Search

Begin New Search Topic International Trade and Finance Publishing Institution United Nations University

81. Private Donations for International Development

Author:
John Micklewright and Anna Wright
Publication Date:
12-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Charitable donations by private individuals and firms can help fund the Millennium Development Goals. What are the prospects for increasing donations for international development, whether from small-scale donors, the super-rich (as in the recent gifts by Bill Gates and Ted Turner), or the corporate sector? The paper starts by reviewing how large are the sums currently given in OECD countries (including gifts of time) and the problems development has in competing with domestic causes. It then looks at possibilities for the future, including tax deductions, the new 'global funds', corporate social responsibility and 'cause-related marketing', the use of the Internet, and long-term donor education.
Topic:
Development, International Cooperation, International Trade and Finance, and Third World

82. Revenue Potential of the Currency Transaction Tax for Development Finance: A Critical Appraisal

Author:
Machiko Nissanke
Publication Date:
12-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper assesses the potential of currency transaction taxes (CTT, widely known as the Tobin tax), to raise revenue for global development. Though Tobin proposed and others assessed CTTs in terms of reducing exchange rate volatility and improving macroeconomic policy environments, this paper considers the CTT first and foremost from the standpoint of revenue. With a view of establishing a 'permissible' range of tax rates to obtain realistic estimates of revenue potential, it first reviews the debate over the effects of CTT on market liquidity and the efficiency of foreign exchange markets, and assesses the Spahn proposal for a two-tier currency tax. It then moves to a discussion of the technical and political feasibility of CTT, followed by an evaluation of several new proposals, such as those advanced by Schmidt and Mendez. The paper presents revenue estimates from CTT in light of recent changes in the composition and structure of foreign exchange markets.
Topic:
Development, Economics, Globalization, and International Trade and Finance

83. A Global Lottery and a Global Premium Bond

Author:
Tony Addison and Abdur R. Chowdhury
Publication Date:
12-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The world lottery market now amounts to at least US$126 billion in sales. World market sales for all gaming products (public, charitable and commercial) total some US$1 trillion, of which Internet gambling accounts for US$32 billion. This paper assesses the prospects for harnessing this large and growing market for the purposes of development finance by means of a global lottery and a global premium bond (with the successful UK scheme providing a model for the latter). Each has different strengths: the global lottery can add to the supply of grant finance for development, while the global premium bond could be an attractive savings instrument for ethical investors. The paper concludes that global versions of both a lottery and a premium bond are viable and complementary in mobilizing more development finance.
Topic:
Development, Economics, International Cooperation, and International Trade and Finance
Political Geography:
United Kingdom

84. The International Finance Facility: The UK HM Treasury-DFID Proposal to Increase External Finance to Developing Countries

Author:
George Mavrotas
Publication Date:
12-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper discusses the International Finance Facility (IFF), a joint HM Treasury-DFID proposal to increase development aid substantially for the Millennium Development Goals to be achieved by 2015. The main conclusion of the paper is that the proposed IFF is a promising, forward-looking and creative proposal for it implies a substantial increase in fresh, predictable and stable aid as well as a robust financial structure. However, there are a number of concerns about potential shortcomings of the proposal, namely its underlying assumptions about continuous commitment on behalf of the donor community towards the implementation of the IFF during the life of the Facility and most importantly its heavy reliance on political coordination among donor countries participating in the proposed scheme. Potential absorptive capacity constraints in IFF aid-recipient countries may be also relevant. Achieving its huge political task as well as alleviating the crucial constraints regarding its successful implementation seem to be the main challenges this innovative proposal needs to deal with in the near future.
Topic:
Development, International Cooperation, and International Trade and Finance
Political Geography:
United Kingdom and Europe

85. Some Welfare Implications of 'Who Goes First?' in WTO Negotiations

Author:
Basudeb Guha-Khasnobis
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We envisage a logical framework to explain why some trade negotiations are delayed because parties differ on who should 'go first'. In our model, there are substantive welfare implications depending on which party sets tariff rates (or subsidies) first in a strategic optimization exercise. When knowledge about cost levels are incomplete or missing, and hence must be guessed with a probability, the chances of conflict regarding who goes first are extremely high in the situation modeled in this paper. As an institution with some power to set the rules of negotiations, the WTO should be able to anticipate such conflicts in upcoming negotiations. It can then set the rule (in this case, dictate who should go first) depending on whose interest it wants to protect. There is a wide range of choices for the WTO in this regard: OECD consumer's surplus, OECD producers' loss, net exports of developing countries, firm profits, or even, world welfare as the sum of all these components.
Topic:
Development, International Organization, International Political Economy, and International Trade and Finance

86. Who Gains from Tariff Escalation?

Author:
Basudeb Guha-Khasnobis
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
With the help of a simple model of production and trade, we examine the differential impact of tariff escalation on skilled and unskilled wages in an economy. Our findings provide a lobbying-based explanation of the prevalence of tariff escalation in developed countries. It also predicts the possible response of a developing country and shows how similar lobbying activity in that country can slow the pace of liberalization of service sector trade.
Topic:
Development, Economics, and International Trade and Finance

87. International Trade, Location and Wage Inequality in China

Author:
Songhua Lin
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Models of economic geography predict that transportation costs directly affect demand for goods and the supply of intermediate inputs. One of the reasons that international trade is concentrated in the coastal provinces of China is that they have lower transportation costs in transporting goods to other countries than do provinces in the interior. This paper examines the relationship between the provincial wage rate and each province's access to international markets, and to suppliers of intermediate inputs. A gravity equation is first estimated to construct these 'market access' and 'supplier access' variables. In the second stage, the effect of market access and supplier access on the wage rate is estimated. It is found that about one quarter of the provincial wage differences in the coastal provinces and 15 per cent of the wage differences in the interior provinces can be explained by these economic geography variables.
Topic:
Industrial Policy and International Trade and Finance
Political Geography:
China, Israel, and East Asia

88. Economic Polarization Through Trade: Trade Liberalization and Regional Growth in Mexico

Author:
Andrés Rodríguez-Pose and Javier Sánchez-Reaza
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper analyses the impact trade liberalization and economic integration have had on regional growth and regional disparities in Mexico over the last two decades. It is highlighted that the passage from an import substitution system to membership of the General Agreement on Tariffs and Trade (GATT) first, and to economic integration in the North American Free Trade Agreement (NAFTA) later, has been associated with greater concentration of economic activity and territorial polarization. The analysis also shows that these changes herald a period of transition between two growth models. Regional growth in the final stages of the import substitution period was mainly characterized by convergence and linked to the presence of oil and raw materials and proximity to Mexico City. Economic liberalization and regional integration in NAFTA has been related to regional divergence, a reduction of the importance of Mexico City as the main market and to the emergence of an economic system in which the endowment of skilled labour starts to play a more important role.
Topic:
Economics and International Trade and Finance
Political Geography:
North America and Mexico

89. Regional Output Differences in International Perspective

Author:
Alan Heston and Bettina Aten
Publication Date:
08-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Accurate regional estimates of output are desired as an indicator of level of development and as a variable used to explain internal migration, demand patterns, fertility and other aspects of behaviour. This chapter explores one often neglected aspect of regional income differences, namely that due to price differences or regional purchasing power parities. When nominal regional income measures are adjusted for these price level differences they are termed real regional incomes. The preferred method of estimating regional purchasing power parities by detailed price comparisons is discussed for Brazil, the United States and the European Union. The empirical thrust of the chapter is an investigation of different methods for estimating regional real incomes based on PPP data for 167 countries and nominal regional incomes and other data for about 870 administrative areas at the subnational level. Even in their present form we believe the real income estimates provided for the geographical units present opportunities for understanding the world economic structure.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
United States, Europe, and Brazil

90. Impact of Trade Liberalization on Returns from Land: A Regional Study of Indian Agriculture

Author:
Ghosh Nilabja
Publication Date:
06-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Trade liberalization, by aligning domestic prices with world prices, is envisaged to bring welfare gains to a country. In the case of Indian agriculture, owing to the vastness and diversity of the sector, the impact is likely to be profoundly unequal across regions especially when liberalization is double-edged, acting on both output and input sides. This paper views returns from land resource as a primary determinant of farmers' economic well-being and production incentive and considers paddy both as the dominant support for the rural population and as a product with comparative advantage, as most studies have demonstrated. Working with state and sub-state level data and taking account of the differences in technologies, productivities and transport costs, the paper finds that the gains vary regionally and may not be positive in all cases when both output and input prices are globally aligned.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
South Asia and India

91. The EU's Everything But Arms Initiative and the Least-developed Countries

Author:
Lucian Cernat, Sam Laird, Luca Monge-Roffarello, and Alessandro Turrini
Publication Date:
06-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Using a computable general equilibrium simulation model and partial equilibrium simulations, based on the SMART model, the paper attempts to assess the aggregate worldwide distribution of gains and losses of the EU's Everything But Arms (EBA) initiative for both LDCs and third developing countries under different scenarios.
Topic:
Development and International Trade and Finance
Political Geography:
Europe

92. Developed Country Trade Barriers and the Least Developed Countries: The Economic Results of Freeing Trade

Author:
Jon D. Haveman and Howard J. Shatz
Publication Date:
06-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The Doha Ministerial Declaration emphasized that priority should be given to improving market access for products originating in the Least Developed Countries (LDCs). In this paper, we analyze the importance of this proposition with respect to market access in the Triad economies. We first present a brief history of non-reciprocal preferences granted by the Triad. This covers Generalized System of Preference (GSP) programmes in each, and further preferences granted to African, Caribbean and Pacific countries by the EU and preferences granted to Caribbean Basin, Andean, and African countries by the US. This history is followed by an assessment of trade generated by these preferences in the year 2000, and of the extent to which LDC exports might be expected to increase should the preferences be made comprehensive. Preferences in 2000 are shown to have led to an increase of US$3.5 billion in LDC exports, while a complete duty-free treatment could expand LDC exports by as much as US$7.6 billion, 90 per cent of which will be absorbed by the US. As this represents a doubling of LDC exports to these countries, we interpret these results as an endorsement of this priority in the Doha Round of negotiations.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
Africa, United States, and Caribbean

93. The New Global Determinants of FDI Flows to Developing Countries: The Importance of ICT and Democratization

Author:
Tony Addison and Almas Heshmati
Publication Date:
05-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Foreign direct investment (FDI) has increased dramatically in recent years. However, the distribution of FDI is highly unequal and very poor countries face major difficulties in attracting foreign investors. This paper investigates the determinants of FDI inflows to developing countries, with a particular emphasis on the impact of the 'third wave of democratization' that started in the early 1980s and the spread of information and communication technology (ICT) that began in the late 1980s. These two global developments must now be taken into account in any explanation of what determines FDI flows. Using a large sample of countries, together with panel data techniques, the paper explores the determinants of FDI. The causal relationship between FDI, GDP growth, trade openness and ICT is investigated. The main findings are that democratization and ICT increase FDI inflows to developing countries. The paper concludes that more assistance should be given to poorer countries to help them to adopt ICT and to break out of their present 'low ICT equilibrium' trap.
Topic:
Democratization, Development, Economics, and International Trade and Finance

94. Inflation, Output and Perfectly Enforceable Price Controls in Orthodox and Heterodox Stabilization Programmes

Author:
George Mavrotas and Mario Reyna-Cerecero
Publication Date:
05-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper deals with the success of price controls in stabilizing high inflation rates and their effects on the real economy under an imperfect competition setting derived by optimal maximization. Our model builds on Helpman's work of price controls and imperfect competition, and incorporates inflation inertia through adaptive expectations. The model predicts that under these circumstances price controls can be an effective method of curving inflation when they accompany an orthodox monetary restriction programme; incomes policies alone cannot curve inflation substantially. Efforts where monetary growth is decreased gradually and price controls are implemented to achieve zero inflation result in the boom-recession cycle observed in many real life programmes. When monetary growth is curved immediately and price controls are implemented to achieve zero inflation, there follows a recession and not a boom. Orthodox money-based stabilization programmes implemented on their own need more time to control inflation and always produce a recession.
Topic:
Development, Economics, and International Trade and Finance

95. The 'Pull' and 'Push' Factors in North-South Private Capital: Conceptual Issues and Empirical Estimates

Author:
Matthew Odedokun
Publication Date:
05-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper is an attempt to rectify some of the problems that characterize most earlier studies that seek to explain private capital flows to developing countries or, at least, to examine the subject from a different and complementary perspective. To accomplish this, we propose a model framework that approaches the issue from the perspective of a capital-exporting developed country and which also takes cognizance of developments in other industrialized countries that could be competing with developing countries for private capital flows. The model is operationalized and estimated with annual panel data over 1970-2000 for 19 capital-exporting developed countries. Specifically, we estimate equations for total private flows, FDI, total portfolio capital flows (PCF) and various categories of PCF. We also test for the effects of a number of factors, each of which has its own 'push' and 'pull' components. The specific explanatory factors are the level of per capita income, interest rate, economic growth, the prevailing phase of economic cycle, the degree of openness of the economy in the balance-of-payment capital account, macroeconomic imbalances, and external debt burden. The empirical findings confirm the posited effects of the 'push' and/or 'pull' component of each of the above factors.
Topic:
Development, Economics, Emerging Markets, and International Trade and Finance

96. Export Dynamism and Market Access

Author:
Jörg Mayer
Publication Date:
04-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Market access liberalization has influenced product-specific growth of world exports and contributed to the shift in the structure of world exports of manufactures towards electrical and electronic goods (including parts and components), goods that require high R expenditures, and labour-intensive products such as clothing. Multilateral trade liberalization has strongly improved market access conditions for manufactures and partly explains why manufactures have experienced particularly strong growth in exports. The increased importance of vertical international production sharing and the associated preferential trading arrangements between geographically close countries with significantly different wage rates have been a key determinant of differences in export-value growth across individual manufactured products, as well as of the distribution of market shares for some of these products among developing countries. Projections based on a standard trade model suggest that moving to full trade liberalization would lead to an increase in the share of agricultural products in total world trade by almost two percentage points and give greater weight to the textile, clothing and automotive sectors within manufactured exports.
Topic:
Development, Economics, Emerging Markets, and International Trade and Finance

97. If People were Money: Estimating the Potential Gains from Increased International Migration

Author:
Jonathon Moses and Bjørn Letnes
Publication Date:
04-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper we elaborate on the findings produced by an applied equilibrium model that is used to calculate the annual efficiency gains from free international migration. These findings suggest that we can expect significant gains from liberalizing international labour flows. In particular, we expand on two implicit aspects of the estimates: the actual number of migrants being generated by the various counter-factual scenarios, and the per-migrant cost/benefits associated with each. These estimates are then compared with contemporary migration flows and the findings of studies that analyse their economic impact. In light of these comparisons, we conclude that our original findings are not unreasonable.
Topic:
Development, Economics, International Trade and Finance, and Migration

98. E-business Model Innovation and Capability Building

Author:
Stéphane Gagnon
Publication Date:
04-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
A firm's business model describes the way in which it creates, delivers, and appropriates value. In the debate about the ongoing demise of several e-commerce ventures, only a few analysts have looked at the relative sanity of innovative e-business Models, relying mostly on static environmental variables and the inherent economic logic of each industry. Our study sheds new light on this debate by concentrating on a set of more complex factors, namely the relative difficulty to build new capabilities, whether by creating or acquiring them. We interviewed 60 e-commerce ventures between 2 and 3 years old, both independent and corporate ones, in order to measure their performance, the innovativeness of their e-business model, their obstacles to capability building, and their exploitable resource base. By performing cluster, discriminant, and regression analyses, we demonstrate that a number of typical obstacles to capability building can significantly affect the relative success or failure of innovative e-business models, but that a richer resource base may alleviate this relationship. We end with a discussion of the implications for the e-business model literature, and point out to some new directions to explain how various e-commerce firms, whether 'pure-play' or 'click-and-mortar', can successfully innovate despite rampant capability building difficulties.
Topic:
Economics, Emerging Markets, and International Trade and Finance

99. 'Looking at the Other Side of the Coin': The Relationship between Classical Growth and Early Development Theories

Author:
Maiju Perälä
Publication Date:
04-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper extends the history of thought narrative on Allyn Young to recognize the close relationship that the classical growth theory has with the early development theory, as Young's externalities-fuelled, cumulative growth process influenced the theoretical thought of the early development theory pioneers, Paul Rosenstein-Rodan and Ragnar Nurkse. The conditions that prevent the development of underdeveloped regions, indivisibilities and inelasticities of supplies and demands, represent the breakdown of the conditions that Young highlights as necessary for self-sustaining growth to occur. Hence, Young's cumulative growth process underlies the view of these early development theorists, though their focus is on the malfunctioning and restarting of this process.
Topic:
Development, Economics, Emerging Markets, International Trade and Finance, and Poverty

100. Aid, Debt Burden and Government Fiscal Behaviour: A New Model Applied to Côte d'Ivoire

Author:
Mark McGillivray and Bazoumana Ouattara
Publication Date:
04-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the impact of foreign aid on public sector fiscal behaviour in Côte d'Ivoire. A special interest is the relationship between aid, debt servicing and debt, given that Côte d'Ivoire is a highly indebted country. The theoretical model employed differs from those of previous studies by highlighting the interaction between debt servicing and the other fiscal variables. This model is estimated using 1975–99 time series data. Key findings are that the bulk of aid is allocated to debt servicing and that aid is associated with increases in the level of public debt.
Topic:
Debt, Development, Economics, and International Trade and Finance
Political Geography:
Africa