis-era discrimination against the many types of cross-border commerce. Prior episodes of protectionism provide a useful benchmark. The findings are not optimistic. The current set of multilateral rules is incomplete, has weak incentives for compliance, and can be readily circumvented. Only a far-reaching revision of these rules could induce more restraint.
This paper examines one political-economy aspect of the European Communities' (EC) anti-dumping policy that has tended to be overlooked in prior studies; namely, the role that member states play in deciding whether to impose definitive duties on imports that have been found to be dumped and that are deemed to have injured a European industry. We find that, in the late 1990s, numerous disagreements between member states occurred over the merits of imposing anti-dumping duties. These disagreements may well have been partly responsible for the strong decline in the number of European anti-dumping investigations initiated after 1999.
The latest wave of international market integration has seen a proliferation of bilateral and regional trading arrangements at the same time as the multilateral trading system has struggled to expand in scope. By and large, these developments have resulted in falling tariff and non-tariff barriers, fewer restrictions on inward foreign direct investments and, in some cases, the narrowing of regulatory differences. As the leading case of regional integration, the European Union (EU) and its predecessor the European Economic Community, is often held up as an example to other nations contemplating liberalisation with neighbours beyond their World Trade Organization (WTO) commitments.
We document the disappearance of numerous zeros in bilateral trade matrices since 1970. A novel decomposition of the growth of 23 developing economies' exports during 1970-97 reveals that approximately one third of this growth can be accounted for by sales of long-standing exportables to new trading partners. Product-line econometric analyses suggest that such export growth is often enhanced by market size and proximity, and also by experience gained in the destination and proximate markets. Three measures of the proximity of a potential export destination to foreign markets that are already being supplied by an exporting nation are employed. Their significance indicates the presence of a path dependent process of geographical spread of exports.
With the decline of government-imposed trade barriers policymakers have given greater attention to the international distortions created by the practices of private firms, including cartels. We critically evaluate the techniques used in the economic literature to estimate the effects of these private practices, finding them wanting on several grounds. In contrast, many of the necessary conditions for these practices to distort resource allocation are observable, which leads us to propose filters that policymakers can employ when evaluating accusations of impaired access to foreign markets or cartelization. Before undertaking an evaluation of the effects of a foreign private practice, policymakers would check whether the necessary conditions are in place for that practice to successfully distort market outcomes. Failure to pass this initial filter would lead to the accusation being dismissed. We discuss how this filter can be operationalized, drawing extensively upon published sources and empirical studies.
