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Evidence that local exposure to Chinese import competition favors right-wing parties has often been attributed to the success of economic nationalism. We test an alternative account. Trade shocks catalyze cultural backlash, which drives support for conservative candidates, as they compete electorally by targeting out-groups. We assess this hypothesis in the 2008–2016 US presidential elections. Using individual-level survey data, we provide evidence that Chinese import shocks drive negative attitudes towards minorities and positive feelings towards in-groups. Opinions about free trade and redistribution are not affected. Results indicate that this rightward shift is primarily driven by non-Hispanic white and male respondents. These findings point to the role played by trade-induced cultural backlash in shaping political outcomes in the US. [ABSTRACT FROM AUTHOR]

Human capital and trade liberalization are playing a central role in growth theories. However, the link between human capital, trade liberalization, and economic growth remains a challenging question due to the inconclusive results of the previous studies. Paper contributes to this debate through asymmetric links among human capital, trade liberalization, and economic growth by incorporating labor and capital for Pakistan's economy by applying the nonlinear autoregressive distributed lag model. Results suggest that the positive and negative asymmetric impact of trade liberalization and human capital on growth substantially vary in the short and long run. In the long run, the increased trade liberalization hurts economic growth, while increased human capital has a minimal positive impact on economic growth in the short and long run. The implications of this paper are for economists and policymakers to strengthen the role of human capital and trade liberalization for Pakistan. [ABSTRACT FROM AUTHOR]

This article estimates the total factor productivity (TFP) growth of Chinese manufacturing firms and quantifies how international sourcing and trade liberalization affect TFP growth. To this end, we estimate stochastic frontier production that decomposes TFP growth into technical changes, returns to scale, and technical efficiency changes. Furthermore, we consider two channels through which external factors affect TFP growth: technical change and technical efficiency change components. We measure international sourcing and trade liberalization by foreign value-added shares and input tariffs, respectively. Several novel findings emerge. First, international sourcing and import tariff reduction positively impact TFP growth by improving technical changes and technical efficiency. Second, international sourcing has a negative effect on the technical changes of processing importers, while it has positive effects on the technical change and technical efficiency change of ordinary importers. Third, input tariff reduction has a substantial and positive impact on the technical efficiency change of processing importers and the technical change of ordinary importers. [ABSTRACT FROM AUTHOR]

This paper examines third-party trade and its implications for conflicts between hostile countries not engaging in trade. We present a conflict-theoretic model to analyze two adversaries' endogenous arming decisions when they separately establish a free trade agreement (FTA) with a neutral third-party state. We contrast this multiple FTAs regime with a single FTA regime between one adversary and the third-party state, which excludes the other adversary as a non-member. In our analysis, the benchmark case is a protectionist regime when the bilateral trade between the third-party state and each of the adversaries is a tariff war. Among the three trade regimes, we show that the two adversaries' aggregate arming is the lowest under multiple FTAs but is the highest under a single FTA. These results suggest that, despite no trade between two adversary countries, multiple FTAs through third-party trade have the pacifying or appeasing effect of lowering overall military buildups in interstate conflicts. [ABSTRACT FROM AUTHOR]

This paper provides an evaluation of the main characteristics of Chinese domestic cultural policy and international cultural trade strategy. The objective is to assess whether China has developed a type of pattern addressing the culture and trade issue, and to advance meaningful lessons to reconcile cultural diversity and trade liberalization in the context of international law. This paper starts with a brief introduction of Chinese cultural industries and Chinese cultural laws and policies. The analysis then dives into Chinese international agreements, including WTO agreements, the UNESCO Convention 2005, Chinese FTAs, and the BRI. Chinese international cultural practices can be grouped into cultural trade liberalization commitments and cultural cooperation mechanisms. This paper argues that China takes a cautious attitude towards liberalizing cultural trade while holding a relatively open position towards promoting cultural cooperation. The cultural cooperation approach deserves more attention as an alternative route for reconciling cultural diversity and free trade in international law. [ABSTRACT FROM AUTHOR]

This study identifies cross-country and intertemporal differences in the effects of trade exposure on per capita national income. We develop a small open economy endogenous growth model with high- and low-technology sectors and endogenous human capital accumulation. We then test the predictions of our model on a sample of 70 countries over the period 1980–2017. Our main assertion is that gains from trade are not only disproportionate across countries but also contrasting over time, depending on the technology intensity of exports. Countries with lower initial experience in the production of technology-intensive goods and services tend to specialize in sectors with lower demand for better-educated and high-skilled workforce, which lowers the return to and individual incentives for education. Consequently, trade-induced specialization patterns, due to their implications about technological progress, appear to be an important factor causing cross-national divergence in welfare. Our theoretical model implies that, in an unskilled labor-abundant country, higher exposure to international trade can decrease the long-run growth rate, even though it increases short-run per capita income. In a skilled-labor abundant country, both short-run and long-run effects are positive. Our empirical findings, which identify short-run and long-run effects separately, strongly support these predictions. [ABSTRACT FROM AUTHOR]

In this paper, we assess the forecasting performance of three types of structural models – DSGE, BVAR with Minnesota priors, and DSGE-BVAR – in the context of a commodity-exporting small open developing economy using the data for Kazakhstan. We find that BVAR and DSGE-BVAR models generally produce point forecasts that are more accurate and less biased compared to those of DSGE in the short term, but that BVAR forecasts rapidly deteriorate in quality as the length of the forecast horizon increases. The density forecast analysis shows that when all variables are jointly considered, the models have similar prediction accuracy, and when financial sector variables are omitted, the BVAR and DSGE-BVAR models demonstrate superior performance in the short term. [ABSTRACT FROM AUTHOR]

Recent empirical studies find that the magnitudes of reductions in bilateral shipping costs are asymmetric within country pairs. Motivated by these findings, I study the welfare effects of asymmetric reductions in transportation costs in Helpman and Itskhoki's [(2010). Labour market rigidities, trade and unemployment. Review of Economic Studies, 77(3), 1100–1137] model of international trade with heterogeneous firms and frictional labor markets. I show that sufficiently asymmetric reductions in bilateral transportation costs result in welfare losses in the importing country, while a uniform reduction in the bilateral transportation costs of both imports and exports always benefits both countries. This paper raises a cautionary note that the phrase 'welfare gains from trade liberalization' implicitly assumes an 'approximately equal' reduction in transportation costs. [ABSTRACT FROM AUTHOR]

This article is part of a series to document the voices and perspectives of La Via Campesina leaders for the 50th Anniversary of the Journal of Peasant Studies and the 30th Anniversary of La Via Campesina. Yoon Geum Soon reflects on Korean women peasant organizing from the local to international level. She discusses the resistance to international trade regimes, organizing strategies rooted in women peasants' daily lives, and the history and trajectory of peasant movements in Korea. [ABSTRACT FROM AUTHOR]

Since international trade is developing rapidly and the world is facing serious problem of energy shortages, this paper focuses on analyzing if export liberalization can help to improve the country's energy efficiency. In this paper, we establish the theoretical trade model at micro-level and study how export liberalization affects energy use performance of the firm. Then, we employ data of Chinese exporters to conduct empirical analysis. Our results suggest export liberalization can improve energy use performance of the firm, which shows that export liberalization has positive effects on firm's energy use performance. The results of mechanism test suggest that export liberalization can improve firms' productivity and increase firms' innovation ability, which can further help to increase firms' energy use efficiency. Altogether, this paper gives evidence on the effects of export liberalization on energy use performance, which reveals the importance of trade liberalization in solving the global energy problems. [ABSTRACT FROM AUTHOR]

The Greater Arab Free Trade Agreement (GAFTA) is a regional trade agreement among the Arab countries. We incorporate recent advances in the literature to investigate the partial and general equilibrium effects of GAFTA. The partial equilibrium estimates suggest that GAFTA had a positive and significant effect on bilateral trade of around 40% in 1998 and 61% after the phasing out of tariffs. The general equilibrium analysis suggests that the welfare effects of the agreement are mostly negligible. The results highlight that deeper integration among the Arab countries is imperative to bring about further welfare benefits to the member states. [ABSTRACT FROM AUTHOR]

Why would some legislators alter their votes on trade agreements in return for environmental side agreements that may be hard to enforce? While numerous studies have examined the effects of side agreements, few have evaluated their impact on legislators' positions on a trade agreement over time. This paper examines the effects of the environmental side deal attached to NAFTA, with novel time-series survey data that captures the evolution of House members' positions on NAFTA during discussion and finalization of the environmental side of the free trade agreement. I find that pro-environmental legislators in safe districts tended to withdraw their support for NAFTA once the side deal was agreed upon, whereas those in competitive districts stood their ground and increased their support in the final stage of voting. Contrary to the conventional wisdom, I find little evidence that the side deal assuaged legislators in import-competing districts. This article shows how the effectiveness of international institutions is moderated in important ways by electoral considerations. [ABSTRACT FROM AUTHOR]

Gravity variables such as distance, adjacency, colony, free trade agreements or language are used to capture the effects of trade costs in empirical studies. By using actual data on trade costs, this paper decomposes the overall effects of such variables on trade into those through three gravity channels: duties/tariffs (DC), transportation-costs (TC), and dyadic-preferences (PC). As opposed to the existing literature where gravity variables act like supply shifters (through DC and TC), this paper empirically shows that they act like demand shifters (through PC). Regarding policy, it is implied that welfare-improving globalization cannot be achieved only through reductions in direct costs such as duties/tariffs or transportation costs; it is rather the globalization itself that should be promoted in order to shift the preferences of destination countries toward international products and thus reduce indirect trade costs. The results are further connected to several existing discussions in the literature, such as welfare gains from trade and the distance puzzle. [ABSTRACT FROM AUTHOR]

The article focuses on the European Union's commitment to free trade and how it has shaped its external policy. It highlights the assumption that the EU's market power in the international system would allow it to extend its unique model of capitalist development to less developed and less market-oriented trading partners. It also explores the risks stemming from strategic dependencies and the need for the EU to calibrate its trade dependencies.

Mexico has one of the largest networks of trade and investment agreements in the world. However, the legal architecture in Mexico does not allow sub-federal governments (SGFs) to participate in free trade negotiations. While this explains the rather weak role of Mexican sub-federal units in trade politics, this case study shows that the states are not absent from trade. They utilize semi-formal and informal resources which account for variation in trade engagement. Permissive secondary legislation, cooperation agreements and projects, and intergovernmental bargaining are all institutional resources used by Mexican SFGs to engage in trade politics. These resources function under supportive conditions that facilitate trade, such as interest identification, institutional capacities, and learning processes. A variation of such conditions sets the basis for the use of certain resources. This article presents empirical evidence of SFGs differentiated engagement in the United States-Mexico-Canada agreement (USMCA) and the revamped Mexico-European Union trade agreement (MEX-EU). [ABSTRACT FROM AUTHOR]

This article examines the emerging infrastructure and market for automobiles in Vietnam as it transitions from a long history of motorbike mobility following Đổi Mới market renovation and peaking after the country's accession to the World Trade Organization. Considering the context of recent free trade Agreements including the ASEAN Free Trade Area that are opening Vietnam's markets to automobile imports and causing Vietnamese domestic car manufacturers to reconsider their production and marketing strategies, I argue that anticipations of impending transportation and mobility transformations are being undertaken on multiple yet intersecting levels. Understanding these intersections through the lens of stakeholder knowledges, projections and affects – ranging from those of potential automobile consumers to specialists and strategists laboring in future mobility and automotive design labs, offers insight into the agencies and contingencies of actors and actants participating within infrastructural networks that are reshaping mobility behaviors and options. Interventions to recuperate and connect the often atomized agents within modal mobility production assemblages will be critical to influence the infrastructural contours of transportation development in emerging markets like Vietnam, and promote a sustainability model that goes beyond technological innovation and upgrade consumption. [ABSTRACT FROM AUTHOR]

Asian's gross domestic product (GDP) will reach 52% of the world's entire GDP in 2050,[13] and China's share of global GDP jumped from 3.05% in 2000, to 13.68% in 2010, and then 18.33% in 2020.[14] China's Belt and Road Initiative (BRI) was introduced by President Xi Jinping in 2013 during his visits to Kazakhstan and Indonesia. Instead, by examining the case of the Benban solar plant in Egypt, they discuss whether Chinese renewable energy investments in the region should be read within the wider global political economy of decarbonization, or as an element of China's geostrategic positioning in the Eastern Mediterranean. This special issue examines the increasing engagement of Asian countries in the Eastern Mediterranean. Taking China's BRI as opportunities for Greece and Cyprus as an example, more and more Eastern Mediterranean countries believe China is a balancing factor that supports their economic problems and geopolitical struggles. [Extracted from the article]

Renowned for his espousal of early liberal internationalist principles, free trade, and the pursuit of peaceful reconciliation, the British industrialist Richard Cobden (1804-1865) first put forward ideas related to freer trade between Britain and France, as well as nonmilitary interventionism in European wars that were promulgated by Russia, leading to the onset of the Crimean War in 1853, and eventually, after Cobden's death to the onset of World War I in Europe. Cobden's principles significantly contributed to peaceful interactions among state actors in the late 19th century, despite the Crimean war. His radical notions can be usefully contextualized, and may relate to future peaceful reconciliation, in this century, between Russia and the West, possibly after "the guns go silent" in Ukraine. Similarly to the 1840s, idealistic principles, as opposed to militaristic and jingoistic attitudes among the Europeans and British in the 1840s, may be inculcated, based in part on Cobden's idealism, including encouraging more peaceful connections among adversaries through freer trade. The political prescriptions of Cobden, before and after the Crimean War in 1853, can guide reflective perspectives among peace researchers, historians, and peace activists today, assisting processes that could move hitherto warring states toward more peaceful interactions and eventual reconciliation. [ABSTRACT FROM AUTHOR]

The market fundamentalist logic underpinning WTO agricultural trade rules poses a profound threat to global food security in the context of climate change. The growing frequency of extreme weather events raises the prospect of large-scale disruption of agricultural production and distribution. A trading system oriented towards maximizing economic efficiency and reducing redundancy risks leaving the world population acutely vulnerable to food supply disruptions. Ensuring the resilience of global food systems will require considerably more, rather than less, state intervention in agricultural and food production, including cultivating agricultural surpluses to protect against supply shocks. [ABSTRACT FROM AUTHOR]

The main aim of this study was to examine the effect of financial development on Ethiopia's export diversification by applying annual time series data from the period 1980 to 2019. An ARDL estimation technique was employed. In the short run financial development, external debt, and real gross domestic product have a positive significant effect on export diversification. The coefficient of the error correction model is −0.7168 or 71.68% and it is statistically significant that a deviation from long-run equilibrium is not persistent rather it adjusts towards equilibrium at a speed of 71.68% per year. In the long run financial development, trade liberalization, external debt, and real gross domestic product have a positive significant effect on export performance and the bound test confirms the presence of long-run co-integration between variables. It is recommended that government and the national bank of Ethiopia can adjust both saving and lending interest rate policies, providing sufficient loan to export industries that diversify and shifts towards the export of manufactured goods would be indispensable, keeping track of international exchange rate adjustment, liberalization of external trade is crucial and the government of Ethiopia should allocate the borrowed money into high return investment and import substitute goods. [ABSTRACT FROM AUTHOR]

Japan signed Economic Partnership Agreements (EPAs) with Indonesia, the Philippines and Vietnam in 2008, 2009 and 2014 respectively, each of which includes a scheme that encourages the movement of healthcare workers into Japan. This scheme has remained a subject of intense scrutiny as a model of continuous employment of migrant workers from Southeast Asia. Applicants are required to complete one year of Japanese language training prior to working at the host institutions, and are expected to sit the Japanese-language healthcare licensure examination within three to four years of their arrival in Japan. This article examines the policy discourse of language learning practices and environments, which are important parameters for ensuring participants' ongoing employment under this programme. The major finding is that the excessive promotion of self-learning among migrant workers correlates with a lower level of support from host institutions for their language learning. I argue that the Japanese government has shifted the responsibility for resultant negative consequences – such as the institutional burden of on-the-job training and the low exam pass rate – to the migrant workers by encouraging linguistic entrepreneurship. [ABSTRACT FROM AUTHOR]

While scholars have disclosed the pre-1870 intercontinental market integration between Europe and Asia, the contemporaneous intra-Asian international market has been assumed fragmentary. Contrary to this prevailing view, this study demonstrates that Southeast Asia's international rice market was in a process of integration from the 1830s onwards, with a dynamic shift in market linkages and efficiency via Singapore. Specifically, an estimation of coefficient of variation demonstrates long-run price convergence in Java, Singapore, and Southern China from the 1830s until 1872. Moreover, according to temporal variations of transaction costs and adjustment speed estimated using a Threshold Autoregressive model, direct market integration between Java and China shifted to indirect integration based on Singapore's intermediary function after the mid-1840s; market efficiency steadily improved through speedier information transmission while adapting to changing market linkages. This study suggests that rather than Western-led trade liberalizations, Singapore's entrepôt function significantly contributed to the post-1830s progress of Southeast Asia's rice market integration. [ABSTRACT FROM AUTHOR]

The present study empirically analyses the sector-wise private investment behaviour in Pakistan using the autoregressive distributed lag model from 1964 to 2015. The results indicate that credit availability and infrastructural development considerably affect private investment in agriculture, industry, and services. However, the user cost of capital does not have any influence on investment. The response of investment demand to credit availability is inelastic (i.e. 0.259) for agriculture but relatively higher for the industrial sector with a magnitude of 0.554. However, its value is slightly higher than the unit elastic value (1.059) in services. Fertiliser use positively impacts investment in agriculture, which is negatively affected by access to water. The values of the corresponding coefficients are 0.726 and −2.731, respectively. Remittances and foreign direct investment positively contribute to private investment in services. Openness significantly demotes private investment in services, and its magnitude is relatively high (−5.127). The findings signify and implicate the role of water availability, government support, and financial development in the agricultural sector. However, a stable political environment and cost of investment are very important for investment activities in the industry. Nevertheless, the role of openness in investment in services is vital. [ABSTRACT FROM AUTHOR]

This paper evaluates several small open economy DSGE models and the impact of external shock spillovers on small open economies. We investigate five small economies (the UK, Australia, Canada, New Zealand and Taiwan) and find that the welfare consequences vary depending on key domestic economic variables, and the best interest-rate rule varies across models. Then we examine the performances of the four types of models, a preferred result has been found in a model which considers the country risk premium, as the best rule could be obtained as long as the selected parameters are calibrated for particular economies. [ABSTRACT FROM AUTHOR]

This paper analyses the impact of trade liberalization on local labour markets in Ethiopia, with a focus on the gender dimension of employment and on the process of structural transformation. By exploiting rich micro-level data on Ethiopian workers, we evaluate the effect of the Ethiopian trade reforms on the changes and composition of employment. We find that districts more exposed to trade liberalization experienced reductions in their employment levels, especially in female employment. We also show that reductions in tariffs trigger a process of sectoral reallocation from agriculture to services and that this process is particularly pronounced for women. [ABSTRACT FROM AUTHOR]

A key challenge facing most developing economies today is how to simultaneously maintain monetary independence, exchange rate stability, and financial integration, subject to the constraints imposed by the impossible trinity. In this paper, we contribute to the literature by examining and comparing alternative macroeconomic policy choices for a developing economy with growth shocks. To that end, we introduce a three-sector "almost small" open economy macroeconomic model, and calibrate this model to proxy the China in 2005 when it made the transition from being an economy that was bounded by the impossible trinity. We design two alternative macroeconomic policy regimes and apply the calibrated model to analyze both the short-run and the long-run responses to several domestic and external growth shocks, which appeared important for a developing economy like China during its economic reform period in the 2000s. The model simulation shows that most growth shocks cause an expansion in the real GDP level. Moreover, greater flexibility in the exchange rate allows the central bank to conduct independent monetary policy, the benefit from which increases as financial capital becomes more internationally mobile. Our findings draw policy implication for those developing countries considering alternative macroeconomic policy regimes to achieve sustainable economic growth. [ABSTRACT FROM AUTHOR]

This paper studies the economy of Hong Kong through the lens of a small open economy DSGE model with a currency board exchange rate commitment. It assumes flexible prices and a banking system that provides credit to entrepreneurial household firms; the money supply is fully backed by reserves under the currency board. We estimate and evaluate the model by Indirect Inference over the sample period of 1994Q1-2018Q3; we find that it matches the data behaviour as represented by a VAR. We examined the economy's volatility using bootstrapping of the model innovations, under both the estimated currency board model and a standard alternative regime with floating exchange rate and a Taylor rule; we found that Hong Kong welfare is higher in the currency board, which substantially reduces output volatility. [ABSTRACT FROM AUTHOR]

Many works have examined the variables driving the formation of North-South free trade agreements (FTAs) between developed and developing countries. This study analyzes the determinants shaping their utilization in the contexts of their political economy and of Generalized System of Preferences (GSP) schemes that are unilaterally granted by developed economies to developing countries' exports. Most of the goods liberalized through GSP are liberalized from early on in North-South FTAs; however, since FTA concessions are legally binding, goods that are excluded or only partially liberalized in GSP will be also excluded or protected in FTAs. As GSP schemes are subject to unilateral restriction/elimination by the developed country, exporters using GSP tariffs will lobby for the non-removable liberalization of their exports through an FTA and subsequently will have a high FTA utilization. These scenarios result in North-South FTAs being used to a great extent to export goods covered by and exported through GSP, thus consolidating pre-FTA trade patterns. These arguments were tested by analyzing disaggregated and rarely accessed data on Thailand's and Malaysia's exports through the Japanese GSP and their bilateral FTAs with Japan, as well as interviews with key actors involved in the policymaking of these FTAs. Most sectors in Thailand and Malaysia that benefited from GSP lobbied for FTA liberalization with Japan. Goods previously exported through GSP account for most of FTA utilization and the previous use of GSP preferences has a higher predictive value of subsequent FTA utilization than FTA tariff savings. [ABSTRACT FROM AUTHOR]

Following independence in 1960, Nigeria intentionally crafted a 'big brother' honorific title for itself inspired by a Pan-Africanist Afrocentric ideology which it pursues through altruistic sharing of its human, military and economic resources. Successive governments have internalized this Africa-focused foreign policy thrust to establish a putative regional influence in Africa. However, despite belatedly signing the African Continental Free Trade Agreement which seeks to increase intra-African trade and introducing a novel visa-on-arrival policy for African passport holders, the porosity of Nigeria's boundaries continues to pose a threat and has led to the closure of land borders with its West African neighbours in August 2019. This article examines the implications of Nigeria's schizophrenic 'border diplomacy' for its continental leadership and argues that the substance and rhetoric of the country's border diplomacy represent a foreign policy interest which prioritizes its people, economy and national security while normatively extending Nigeria's hegemonic leadership in Africa. [ABSTRACT FROM AUTHOR]

A correction to the article "Support for Free Trade: An Experimental Survey in Estonia and Latvia" by Ryo Nakai published within the issue is presented.

The study draws inference on the impact of agricultural trade openness, total factor productivity (TFP) growth, and domestic agriculture support on food security in Africa. To retain estimates efficiency and consistency in the presence of complex error terms, we employed the Panel-Corrected-Standard-Error (PCSE) estimator on panel data spanning 2005–2016 for 13 African countries. Results suggest that agricultural trade liberalisation and TFP have significant and favourable effects. Moreover, we find that reducing agricultural support beyond distortion-free levels enhances food security. Further to trade openness, we call for export growth-oriented domestic support anchored on agricultural human-capital development, innovation, and research and development. [ABSTRACT FROM AUTHOR]

This contribution examines to what extent the EU includes Moroccan and Tunisian civil society actors in bilateral political processes in the two policy domains of trade liberalization and anti-corruption. It finds that while the EU has strongly committed itself to more such interaction, gaps between its discourses and its practices remain. We observe variance between both sectors and both countries. Civil society is much more substantially included in EU policy processes in Tunisia than in Morocco, which is partly due to the EU's respect for some of Moroccan government's red lines. Moreover, the EU tends to be more open towards including civil society on transparency and anti-corruption than on trade. This may at least partly be explained by the fact that EU interests are more aligned with those of civil society on the former than on the latter. [ABSTRACT FROM AUTHOR]

The rise of market power has sparked off increasing public debate over the past decade. Using a novel large-scale firm-level dataset, this paper examines the effect of trade liberalization on corporate market power in emerging and developing economies. We find that opening up to trade significantly reduces market power by promoting competition and improving resource allocation. The cumulative impact is estimated at 4 percent reduction in average markups over a 5-year horizon post each trade liberalization episode. We also draw on machine learning algorithms to account for nonlinearities in the relationship and show that trade reform is complementary to other structural reforms. [ABSTRACT FROM AUTHOR]

Recent trends in inequality have raised concerns among researchers and policymakers globally. The role of globalization, one of the leading forces driving this trend, continues to be intensely debated in academic and policy circles. Invoking standard trade theory, this paper analyses whether and the extent to which trade liberalization has contributed to the recent trends in inequality. The approach and findings of the paper are novel: previous studies of trade liberalization's impact on inequality do not explicitly control the direction of trade. The empirical results show that trade liberalization is associated with decreasing income inequality overall, but contingent on the direction of trade, it has opposing effects: North–North and South–South trade are inequality-reducing while North–South trade is inequality-increasing. Simply put, liberalizing trade between countries of similar developmental levels does not raise inequality. This paper affirms, using recent data, that trade with developing countries raises inequality in developed countries. Additionally, it finds that North–South trade (particularly imports from high-income to low-income countries) may also raise inequality in developing countries, contrary to Heckscher–Ohlin–Stolper–Samuelson model predictions. Skill-biased technical change, a consequence of trade liberalization between North and South, is the main mechanism driving inequality increases in developing countries. [ABSTRACT FROM AUTHOR]

The choice of an exchange rate regime is crucial in small open economies (SOEs) with a dollarized financial sector. While the traditional Mundell–Fleming model supports a floating exchange rate, evidence shows that central banks frequently intervene in exchange markets. One of the reasons for these interventions is the consequences of large depreciations that could trigger negative balance-sheet effects. This paper extends the literature about the optimal monetary policy in SOEs, by considering a heterogeneous hedge across tradable and non-tradable sectors. Our findings support a 'leaning against the wind' policy as an optimal response to negative external shocks. This result is present even if only one sector of the economy faces credit constraints. We show that the vulnerability of the economy to large negative external shocks depends not only on the overall leverage, but also on the distribution of foreign currency debt across economic sectors. [ABSTRACT FROM AUTHOR]

This article examines the extent to which the latest wave of trade and investment treaties has impacted the fiscal stability of the world's nations. We construct two new measures of trade liberalization based on the importance of a country in the global network of trade and investment treaties, namely the number of trade treaty links and the hub connectedness of a country. This analysis is important since many analyses of the welfare impacts of trade liberalization typically do not consider the impact on the fiscal balances of governments or assume that any loss of tariff revenue would be made up by the imposition of indirect taxes, like a Value Added Tax. Using a cross-country regression analysis, we confirm that trade liberalization has, on average, reduced the amount of tariff revenue collected. Furthermore, trade liberalization is not correlated with an automatic compensation for lost tariff revenue through other taxation measures. We find, in some cases, that trade and investment treaties are correlated with a reduction in total fiscal revenues and an increase in government debt. These results suggest that policymakers need to take the fiscal impacts of trade and investment liberalization into account when making decisions about trade and investment policy. [ABSTRACT FROM AUTHOR]

This study examines the effect of trade openness on environmental sustainability risk, with emphasis on the role of governance and regulatory factors. Data for the study were compiled from 39 countries in Sub-Saharan Africa (SSA) from 2001 to 2018. Results from a two-step system generalized method of moments estimation suggest that for the sub-region, governance and regulatory variables significantly moderate the trade openness–CO2 emission nexus, suggesting that improved governance and regulatory structures help in reducing CO2 emissions associated with trade openness. For the trade openness–ecological footprint relationship, the empirical estimates further suggest that government effectiveness significantly moderates the nexus. [ABSTRACT FROM AUTHOR]

In today's internationalism-sceptical age, the pro-internationalism side is defended from liberal perspectives. Worries concern free trade, free movement, international representative institutions, and senses of global democracy. These are important issues. On the other hand, they cloud the reality that other forms of internationalism have been available to us, including in times not distant from our own. I'm interested to think through 'red' internationalisms – internationalisms held by social democrats on one hand and the communist world on the other. Arguing that though a previously close family clearly split, that split might look different than we think. Furthermore, even though one branch of that family lives on, it's a different creature than it once was. These are 'lost traditions of internationalism' – internationalisms that were sometimes problematic yet might be worth remembering in times when we often think the options are either disbanding internationalism altogether or supporting the liberal institutionalisms against which populists often rail. [ABSTRACT FROM AUTHOR]

In recent years, debate about the distributive consequences of trade liberalisation has intensified on both sides of the Atlantic. Within the European Union (EU), a strong politicisation of trade policy occurred in the wake of the launch of negotiations on a Transatlantic Trade and Investment Partnership (TTIP) with the United States (US). These talks were effectively portrayed by critics of the agreements as 'made for and by big business', a master frame that succeeded in bringing together a broad coalition of civil society organisations. In this article, we show how the European Commission developed and communicated a counter-frame stipulating that TTIP and similar trade agreements are inclusive of and especially valuable to small firms. Based on a framing analysis of official documents and speeches, we analyse the rationale of this frame and how it has been communicated through story-telling. We show that this positive frame has only partially been mirrored in the positions of associations representing small firms themselves. The debate on the inclusive benefits and redistributive effects of trade agreements, including between enterprises of different sizes, continues within academia, politics, and society. [ABSTRACT FROM AUTHOR]

The economic populism said to be represented by the votes for Brexit and Donald Trump and the breakdown in trade and investment following the COVID-19 outbreak have rekindled interest in the redistributive consequences of trade liberalisation. Against this backdrop, the authors in this Special Section consider the broader drivers of inclusion and exclusion in trade governance, focusing on the trade politics of Canada, the European Union and the United States. This short introduction spells out the importance of considering the interplay between redistributive and deliberative drivers of inclusion and exclusion in producing trade policy contestation. It focuses on the three key drivers of inclusion and exclusion that the authors subsequently draw on in their contributions: discursive factors; institutional mechanisms and inter-scalar and multi-level dynamics. [ABSTRACT FROM AUTHOR]

In response to growing contestation and politicisation of trade policy, policy makers have aimed to enhance the 'inclusiveness' of trade policy through the institutionalisation of deliberative forums in which civil society organisations participate. However, it is not clear whether these processes actually enhance inclusiveness. This article adds to our understanding of this question by, first, developing an analytical framework (the 'inclusiveness ladder') and, second, applying it to the civil society mechanisms (CSMs) of European Union (EU) free trade agreements. The unique feature of CSMs is their focus on ensuring that the actual implementation of trade agreement does not run counter to sustainable development principles. Specifically, our empirical research involves a mixed methods analysis of primary and secondary sources and a survey of civil society participants. We find that CS is largely included at the level of logistics and partly at the level of information sharing, whereas monitoring capacities remain limited and impact on policy-making is quasi-absent. Moreover, results suggest differences between business participants, who seem largely satisfied with the lower steps on the 'ladder', and non-governmental actors who insist on policy impact. Finally, we outline avenues for further research and reflect on policy implications. [ABSTRACT FROM AUTHOR]

As a component of illicit globalization, smuggling has loomed large in international political economy in recent years. The question of sovereignty is at the forefront of the discussion because smugglers make efforts to evade state regulations and thus jeopardize sovereign power. This paper examines the operation of commodity smuggling between China and Myanmar and discusses major factors that facilitate this business. Another objective is to explore antismuggling initiatives launched by the Chinese state to exercise its sovereignty over cross-border commodity flows. The study case is the Ruili (China)-Muse (Myanmar) border crossing, where smuggling has been an essential component of cross-border networks for decades. Increased smuggling does not infer the Chinese state as weak or failing, but reveals the illicit side of globalization that operates in parallel with trade liberalization and economic integration. Nevertheless, border control is not in vain, but draws on antismuggling campaigns to push informal economies to become formalized, and safeguards national sovereignty at the border. This article presents new material on the complexity of trade governance in one of Asia's most isolated borderlands, and contributes to theoretical debates on the articulation of effective sovereignty in relation to illicit globalization. [ABSTRACT FROM AUTHOR]

The entry of a low-wage country into a world economy with preexisting wage differentials puts the gains from trade in a former low-wage and then medium-wage country under pressure. If negotiations over the formation of a free trade area cover international transfers, there is a strong presumption that they bring about global free trade and compensation of the medium-wage country if necessary. In the absence of international transfers, by contrast, the medium-wage country is not compensated when global free trade causes a reduction in its gains from trade, and it may even happen that it is not part of the equilibrium free trade area. [ABSTRACT FROM AUTHOR]

In this article, I offer a methodological analysis of the empirical research on the causal effects of trade liberalisation, and assess whether such studies can be of any use for guiding policy prescriptions in real-world economies. The analysis focuses on the mainstream economic research that has been used to support arguments in favour of trade liberalisation during the last decades. Even though there are empirical results that could be taken as valid evidence for a causal connection between free trade and economic gains, none of the existing evidence licences trustworthy inferences about the policy effectiveness of trade liberalisation reforms in real-world cases. There are three aspects of the empirical literature that make it highly problematic for making reliable policy inferences: (a) the criteria used to define the notion of 'free trade', (b) the background assumptions embedded in the econometric techniques used for estimating causal effects, and (c) the widespread desire among academic economists to attain scientific results in terms of universally valid generalisations. The analysis exposes a worrisome mismatch between, on the one hand, the research aims and outcomes of scientific economics and, on the other, the kind of evidence that would be useful for guiding actual policy deliberations. [ABSTRACT FROM AUTHOR]

The paper presents a simple Stock-Flow Consistent open economy model with flexible exchange rates. It can reproduce the same dynamics and results of the flexible exchange rates 'benchmark' model by Godley and Lavoie [2007b. Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth. London, UK: Palgrave MacMillan]. The latter is considered the 'centre of gravity' of SFC open economy literature. Yet the new model uses only one-third of the equations of the original one and features a different mechanism of determination of the exchange rate. Its small size and its flexibility make the model suitable both for didactic purposes and for extensions with further building blocks to address a variety of research topics. [ABSTRACT FROM AUTHOR]

Established in 1989 as an economic forum, APEC has become an important regional organization contributing to the promotion of not only economic but also political and security cooperation among countries and territories in the region. Given the great role of APEC, China has actively participated in the forum and today has become a major player with so-called Chinese approaches. The paper points out China's purposes and intentions with Chinese way, especially under the attack of Covid-19 that has led to strategic adjustments in APEC. Politically, with APEC as an arena, China aims to restore and expand its sphere of influence in the region, hedge against the US and challenge to change the global governance system. Economically, through APEC's mechanism, China wants to promote trade liberalization and hence facilitate its domestic economic reforms to soon become the number one power in the world. Moreover, the paper also outlines opportunities and challenges that China would face in APEC. It will also concern China's advantages and barricades on its political regime as a powerful central authoritarian state, China's role and position in the dynamic economic region, its trade and territorial disputes with neighboring countries in APEC, and the questions of APEC's effectiveness. [ABSTRACT FROM AUTHOR]

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Based on the integrated data of the industrial pollution database, the customs database and the Chinese industrial enterprise database from 2000 to 2012, the system GMM Model is used to estimate the relationship between the liberalization of intermediate goods trade and corporate pollution emissions. Also, it is used to explore whether environmental regulations can achieve the reduction of intermediate goods trade effect. The results show that by dividing intermediate trade liberalization into importation and exportation, it aggravates the pollution emission of enterprises, while environmental regulations alleviate it. Heterogeneity analysis shows that the importation of intermediate products aggravates enterprise pollution in processing trade mode and reduces pollution in general trade mode. While exportation of intermediate products aggravates pollution in both of these two trade modes and only processing one is statistically significant. Geographically, both importing and exporting of intermediate goods aggravate enterprise emissions in the East and Midwest. More specifically, importation plays a bigger role in the Midwestern areas as exportation does in the eastern place. Furthermore, we discover that different industries differ greatly by dividing them into 11 categories. Therefore, it is necessary to optimize the trade structure of intermediate goods while considering the different development stages of different regions at the same time. [ABSTRACT FROM AUTHOR]

In Latin America, Brazil, Chile, Colombia, Mexico and Peru, have been using Inflation Targeting for at least two decades, and although there were significant improvements in social indicators, macroeconomic results have been mixed. In particular, the real exchange rate has been much more volatile and growth was significantly slower in Brazil and Mexico. In accordance with these facts, we sketch a simple New Consensus open economy model with hysteresis and we show that a policy that targets inflation disregarding the effects on the real exchange rate may have negative long-run effects. [ABSTRACT FROM AUTHOR]

Claude-Jacques Herbert's Essay on the general police of grain (Essai sur la police générale des grains) has particular features that could have enabled it to make a crucial contribution to the gradual conversion of French public opinion to free trade at the end of 1753. First, the essay is an explicit criticism of Delamare's Treatise on the police (Traité de la police) and of the French regulations of the grain trade. Against them, Herbert promotes new principles grounded on a specific conception of free trade and on the central role played by prices in economics. Reviewing these elements, we may suppose that the success of Herbert's Essay can also be explained by the conceptions it proposes. These could indeed have been approved both by the proponents of internal and moderate free trade and those of total freedom. [ABSTRACT FROM AUTHOR]