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72. Exchange Rate Pass-through to U.S. Import Prices: Some New Evidence
- Author:
- Jaime Marquez, Mario Marazzi, Nathan Sheets, Joseph Gagnon, Robert J. Vigfusson, Jon Faust, Robert F. Martin, Trevor Reeve, and John Rogers
- Publication Date:
- 04-2005
- Content Type:
- Working Paper
- Institution:
- Board of Governors of the Federal Reserve System
- Abstract:
- This paper documents a sustained decline in exchange rate pass-through to U.S. import prices, from above 0.5 during the 1980s to somewhere in the neighborhood of 0.2 during the last decade. This decline in the pass-through coefficient is robust to the measure of foreign prices that is included in the regression (i.e., CPI versus PPI), whether the estimation is done in levels or differences, and whether U.S. prices are included as an explanatory variable. Notably, the largest estimates of pass-through are obtained when commodity prices are excluded from the regression. In this case, the pass-through coefficient captures both the direct effect of the exchange rate on import prices and an indirect effect operating through changes in commodity prices. Our work indicates that an increasing share of exchange rate pass-through has occurred through this commodity-price channel in recent years. While the source of the decline in passthrough is difficult to pin down with certainty, our work points to several factors, including the reduced share of (commodity-intensive) industrial supplies in U.S. imports and the increased presence of Chinese exporters in U.S. markets. We detect a particular step down in the passthrough coefficient around the time of the Asian financial crisis and document a shift in the export pricing behavior of emerging Asian firms around that time.
- Topic:
- Economics, Industrial Policy, and International Trade and Finance
- Political Geography:
- United States and China
73. A New World Map in Textiles and Clothing
- Publication Date:
- 10-2004
- Content Type:
- Policy Brief
- Institution:
- The Organisation for Economic Co-operation and Development
- Abstract:
- The textile and clothing industries provide employment for tens of million of people, primarily in developing countries, and accounted for USD 350 billion in merchandise exports in 2002, or 5.6% of the world total. The current rules governing world trade in textiles and clothing will change drastically at the end of 2004, when countries will no longer be able to protect their own industries by means of quantitative restrictions on imports of textile and clothing products. What will this mean for cotton growers in Burkina Faso and Turkey, fashion retailers in France and the United States, or shirt factories in Bangladesh, the Dominican Republic or China?
- Topic:
- Civil Society, Development, Economics, and Industrial Policy
- Political Geography:
- Bangladesh, United States, China, Turkey, and France
74. Fifty Years of Regional Inequality in China: A Journey through Central Planning, Reform, and Openness
- Author:
- Ravi Kanbur and Xiaobo Zhang
- Publication Date:
- 08-2004
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- This paper constructs and analyses a long-run time-series for regional inequality in China from the Communist Revolution to the present. There have been three peaks of inequality in the last fifty years, coinciding with the Great Famine of the late 1950s, the Cultural Revolution of the late 1960s and 1970s, and finally the period of openness and global integration in the late 1990s. Econometric analysis establishes that regional inequality is explained in the different phases by three key policy variables; the ratio of heavy industry to gross output value, the degree of decentralization, and the degree of openness.
- Topic:
- Development, Economics, Industrial Policy, and Political Economy
- Political Geography:
- China and Asia
75. Trade and Labor Standards: A Strategy for Developing Countries
- Author:
- Sandra Polaski
- Publication Date:
- 01-2003
- Content Type:
- Working Paper
- Institution:
- Carnegie Endowment for International Peace
- Abstract:
- A debate has raged between developed and developing country governments for several years over whether or not to establish a global agreement on minimum labor standards that would be enforced at the international level through the World Trade Organization (WTO) or some other mechanism. That debate has become stale and ritualized. In the meantime the world has changed. For developing countries, the environment in which global labor standards must be considered was transformed in 2002.
- Topic:
- Development, Industrial Policy, International Organization, and International Trade and Finance
- Political Geography:
- China
76. Emerging Third Stage Peri-Urbanization: Functional Specialization in the Hangzhou Peri-Urban Region
- Author:
- Douglas Webster, Jianming Cai, Binyi Luo, and Larisa Muller
- Publication Date:
- 10-2003
- Content Type:
- Working Paper
- Institution:
- Walter H. Shorenstein Asia-Pacific Research Center
- Abstract:
- Hangzhou Municipality is the provincial capital of Zhejiang, on China's east coast. It forms part of the Yangtze River Delta (YRD) region. Hangzhou was “opened up” in the mid-1980s, following Deng Xiaoping's visit to the South, resulting in an almost immediate flood of foreign and domestic investment in manufacturing. This initial investment was significantly in the peri-urban areas, i.e., outside the built-up area. The authors have been following development in the Hangzhou extended urban region, with emphasis on peri-urbanization processes, since 2000. A previous APARC discussion paper describes findings of preliminary field research on the Hangzhou–Ningbo Corridor, conducted in August 2000 and March 2001. The present paper zooms in on two peri-urban clusters in the Hangzhou extended urban region, and assesses their development over time. The goal of the research is to better understand how a peri-urban region changes—particularly in terms of firm evolution, labor characteristics, and spatial dynamics—as it becomes more economically and demographically mature. This paper also examines such changes in the context of the increasing cost structures and emerging competitors, primarily from other areas in China, that the Hangzhou peri-urban region now faces.
- Topic:
- Demographics, Economics, and Industrial Policy
- Political Geography:
- China, Asia, and Maryland
77. China's State-Owned Enterprises: Thriving or Crumbling?
- Author:
- Christopher A. McNally
- Publication Date:
- 02-2003
- Content Type:
- Policy Brief
- Institution:
- East-West Center
- Abstract:
- Even though China's state firms lost their near-monopoly status after 1978, they still form the country's financial and industrial nucleus.Nevertheless, in early 1996 the total losses of these state-owned enterprises (SOEs) exceeded profits for the first time. With the economy threatened, offi-cialdom issued a mandate in 1997: SOEs must become profitable in three years. In 2001, statistics showed a massive turn around, and victory was declared. Despite doubts about the official statistics, substantial improvement did seem evident. The question was, what caused it? While massive layoffs and corporate restructuring did increase efficiency, most improvements have been the result of external factors such as debt restructuring and government-arranged buy-outs and mergers. This strategy offers short-term rewards, but could be a disaster in the long term. Real reform of China's state sector requires financial reforms that bite (even more urgent with WTO entry), serious moves toward a social security system for displaced workers, and more outright priva-tization of state firms to give non-state shareholders real power on their boards.
- Topic:
- Economics, Government, and Industrial Policy
- Political Geography:
- China
78. 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
79. Constitutional Causes for Technological Leadership: Why Europe?
- Author:
- Jurgen G. Backhaus
- Publication Date:
- 08-2001
- Content Type:
- Working Paper
- Institution:
- Independent Institute
- Abstract:
- In a paper circulated towards the end of 1997 under the title Why Europe?, Gordon Tullock poses a simple question and provides a tentative, yet provocative answer. The question is why the technological take off took place in Europe and in the 19th century when well into the 18th century other areas of the world, and notably China, looked much better poised for technological and scholarly leadership than Europe. His tentative answer turns on the constitutional composition of the landscape of political entities in Europe. This essay tries to provide some further underpinnings to aspects of Gordon Tullock's preliminary answer.
- Topic:
- Industrial Policy and Science and Technology
- Political Geography:
- China and Europe
80. The Place of the Defense Industry in National Systems of Innovation
- Author:
- Kenneth Flamm, Ann Markusen, Judith Reppy, John Lovering, Claude Serfati, Andrew D. James, Eugene Cobble, Judith Sedaitis, Corinna-Barbara Francis, Dov Dvir, Asher Tishler, and Etel Solingen
- Publication Date:
- 04-2000
- Content Type:
- Working Paper
- Institution:
- The Judith Reppy Institute for Peace and Conflict Studies
- Abstract:
- A review of current and forthcoming developments in the European defense industry (which here means mainly Britain, France, Germany, and Italy) would lead, I believe, to some fairly clear conclusions. The relationship between sectoral and national (including regional) economic development is changing profoundly. This is above all because the defense industry currently represents a major and extremely significant instance of globalization. However, this is not the kind of globalization described in many summaries.
- Topic:
- Security, Defense Policy, Economics, and Industrial Policy
- Political Geography:
- Russia, United States, China, United Kingdom, Middle East, and France