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Since the Ice Silk Road (ISR) was put forward, its development prospect has become the focus of academic circles. To study the influence mechanism of 'fairness preference' on the trade cooperation of countries along the ISR, this paper constructs the trade cooperation network based on the bilateral trade data of countries along the ISR, establishes the theoretical model of network game based on Rabin model, and uses the simulation method to test the model. The results show that: (1) the sense of national cognitive fairness does have an impact on the trade cooperation of the ISR; (2) the 'eye for an eye, tooth for a tooth' strategy is not an advantage strategy in the trade cooperation of the ISR; (3) the most significant factor affecting the trade cooperation of countries along the ISR is the neighbor node in the trade network and the social public opinion pressure of cooperation in the network. [ABSTRACT FROM AUTHOR]

Purpose: The authors investigate the impact of the US stock market on the economies of the BRICS and major industrialized economies (G7). Design/methodology/approach: The authors construct the world economy and the vulnerability between economies using three economic integration variables: bilateral trade, bilateral direct investment and bilateral equity positions. Global vector autoregressive (GVAR) empirical studies usually adopt trade integration to estimate models. The authors complement these studies by using bilateral financial flows. Findings: The authors summarize the results in four points: (1) financial integration variables increase the effect of the US stock market on the BRICS and G7, (2) the US shock produces similar responses in these groups regarding industrial production, stock markets and confidence but different responses regarding domestic currencies: in the BRICS, the authors detect appreciation of the currencies, while in the G7, the authors find depreciation, (3) G7 stock markets and policy rates are more sensitive to the US shock than the BRICS and (4) the estimates point out to heterogeneities such as the importance of industrial production to the transmission shock in Japan and China, the exchange rate to India, Japan and the UK, the interest rates to the Eurozone and the UK and confidence to Brazil, South Africa and Canada. Research limitations/implications: The results reinforce the importance of taking into account different levels of economic development. Originality/value: The authors construct the world economy and the vulnerability between economies using three economic integration variables: bilateral trade, bilateral direct investment and bilateral equity positions. GVAR empirical studies usually adopt trade integration to estimate models. The authors complement these studies by using bilateral financial flows. [ABSTRACT FROM AUTHOR]

This study investigates the impact of a minority language on international trade. Using the distance to Hunchun as an instrumental variable, and transaction-level customs data from 2000 to 2015, we investigate the causal impact of common Korean language on international trade between Chinese counties and South/North Korea. The results suggest that a 1% increase in the proportion of population speaking Korean will increase value share and transactions share in trade by 1.8% and 2.3%, respectively. These effects are more pronounced in trade with North Korea and in higher trade share regions. Furthermore, we show that the common Korean language exerts its influence through reducing communication barrier. The impact is mainly observed at the extensive margin rather than the intensive margin. These findings highlight the potential of leveraging minority languages to boost bilateral trade in developing countries. [ABSTRACT FROM AUTHOR]

Malaysian Japanese speaking graduates with Japanese language proficiency (JLP) and business Japanese competence (BJC) employed in Japanese companies (JC) in Malaysia are considered an asset by their employers. However, to what extent are their JLP and BJC sufficient to function in JC is an under researched area and deserves further scrutiny. Therefore, the focus of this research is to identify JC employers’ JLP and BJC requirements of Malaysian Japanese speaking graduates in their Malaysian companies. This qualitative research via semi-structured one-to-one interviews with JC employers of selected companies in Malaysia investigated the requirements of JLP and BJC for Malaysian Japanese speaking graduates employed in JC. The findings revealed that JLP requirement is dependent on position and task whereas time management and business customs, Ho/Ren/So (Reporting / Contacting / Consulting) are considered as important BJC practices. Furthermore, speaking and listening in Japanese language is considered as crucial skills and the most challenging for Malaysian Japanese speaking graduates at JC to master. Incorporating Japanese business customs and workplace practices in Japanese language curriculum at higher education and increasing internship opportunities at JC would ensure Malaysian Japanese speaking graduates acquire the required JLP and BJC through their higher education. This research augurs well for the enhancement of Japanese language curriculum in higher education institutions in Malaysia as well as Japan-Malaysia bilateral trade to further strengthen Japanese companies’ presence in Malaysia and attract new Japanese investments with high level of JLP and BJC manpower. [ABSTRACT FROM AUTHOR]

This paper examines the jump risk contagion between the US and China during the financial crisis driven by COVID-19, and the impact of a series of determinants to detect the transmission mechanisms. Specifically, we employ the ARJI–GARCH model to capture jump behavior and apply the Clayton Copula to construct lower tail jump contagion. Furthermore, we conduct regression analysis on variables related to economic fundamentals and investor behavior to explore the fundamental or pure contagion hypotheses. Our results suggest an increased jump dependence during major catastrophic crises such as COVID-19, but it is closer to a memory-less process. Besides, bilateral trade, similarity in fundamentals and investor behavior are all important determinants, and pure contagion hypothesis exists between the Chinese and US stock markets during the pandemic. [ABSTRACT FROM AUTHOR]

This study employs the new panel data structural gravity approach to investigate the overarching effect of ICT on bilateral trade flows and economic growth, by using a panel of 65 Belt and Road initiative (BRI) countries. This comprises of twenty-seven (27) sub-Saharan African countries from the period 2000 to 2019. The empirical results indicate that greater access to ICT deepens bilateral export and growth among participating countries. Essentially, the results demonstrate a positive correlation between ICT growth and economic development in the BRI countries. Overall, the findings reveal that ICT and infrastructural growth have provided the East African Community (EAC) a lot of opportunities to boost intra-regional trade. However, the BRI countries need to invest more heavily in ICT infrastructure to foster a continuous and sustainable economic development paradigm within the enclave. [ABSTRACT FROM AUTHOR]

This paper revisits the question of choice between regionalism and multilateralism in trade relations of Central Asia introduced by Pomfret (2005). Our study is motivated by a significant restoration of economic links between the former Soviet republics following Russian accession to the World Trade Organization (WTO), the creation of the Eurasian Economic Union (EAEU), and the formation of new trade ties with Vietnam, Iran, and Serbia. Above all, there have been substantial commitments made by the three Central Asian republics of Tajikistan, Turkmenistan, and Uzbekistan toward a multilateral system under the WTO rules. To this end, we apply a multi-region gravity model with interdependent trade flows using bilateral trade data of Tajikistan and Uzbekistan to study the ex-ante effects of economic integration with various bilateral, plurilateral, and multilateral partners. Our findings indicate the existence of considerable gains if the aforementioned economies would ascend to the EAEU in comparison to integration with China or Iran. We also document the presence of shared economic links between Tajikistan, Central Asia, and Turkey. [ABSTRACT FROM AUTHOR]

• We develop a model on how military and trade alliances can impact defense spending. • Importance of trade and its balance with the leader influences defense spending. • The larger the leader's trade and surplus, the lower the minor partners' spending. Military spending was the main government expenditure until the 20th century, and it still represents a significant fraction of most governments' budgets. We develop a theoretical model to understand how both military and trade alliances with military leaders can impact defense spending. By increasing the costs of military aggression by a non-ally, an alliance reduces the probability of war and allows minor partners reducing their military spending in exchange for a stronger trade relationship with an alliance leader and a higher trading surplus for the latter. We test our hypotheses with data on 138 countries for 1996–2020. Our results show that the importance of the trade relationship and the trade balance with the military alliance leader is a significant driver of military spending. The greater the weight of trade with the military leader and the higher its trade surplus, the lower is the defense spending of the minor partner. [ABSTRACT FROM AUTHOR]

The model corridor stretching from Mumbai (India) to St. Petersburg (Russia) through Iran and Azerbaijan is known as the International North-South Transport Corridor (INSTC). This multi-modal corridor is around 7,200 km long and consists of rail, roads, and waterways. The main objective of the construction of the corridor is to improve connectivity and trade relations between the North and the South. It will play a crucial role in promoting regional cooperation and economic integration. Bilateral relations between the member countries will be developed through the project. India will have easy access to the resourcerich Central Asian nations via this corridor, bypassing Pakistan. It will help India by exporting its products to the North and Central Asian countries, including Russia, and importing hydrocarbons at a lower cost by avoiding the traditional long-time route. In the present geopolitical situation, this venture will also improve India's strategic relations with the member countries. Although the project at present is suffering from some glitches, it will be a game changer for India's Eurasia policy in the near future. [ABSTRACT FROM AUTHOR]

Strong commercial ties promote peace as states shun the opportunity costs of economic disruption. However, trade also enriches and empowers states, rendering them more capable of enforcing long-term settlements. Given economic disruption does not last forever, countries can be incentivized to trade short-term economic losses for long-term political or territorial gains. This trade-off can restrict or even reverse the pacifying effect of commerce as it renders states incapable of committing to existing peaceful deals. I argue the scope condition hinges on the existing power imbalance and the security externalities of trade, defined as states' abilities to translate trade gains into (potential) military power. For countries where the existing power gap is not extreme, the impact of bilateral strategic trade is contingent upon a country's trade externality relative to its opponent's. Although increased bilateral trade can be peace-promoting when the relative externality is small, the pacifying effects can dissipate as a relatively weaker state becomes more capable of exploiting trade gains. Building on recent work in network analysis, I propose a new measurement of trade externalities to test the above theory and find supporting results. [ABSTRACT FROM AUTHOR]

This study delves into the economic and trade relations between Turkey, the UAE, and Saudi Arabia over the past five years, highlighting the evolution driven by strategic interests and regional stability. The research analyzes secondary data, examining official trade and investment reports, government statements, international organization data, and academic articles. It also considers diplomatic developments such as highlevel visits and agreements. The period from 2020 to 2024 witnessed significant growth and diversification in trade among these nations. Turkey's exports to the UAE and Saudi Arabia increased markedly, driven by sectors like agricultural technologies, food security, clean energy, and construction. Key moments include the establishment of a $10 billion investment fund following UAE President Sheikh Mohammed bin Zayed Al Nahyan's visit to Turkey in 2021 and the signing of the Comprehensive Economic Partnership Agreement (CEPA) in 2023, aiming to elevate bilateral trade to $40 billion over five years. Simultaneously, Turkey's economic relations with Saudi Arabia experienced fluctuations but generally depicted a positive trend. High-level visits by President Recep Tayyip Erdoğan and Saudi Crown Prince Mohammed bin Salman revitalized economic ties, resulting in cooperation agreements across various sectors, including health, energy, and the defense industry. The economic relations between Turkey, the UAE, and Saudi Arabia reflect a dynamic interplay of strategic interests, mutual investments, and shared goals. The strengthened economic partnerships have contributed to regional stability and are expected to develop further, driven by strategic collaborations in energy, technology, and infrastructure. These developments underscore the importance of economic diplomacy and mutual investments in shaping future cooperation prospects and regional power dynamics. [ABSTRACT FROM AUTHOR]

US international trade policy under both the Trump and Biden administrations has been increasingly protectionist. This paper considers two policy scenarios under active discussion: (1) an across-the-board increase in all US tariffs by 10 percentage points, and (2) a severe escalation of the US trade war with China. The scenarios are analyzed using a multi-country computable general equilibrium (CGE) simulation model of the global economy. Trade wars or policy regimes of widespread protection will increase tariffs in many sectors simultaneously and include both final goods and intermediate inputs. The impacts are complex, with a web of direct and indirect forces coming into play across domestic and international markets. The global CGE model captures these mechanisms, including both short and long-run effects, with and without retaliation by partner countries. In a world economy where the US accounts for only 10 % of global trade and potentially rival trade bloc have emerged in Europe and E&SE Asia, the US is no longer hegemonic in global markets. We find that across-the-board tariffs do not protect manufacturing jobs because the cost of imported intermediate goods increases, raising costs in manufacturing production. The US trade war with China leads to a dramatic fall in bilateral trade. Other countries expand their trade to China and the US with the exception of closely linked partners (e.g. Canada and Mexico and all countries in E&SE Asia). We find that the world economy can adjust to US trade wars, diverting trade around the US. [ABSTRACT FROM AUTHOR]

Purpose: This study deals with changes in European Union's (EU's) trade potential in Machinery (HS 84–85) and Transportation (HS86-89) products. Design/methodology/approach: The study uses a Structural Gravity model, Poisson Pseudo Maximum Likelihood (PPML) estimation together with panel data for the years 2002–2018 and a two-step procedure that employs predicted values of bilateral trade to compare potential to actual trade. Findings: Results for Machinery products suggest a potential to expand trade with existing Regional Trade Agreements (RTAs) in the American continent, and countries of the IGAD region in Africa. In Transportation, a high trade potential with RTAs is found in the Americas, Africa and the Middle East. Policy suggestions concentrate on opportunities for enhancing trade relations through trade liberalization and agreement proliferation. Originality/value: There are no studies to date, that examine "collective" measure of EU trade potential, that treats the EU as a single country. Changes in existing opportunities to expand trade, common for EU members, are of special interest for policy formulation, especially after the recent turmoil presented by the Global Financial Crisis (GFC) and the Greek Economic Crisis (GEC). Treating the EU as a single entity, is necessary for the formulation of an effective, common, EU trade policy. This study concentrates on the manufacturing sector to examine existing opportunities for the EU to expand trade, after the GFC and the GEC. This article deals with Machinery (HS 84 and 85) and Transportation (HS 86 through 89) products as they comprise a significant part of total EU exports, reaching 41% of total exports in 2016. Finally, this study offers a unique illustration of results through trade potential heat maps. [ABSTRACT FROM AUTHOR]

Purpose: This article analyzes the impact of monetary policy on income inequality across 16 advanced economies. The author investigates three key points: (1) the relationship between domestic monetary policy and domestic income inequality, (2) the spillover effect of USA monetary policy (including quantitative easing) on international inequality and (3) the quantitative influence of the monetary policies of both the USA and the Eurozone on the formation of domestic income inequalities. Design/methodology/approach: The author employed the Global Vector Autoregressive (GVAR) model, which uses Vector Autoregressive with Exogenous Variables (VARXs) models of each economy to build an integrated system that enables us to evaluate individual responses to global shocks. Findings: The author's analysis reveals that (1) contractionary monetary policy exacerbates domestic inequality and (2) USA monetary policy, including quantitative easing, affects international inequality. Furthermore, the author's variance decomposition analysis highlights that USA monetary policy is especially influential on income inequality in Norway and Sweden. Additionally, the cointegrating analysis confirms that monetary policy's impact on inequality persists in the long term. Originality/value: Most of the studies focused on investigating domestic economies as closed economies. However, the author's approach differs in that the author uses the GVAR, which treats all economies as open. This allows us to incorporate the world economy into the domestic dynamics and connect the economies using bilateral trade. Another advantage of the GVAR is that it captures spillover effects by modeling each economy and constructing the international economy. [ABSTRACT FROM AUTHOR]

This paper investigates if individuals' negative assessments of the future drive micro-level reluctance for international cooperation and reciprocal behavior, a core principle of multilateralism. To test our theoretical expectations, we field online survey experiments on a sample of over 3000 respondents in the US and Turkey in October–November 2020. The experimental results show that on average, individuals are fairly sensitive to target countries' policy actions and are inclined to reciprocate when contemplating whether to increase contributions to UN or consent to bilateral trade liberalization. Yet, further analyses concur that individual inclinations to reciprocate are substantially moderated by their future expectations. Specifically, individuals who are more pessimistic about their material prospects remain fairly indifferent to the positive actions of other countries, but are more likely to penalize negative foreign policy actions by reciprocating in kind. [ABSTRACT FROM AUTHOR]

Ecuador has maintained an active participation in the international market thanks to the improvement of the productive sectors, plus the management of representative organizations abroad, managing to promote negotiation ties with global organizations such as the European Union. Commercial import transactions have estimated a growing development in several regions of the country, especially in the rural sector. For several years there have been imported products such as agricultural inputs that necessarily forge and demand a constant utility, to sustain local productions. [ABSTRACT FROM AUTHOR]

Increasing urgency to address climate change has heightened efforts by the world's highest-emitting countries to implement a suite of policies targeted at relieving pressures on the world's forests. Prominent among these are initiatives regulating commodity supply chains most responsible for climate change. This paper addresses the most ambitious of such initiatives to date, the European Union Deforestation-free Regulation (EUDR), which was formally adopted by the European Parliament on June 30, 2023. Drafters of EUDR suggest it can reduce annual emissions by 32 million tons of carbon, but calculations and achievement of these reductions are contingent on various factors. We provide a policy implementers view of EUDR's key issues and draw on experience from past regulations to highlight fundamental challenges and concerns. While much of current policy analysis focuses on geopolitics and bilateral trade tensions, EUDR's supporting infrastructure is getting underway and largely overlooked. The extent of its success rests on four key issues: 1) credible and equitable mechanisms in producer countries to ensure traceability of deforestation-free products, 2) more equitable trade terms, 3) internal EU cohesion, and 4) overcoming risks to the most vulnerable producers. How these issues unfold will also structure other ambitious emerging policies, such as the US FOREST Act and the UK Environment Act. [ABSTRACT FROM AUTHOR]

As an emerging economy, Turkey has experienced a significant structural transformation in the last twenty years. Within this period, Turkey has increased to the eleventh rank for international tourist arrivals in the world (UNWTO 2023). However, in recent years, there has been a rapid depreciation of the national currency, raising the question of how this affects the tourism trade. Using bilateral data and considering non-linearities, we investigate the exchange rate-tourism balance nexus for Turkey and its most tourist sender partners by applying ARDL and NARDL modelling. We find that (i) when the Turkish Lira (TL) appreciates, the tourism balance is positively affected in the German and UK models in the short-run and in the Russian and Netherlands models in the long-run; (ii) the depreciation of the TL, on the other hand, has a positive effect on the tourism balances for France and the UK in the short-run. Therefore, either the increase or decrease in the exchange rate (except for Russia in the short-run) affects the tourism balance insignificantly or positively. These findings imply that policymakers should focus more on country-specific tourism policies to attract more tourists to the country rather than on exchange rate policies to manage the tourism balance. [ABSTRACT FROM AUTHOR]

This paper examines the effect of bilateral air connectivity on bilateral service trade flows. Our service trade data includes 'commercial', 'transport', 'travel', and 'government' services. We developed a reduced-form gravity-type model using the Chinese data. An instrument variable (IV) approach is adopted to address the endogeneity issue between bilateral air connectivity and the service trade variables. Our key results are: (a) increasing the number of direct routes can significantly promote bilateral service export and import trades; (b) the average route-level traffic density has only marginal positive effects; (c) improving air connectivity would enlarge China's overall service trade deficit, because the transport and travel services imports are promoted more than their exports; (d) The 'commercial' service exports can be stimulated more than the imports, making China achieve larger commercial service trade surplus by improving bilateral air connectivity. •Increasing the number of direct air routes significantly promotes bilateral service trades in China. •Improving air connectivity enlarges China's overall service trade deficit. •Enhancing bilateral air connectivity stimulates China's commercial service exports more than imports. •China's growing international air transport, facilitated by the Belt-and-Road Initiative, has had a substantial impact on bilateral service trade. [ABSTRACT FROM AUTHOR]

This study applies a time-varying parameter/stochastic volatility vector autoregression (TVP-SV-VAR) model to explore the time-varying property of the link between Sino-US political relations and trade. The results indicate that the association of these two variables appears to be unstable. Sino-US political relations have positive and negative impacts on their bilateral trade, and the impact on Chinese imports is stronger than on its exports. In turn, Chinese imports from the US lead to political conflict, while Chinese exports promote peace. The interaction mechanism may originate from the expectations of the future trade environment caused by trade policy uncertainty. The interactions between Sino-US political relations and bilateral trade at different time points are also investigated. The results demonstrate that the link between these two variables is slightly different, depending on the specific status of the bilateral political relationship (friendly, neutral or hostile). Both China and the US should seek common interests to maintain a stable political relationship, and even with an increasing volume of bilateral trade, the risk of political conflicts should not be neglected. [ABSTRACT FROM AUTHOR]

In international economics, there has been a steady stream of innovations to explain patterns of trade between and among countries with emerging techniques. The most recent - Poisson Pseudo Maximum Likelihood (PPML) estimator - corrects for a potential bias caused by the large proportion of zero observations in bilateral trade data. Alternatively, this study offers Machine Learning (ML) as an option, especially in the presence of finer data on bilateral trade patterns. Using monthly and HS-6-digit (product) level data, the study finds that the main advantage of PPML is its accuracy of forecasts in-sample, but feature selection is somewhat rigid due to the inclusion of a large number of pair-wise fixed effects. ML models have the advantage in selecting features when a long list of explanatory variables is to be considered. Model validation statistics such as MAE and RMSE favor ML methods, but PPML tends to yield higher goodness of fit. In the out-ofsample context, ML has better accuracy than PPML, and a one-step walk-forward ML approach further improves the accuracy of ML forecasts. While PPML has a rich research and application history, emerging ML techniques have sufficient room for improvement in their adaptation to economic analysis. [ABSTRACT FROM AUTHOR]

• We assemble a new database of exports at constant prices for 131 countries. • Export growth of decolonised countries negatively related to metropole trade share. • Metropolitan trade shares are significant for post-independence French Africa. • British colonies significant before and after independence. • Colonial trade policy and location were important drivers of the metropole effect. Decolonisation was one of the most important institutional transformations of the twentieth century. Recent work on the effect of decolonisation on bilateral trade has suggested that trade with the ex-metropolis declined significantly after independence. Due to problems related to data quality and coverage, however, there is still no consensus on whether the reduction of colonial dependence encouraged or impeded export growth. In this paper, we argue that metropolitan trade shares proxy for colonial monopsony. Using a new database of exports at constant prices for 131 countries and mean group estimators that control for a range of confounding factors, we find that trade shares with the metropole are negatively associated with export growth, with important differences across metropolitan nationalities and locations. We argue that the significance of the erosion of colonial trade ties for export growth following independence was contingent on the interaction of policy and location during the colonial period. [ABSTRACT FROM AUTHOR]

Agriculture trade helps countries capitalize on the untapped benefits of their agro-climatic, geographic, and socio-economic endowments to maintain food security. Vegetables among the crops grown in Pakistan hold a key position. Despite the agricultural potential, Pakistan's vegetables have a negative trade balance. Since China is Pakistan’s largest trading partner offering a huge market, this study explores the potential trade opportunities in the vegetable sector between China and Pakistan aiming to overcome the trade deficit, and evaluates the trade specialization and competitiveness of vegetable products between China and Pakistan. We employed the Revealed Comparative Advantage index, Symmetric Revealed Comparative Advantage index, Imports Revealed Comparative Disadvantage, and Trade Complementarity index. Results indicated that China and Pakistan have a comparative advantage in vegetable trade, however, a notable distinction between the degree and products exhibit comparative advantage. China exports and Pakistan imports are highly complementary. Further, the studied indices revealed that some products are exactly the same. China has export comparative advantage while Pakistan has a comparative import disadvantage, indicating a potential trade gap. The results demonstrated that China Pakistan Free Trade Agreement positively impacts the two-sided vegetable trade. However, the potential of China Pakistan Economic Corridor (CPEC) is not fully exploited. Finally, suggestions were put forward to strengthen bilateral trade for mutual benefit. [ABSTRACT FROM AUTHOR]

In the context of global value chains (GVCs), the impact of the Belt and Road Initiative (BRI) on China's bilateral trade with Belt and Road countries (BRCs) is controversial. This study constructed a GVC accounting framework based on a multiregional input–output model, aiming to clarify the trends and transfer characteristics of the value added (VA) and the embodied carbon emissions (ECEs) in China–BRCs bilateral trade from 2000 to 2018 at the overall country, Belt and Road region (BRR), and typical country levels. The relevant results are threefold. (1) At the overall country level, the BRCs VA and ECEs imports and exports have shown overall increasing trends. (2) Most BRRs are net ECE exporters to China. Southeast Asia and Northeast Asia are the main ECEs destinations and sources. (3) In China–typical BRCs bilateral trade, China is a net ECEs exporter to most typical BRCs, and the net ECE transfers through route 1 (onefold value chain) are all positive, implying that route 1 can reduce ECEs in BRCs. These findings can help formulate policies and measures to reduce carbon emissions and provide a scientific basis for realizing the coordinated development of carbon emission reduction and economy in China and BRCs. [ABSTRACT FROM AUTHOR]

Normalization indicates that states have opened a new page in their bilateral relations, and while it does not cover some problematic areas in relations and does not offer a final solution, it serves to create a reasonable basis for dialogue. The concept of normalisation includes the capacity to transform not only the political but also the economic dimension of Turkish-Israeli relations. This article contends that before the normalisation process in the bilateral relationship, the economic and especially the commercial dimension of the relations remained at a certain level and maintained its strong position even during tense diplomatic and political periods. In this context, the article draws attention to the fact that the normalization of Israel-Turkey relations is an ongoing process and aims to indicate that despite the existence of some disagreements, the search for cooperation on specific issues of common interest may continue. [ABSTRACT FROM AUTHOR]

Turkey was the first Muslim state to recognise Israel in 1949. While Israeli-Turkish relations have been characterised by ups and downs, mainly due to the Palestinian issue, they reached an all-time low under the Justice and Development Party (AKP) rule. Yet, it was not until 2009 that bilateral relations started to deteriorate. Operation Cast Lead marked a turning point in bilateral relations, followed by a series of crisis: the 'One Minute crisis', the 'Lower Sofa crisis', and the Mavi Marmara flotilla crisis. With both sides' agreement to restore full diplomatic relations following Israel's President Isaac Herzog's visit to Turkey in March 2022, the normalisation process in bilateral relations gained pace, only to go into a swift decline yet again following the outbreak of the Gaza war in October 2023. This article analyses the focal events and dynamics that led to the deterioration and normalisation of bilateral relations under the AKP's rule. It shows that in addition to the Palestinian issue, the AKP's foreign policy vision and both states' divergent security interests created a conducive environment for the deterioration of bilateral relations. [ABSTRACT FROM AUTHOR]

While Turkey was the first Muslim majority state to recognise Israel, bilateral relations underwent many ups and downs in subsequent decades, peaking in the 1990s and experiencing a sharp deterioration since the mid-2000s that culminated in the Mavi Marmara flotilla crisis of 2010. This article examines Turkish-Israeli relations in the 2010s, known as the 'lost decade', with a special emphasis on whether this period constitutes a continuation of the declining relations or a new link in the relations between the two states. Indeed, the hesitant reconciliation process that began in March 2022 with the return of ambassadors and a series of fence-mending steps was brought to an abrupt end in October 2023 as Ankara threw its full weight behind Hamas in its war against Israel. [ABSTRACT FROM AUTHOR]

Turkish-Israeli relations have been marked by constant fluctuations for over half a century, yet they have never ebbed so low as in the era under the AKP (Justice and Development Party). A closer look at Turkish-Israeli relations since their inception shows that despite vital security and economic interests shared by the two states, bilateral relations are largely shaped by ideational factors, namely the evolution of Turkish state identity. This article investigates both the material and ideational factors in Turkish-Israeli relations in three periods: during the Cold War; from 1990 to the rise of the AKP in 2002; and during the AKP era. After examining the trajectory of the relationship over decades, the article, while not denying the centrality of material factors, suggests that there is a strong correlation between the evolution of Turkish state identity and Ankara's relations with Israel. [ABSTRACT FROM AUTHOR]

Turkish-Israeli relations, which achieved the level of strategic cooperation in the late 1990s, began to decline in the late 2000s, especially after Israel's 2008–9 Operation Cast Lead in Gaza. The existing literature enumerates several factors underlying the bilateral relationship but tends to overlook both states' perceived identities and self-images. Focusing on the identity factor, this article ascribes the deterioration of Turkish-Israeli relations to the major changes in Turkey's state identity during the years of AKP rule. By way of substantiating this argument, the article provides a brief overview of the literature on the role of state identity in international relations before exploring four case studies that exemplify the influence of state identity on Turkish-Israeli relations: the bilateral military cooperation agreement (1996); Operation Cast Lead and the attendant 'Davos incident' (2008–9); the Mavi Marmara crisis (2010); and the 'Arab Spring' of the early 2010s. [ABSTRACT FROM AUTHOR]

AbstractPartnership is a typical “Flag” of China’s foreign relations, playing a significant role in promoting bilateral trade. This study examines the impact and mechanism of China’s partnerships on trade with empirical evidence, revealing that establishing a partnership increases bilateral trade by 25%; each level-up of the partnership will lead to a 6.8% increase in bilateral trade, with a dynamic impact lasting about five years. Partnership building mainly impacts bilateral trade through political interaction, bilateral investment, and cultural exchange between two countries, with cultural exchange playing a dominant role in the mechanism. Strengthening partnerships with Asia-Pacific, Latin America, African countries, low-income, and low trade size countries can create more potent bilateral trade effects. Furthermore, higher levels of partnership have an exemplary effect, bringing a positive spatial spillover effect on trade. This study affirms the significant role of partnership in foreign relations and trade, providing valuable insights to reduce trade risk and achieve high-quality development. [ABSTRACT FROM AUTHOR]

This research builds upon theoretical assumptions regarding the relationship between openness to international trade and corruption. It seeks to answer the question of whether it matters for Africa with whom it trades. Specifically, our goal is to estimate and compare the impacts of Africa's trade with two key entities: the European Union (EU), its traditional primary trading partner whose share in Africa's bilateral trade has recently declined, and China, its emerging trading partner whose share in Africa's bilateral trade has been steadily increasing. This assessment will be focused on impacts on corruption. Our research utilizes a panel dataset comprising twenty-eight African countries for the period spanning from 2002 to 2016. We employ regression models including pooled OLS, fixed effects, and random effects, drawing upon data from the International Trade Centre, International Country Risk Guide, and the World Bank. Our findings suggest a weak but positive correlation between Africa's rising trade activity and corruption. However, this correlation is more pronounced in the case of trade with the EU, where the impact is estimated as positive, as opposed to trade with China, where it is estimated as negative. Additionally, while higher natural resources rents tend to have a negative impact on corruption in Africa, our results indicate that this is not the case of rents derived from trade with the EU. [ABSTRACT FROM AUTHOR]

The integration of renewable rnergy sources (RESs) into the power grid involves operational challenges due to the inherent RES energy-production variability. Imbalances between actual power generation and scheduled production can lead to grid instability and revenue loss for RES operators and aggregators. To address this risk, in this paper, we introduce a mutually beneficial bilateral trading scheme between a RES and a DR aggregator to internally offset real-time energy imbalances before resorting to the flexibility market. We consider that the DR aggregator manages the energy demand of users, characterized by uncertainty in their participation in DR events and thus the actual provision of flexibility, subject to their offered monetary incentives. Given that the RES aggregator faces penalties according to dual pricing for positive or negative imbalances, we develop an optimization framework to achieve the required flexibility while addressing the trade-off between maximizing the profit of the RES and DR aggregators and appropriately incentivizing the users. By using appropriate parameterization of the solution, the achievable revenue for the imbalance offsetting can be shared between the RES and the DR aggregators while keeping users satisfied. Our analysis highlights the interdependencies of the demand–production energy imbalance on user characteristics and the RES and DR aggregator profits. Based on our results, we show that a win–win outcome (for the RES and DR aggregators and the users) is possible for a wide range of cases, and we provide guidelines so that such bilateral agreements between RES and DR aggregators could emerge in practical settings. [ABSTRACT FROM AUTHOR]

This article explores Russia's influence in Africa, which poses a significant challenge to the West. In recent years, Moscow has gained momentum on the continent, becoming a formidable rival to Western powers. It has formed strategic alliances with key African nations, solidifying its foothold. Many African countries now see Russia as an alternative to Western partners. To establish this influence, Moscow prioritises military and economic partnerships, offering trade, investments and security assistance in exchange for political support. The West has been slow to respond, either preoccupied with domestic issues or disengaged from Africa, allowing Russia to gain the upper hand. The implications of Russia's African influence are far-reaching, posing a significant challenge to Western interests. This situation could escalate geopolitical tensions and potentially lead to conflict with the West. We aim to explore Russia's motives and its impacts on African nations, shedding light on how they affect Western interests. [ABSTRACT FROM AUTHOR]

In this paper, the stochastic frontier gravity model is applied to analyze the trade potential between China and Nepal and the prospects of Lanzhou-Kathmandu South Asian rail-road freight trains (LKSARFT). Based on the statistical data, we test the Exports Efficiency (EE), Bilateral Trade Efficiency (BTE), Exports Trade Potential (ETP), Bilateral Trade Potential (BTP), Extended Exports Trade Potential (EETP), Extended Bilateral Trade Potential (EBTP), Improved Exports Trade Potential (IETP) and Improved Bilateral Trade Potential (IBTP) between China and Nepal, the following analysis results can be found: for the bilateral trade model, the bilateral non-efficiency factor decreasing at a rate of 0.057 with time increasing, bilateral trade increasing at a rate of 0.057 with time increasing. For the exports model, the exports non-efficiency factor increasing at a rate of 0.004 with time increasing, exports trade decreasing at a rate of 0.057 with time increasing. The BTE between China and Nepal increases when time changes, the EE from China to Nepal remains constant changing during the 18 years. The changing range of BTE is 0.002–0.05; the changing range of EE from China to Nepal is over 0.1, larger than the BTE. The BTE and EE ranking among the eight South Asian countries are ranking fifth and fourth during the 18 years. exports trade resistance from China to Nepal is larger than bilateral trade resistance; The import trade potential from Nepal to China is huge, the focus of bilateral trade between China and Nepal may be changed, there are more goods may be exported from Nepal to China, and China may become trade deficit when trading with Nepal. Then, the development bottlenecks of the LKSARFT are analyzed. Finally, we give policy directions to boost bilateral trade efficiency and tap the potential of bilateral trade between China and Nepal. [ABSTRACT FROM AUTHOR]

In international economics, there has been a steady stream of innovations to explain patterns of trade between and among countries with emerging techniques. The most recent - Poisson Pseudo Maximum Likelihood (PPML) estimator -- corrects for a potential bias caused by the large proportion of zero observations in bilateral trade data. Alternatively, this study offers Machine Learning (ML) as an option, especially in the presence of finer data on bilateral trade patterns. Using monthly and HS-6-digit (product) level data, the study finds that the main advantage of PPML is its accuracy of forecasts in-sample, but feature selection is somewhat rigid due to the inclusion of a large number of pair-wise fixed effects. ML models have the advantage in selecting features when a long list of explanatory variables is to be considered. Model validation statistics such as MAE and RMSE favor ML methods, but PPML tends to yield higher goodness of fit. In the out-of-sample context, ML has better accuracy than PPML, and a one-step walk-forward ML approach further improves the accuracy of ML forecasts. While PPML has a rich research and application history, emerging ML techniques have sufficient room for improvement in their adaptation to economic analysis. [ABSTRACT FROM AUTHOR]

This study analyzes the effects of cultural, religious, and linguistic differences on bilateral trade. We conceptualize these differences as cultural distance, religious distance, religious denominations difference, language diversity, and linguistic distance. We collect trade data for more than 50 countries over ten consecutive years and build an augmented gravity model. The empirical analysis reveals that language diversity impedes trade, but variations in cultural distance and religiosity tend to facilitate bilateral trade. The findings suggest that cultural and religious dissimilarities between partners are not necessarily detrimental to international trade as some differences in culture and religiosity can promote international trade. [ABSTRACT FROM AUTHOR]

The Southern African Customs Union (SACU) is a prominent economic association of the African continent. SACU comprises five southern African countries: South Africa, Botswana, Namibia, Lesotho, and Eswatini. The overall value of India's trade with SACU increased from $1,477.52 million in 2001 to $1,0941.24 million in 2020, an almost sixfold increase. The export increased almost tenfold between 2001 and 2020, from US$ 343.49 million to US$ 3,760.94 million. In order to increase India's trade with SACU, the Indian-SACU PTA negotiations are now ongoing. This article examines India's export potential to SACU nations using the revealed comparative advantage index, the revealed import dependency index, and the Potential bilateral trade equation. The study shows India has trade potential with all SACU member states. Still, it has only utilised this potential with South Africa. India has not taken advantage of the vast potential of exporting its goods to SACU countries except South Africa. The trade intensity index indicates that India's export and import intensities with SACU have increased over time. [ABSTRACT FROM AUTHOR]

This article aims to analyze the Turkish foreign policy towards the African continent in the 21st century. With the end of the Cold War and the world order centered on a bipolar logic, Turkey has had greater autonomy to manage its international relations, maintaining a more active foreign policy by expanding its economic, diplomatic, and security affairs beyond the West. In this context, under the leadership of the Justice and Development Party (AKP), the African continent has come to occupy an increasingly prominent place in Turkish foreign relations. Thus, since the early 2000s, there has been a substantial increase in Turkey's presence on the continent, characterized, among other aspects, by the intensification of bilateral trade flows, the expansion of the diplomatic network on the continent, its participation in the mediation of conflicts and the offer of humanitarian assistance to African actors. In this context, and based on the literature on Middle Powers and Regional Powers, this paper discusses the intensification of Turkey's ties with African countries since the beginning of the 21st century, comprehending it as part of a broader international projection strategy. To this end, the study adopts a hermeneutic approach, relying on the literature review on Turkish-African relations and the analysis, supported by quantitative data, of the developments of these relations in the political, economic, and security axes throughout the period in question. [ABSTRACT FROM AUTHOR]

Purpose: Oil price shocks greatly impact the global economy, but the effects vary among countries. While higher oil prices benefit oil-exporting countries, they harm the economic performance of oil-importing nations, and vice versa for lower oil prices. However, economic relations, such as trade, can mitigate the impacts of oil price shocks on both groups. In this paper, the authors aim at estimating the effects of oil price shocks on the major net oil-exporting and net oil-importing countries while accounting for international trade. Design/methodology/approach: The authors derive a reduced form of a macro model and set up a Panel VAR model to estimate the direct and indirect impacts of oil price shocks on economic growth. The sample includes data on macroeconomic variables from 30 oil-exporting and oil-importing countries that comprise more than 73 percent of the world's economy. The authors construct the spillover variables using bilateral trade matrix. To control for institutional and structural variations across the countries, they are divided into four groups of developed and developing oil-exporting and oil-importing countries. Findings: The results reveal that all oil-exporting countries have significantly benefited from oil price shocks, although trade has dampened the effect. The positive growth effect has been more pronounced in oil-exporting developing countries. The impact of oil price shocks on oil-importing countries has been negative with a one-year delay, but not statistically significant, and trade has only had a small effect. The effect has been more substantial in oil-importing developing countries. Research limitations/implications: One of the limitations of this study is the focus on trade as the main spillover channel. Given the data availability, other channels such as foreign investment and financial markets can also be included in future studies. Practical implications: Removing trade restrictions would help both oil-exporting and oil-importing countries to mitigate the negative impacts of the oil price shocks. However, the asymmetric oil-macroeconomy relationship across oil-exporting and oil-importing countries puts oil-exporting countries in a more vulnerable position as they cannot rely on trade with oil-importing countries to reduce the negative impacts of lower oil prices on their growth. Therefore, it is crucial for oil-exporting countries to reassess their oil-dependent development plans and invest their oil revenues in non-oil sectors to diversity their economies and prepare for a future with reduced dependence on oil. Social implications: The recent technological advances, structural changes, and increasing energy efficiency suggest that major oil-importing countries will become less dependent on oil in near future. As a result, oil-exporting countries will also need to undergo structural changes in order to sustain their income level. These significant changes will have important social implications, particularly in the labor market, during the transition, for which preparation will be necessary. Originality/value: While the literature on the total impact of oil price shocks on either oil-exporting or oil-importing countries is rich, studies on their spillover impacts are limited. Recent research has shown that trade and migration can affect the impact of oil price shock on the economy in federated countries such as Canada. However, the trade effect on oil price shocks in the international level, where countries are subject to different regulations/restrictions and institutional variations, remains scarce. By considering the trade relationship between different groups of oil-exporting and oil-importing countries, the authors aim to contribute to the literature of the global impacts of oil price shocks on the world economy. [ABSTRACT FROM AUTHOR]

Purpose – This study examines the impact of regional economic integration (REI) on stock market linkages in the BRICS (Brazil, Russia, India, China and South Africa) economic bloc. In this type of study, the BRICS framework is an appealing empirical case, given its uncommon characteristics. For example, BRICS member states come from remote geographic locations (Africa, Asia, Europe and South America) and have contrasting socioeconomic profiles. Design/methodology/approach – An empirical design is framed from the perspective of bilateral trade between South Africa and BRIC. The author accepts trade intensity as a proxy of regional economic integration and then examines the resulting effect on the stock market co-movement within BRIC. The study applies a two-step econometric procedure of the BEKK-MGARCH and panel data models. Findings – Overall, bilateral trade, as a proxy of economic inwctegration, is associated with an increase in stock market integration. This positive relationship is particularly observed during episodes of surplus trade, and more interestingly, was initiated three years after BRICS’ existence and continues to grow at an increasing rate. Practical implications – The study outcome should benefit international trade practitioners and global investors interested in portfolio diversification or concerned with risk spillovers. Originality/value – First, notwithstanding South Africa’s significant economic presence in the African continent, to the best of the author’s knowledge, this is the first study to empirically evaluate the BRICS economic integration on their stock market linkages from the perspective of South Africa. The value of this contribution is that further work may investigate the bidirectional spillover impact conveyed by South Africa’s trade interactions within the juxtaposition of Africa and BRICS economies. Second, given that research on REI and stock market integration has historically concentrated on mature regional blocs of Europe, Asia, South and North America, the current study advances knowledge while correcting the prevailing literature imbalance. [ABSTRACT FROM AUTHOR]

This paper analyzes intra‐Common Market for Eastern and Southern Africa (COMESA) trade in services by establishing its determinants and exploring the role of trade facilitation on the same. The study relies on the Poisson Pseudo Maximum Likelihood (PPML) estimator of the gravity model on bilateral services trade data for total services and eight categories of services in 17 COMESA countries from 2005 to 2019. Results reveal that several factors determine intra‐COMESA services trade, the salient ones being GDP (exporter's and importer's), distance, contiguity, and time zone differences. Trading under a service‐specific trade agreement affects a few services: transport and other business services exports. The effect is positive for transport services and negative for other business services exports. Trade facilitation measures, especially broadband technologies, significantly improve services trade across various sectors. A key policy implication of our results is that service trade is more likely to grow through digital, information, and communication infrastructure development. Thus, policy should prioritize increasing access and usage of broadband technologies. [ABSTRACT FROM AUTHOR]

This study investigates the impact of information and communication technology (ICT) on bilateral trade flows, focusing on intermediate inputs across 161 countries from 1990 to 2016. We utilize the Eora global supply chain input-output tables to distinguish trade in intermediate inputs from gross trade. By adopting the Poisson pseudo-maximum likelihood (PPML) estimator, we find that ICT promotes bilateral and intermediate input trade by lowering trade costs. Notably, the similarity in ICT development between home and host countries is positively associated with bilateral intermediate input trade. Furthermore, the positive effects of ICT on bilateral intermediate input trade are stronger in labor-abundant countries than in capital-abundant countries. We also find that the positive relationship becomes more significant in low-income countries than in high-income ones. Labor-abundant and low-income countries are expected to experience an increase in intermediate input trade through ICT development. [ABSTRACT FROM AUTHOR]

Purpose: This paper explores the empirical relationship between population age structure and bilateral trade. Design/methodology/approach: The author includes age structure in both log and Poisson pseudo-maximum likelihood (PPML) formulations of the gravity equation of trade. The author studies relative age effects, using differences in the demographic structure of each country-pair. Findings: The author finds that a relatively larger share of population in working age increases bilateral exports. This is robust to various estimation models, as well as to changes in the method of specifying the demographic controls. Old-age shares have a negative, but less robustly estimated impact on trade. Estimating instead the balance of trade between trading partners produces similar results, with positive effects of age structure peaking later in working life. Practical implications: Global populations are poised to undergo a massive transition. Trade a crucial way that the demographic deficits of one country may be offset by the dividends of another as comparative advantages shift along with the size and strength of their underlying workforce. Originality/value: The author's work is among the first to quantify the effect of relative age structure between two countries and their bilateral trade flows. Focusing on the aggregate flows, relative age shares and PPML estimates of the trade relationship, this paper provides the most comprehensive picture to date on how age structure affects trade. [ABSTRACT FROM AUTHOR]

This paper explains the circumstances where economic growth increases the likelihood of interstate war. Optimism created by high and sustained economic expansion permeates a state, increasing elite and mass optimism for the use of deadly force. Without relief, such unbridled sanguinity can lead states to war. However, other forces reduce the probability of war. Regional democracy, bilateral trade, and trade openness slow down the process where states go to war. This paper hypothesizes that key factors raise the temperature of disputes, increasing the likelihood of a political dispute combusting to war, while other attributes inhibit the process to war. Economic growth catalyzes such reactions, while regional and joint democracy impede the probability that a war sparks. This paper produces monadic and dyadic results demonstrating that economic growth increases the likelihood of war, while other factors such as interstate trade openness, bilateral trade, dyadic democracy, and regional democracy slow down the process of war, making war less likely. [ABSTRACT FROM AUTHOR]

We study the optimality of allowing the designer to withhold or damage resources in Bayesian incentive compatible mechanisms for bilateral trade with independent private values. The following results hold when the buyer and the seller have discrete value distributions. Burning money or withholding the good from both traders never enhances welfare. Similarly, damaging the good for the buyer cannot increase welfare. By contrast, damaging the good for the seller may improve welfare. However, such welfare improvements are possible only if the damage hurts some lower valuation type of seller more severely than the highest valuation type. Results extend to the case of continuous value distributions under certain hypotheses regarding virtual values. Methods also apply to optimal Bayesian implementation for allocation problems. In the absence of property rights, damaging goods for any agent has negative welfare consequences. [ABSTRACT FROM AUTHOR]

This paper analyzes the impact of the Chile-South Korea Free Trade Agreement (CKFTA) over the bilateral extensive and intensive margins of trade. Using disaggregated product-level data for the period 1996-2017, the paper tests the impact of CKFTA on bilateral flows, as well as differentiate these effects between intensive and extensive margins at the product level. To estimate, a Poisson-Pseudo Maximum Likelihood model is proposed. It is found that the CKFTA had a positive effect over bilateral trade flows, and although new products were added to the bilateral export basket (extensive margin), the impact is stronger on goods already traded (intensive margin). Moreover, the paper concludes that this effect is stronger for Chilean exports. [ABSTRACT FROM AUTHOR]

Trade among neighboring nations holds significant economic importance, influencing the socio-economic development of countries. India and Pakistan represent one of the most persistent conflicts in contemporary international relations. The continuation of this conflict poses significant challenges to the establishment and nurturing of robust economic ties between the two nations. Deep-rooted historical animosity between neighboring nations often adversely affects regional economic relations, leading to noticeable disruption and disparities in trade patterns. This study focuses on examining the impact of geopolitical dynamics on trade relations between India and Pakistan. Bilateral trade relations between the two countries have been examined in three distinct time periods: 1965–2011, 2011–2016, and 2016 onwards. The findings revealed that whenever there were hostile relations between the two countries, their trade relations were also adversely affected. Furthermore, it is recommended that emphasizing the importance of peaceful relations is crucial for fostering bilateral trade between the two countries. [ABSTRACT FROM AUTHOR]