Essays on Regional Responses to Globalization

This dissertation explores various regional responses to globalization. The first chapter studies how booming regions spread local windfall from a commodity boom in the world market to other regions. The second chapter explores price divergence in the rice markets as an impact of a binding import ban, a policy imposed to support farmers from facing import competition. Lastly, the third chapter shows how the proliferation of electronic media, an aspect of globalization, facilitates improvement in marketing technology in advertising tobacco products. I show that such improvement in reaching consumers and potential consumers increases the smoking participation of young adults.Chapter 1 studies how regions respond to price shocks in the presence of internal migration. This paper examines Indonesia in the 2000s as it faced a commodity boom for palm oil, which became one of its main export commodities. I exploit the variation in the land shares and crop suitability to compute the potential contribution of main crops across district economies as a measure of local exposure to shocks. I find that the commodity boom increased the purchasing power of palm oil-producing districts. These districts also received more migration, providing evidence that palm oil price shocks were no longer localized. Indeed, internal migration spread the windfall. I also find spillover to neighboring districts. However, these relatively higher levels of purchasing power did not last after the commodity boom ended in 2014. I show that the palm-oil sector grew through extensification as a response to the price shocks, with no indication of growth through intensification. I estimate the overall welfare gains in Indonesia between 2005 and 2010 and find substantial gains from migration.Chapter 2 explores and documents the price divergence that occurs due to a large and ongoing import ban on rice imposed by Indonesia. I find that despite the increase in the retail price of rice, rice-producing districts