Jean-Marie Grether

Determinants of Technological Diffusion in Mexican Manufacturing: A Plant-Level Analysis

Abstract Production function estimates serve to measure and compare the productive efficiency of a large panel of Mexican manufacturing firms during a period of trade liberalization (1984–90). Foreign capital is found to have a positive influence on productive efficiency at the plant level but, contrarily to crossindustry studies, it does not lead to significant spillovers at the sector level. Enlarging the analysis, it is found that technological diffusion is favored by the size of the plant and by agglomeration economies, while its correlation with international trade exposure does not appear to be robust.

Who determines Mexican trade policy

Using a political economy approach, the authors analyze the pattern of protection in Mexicos manufacturing sector during the period of trade policy reforms (1985-89), when Mexico experienced significant trade liberalization and an important inflow of foreign direct investment. They take into account the potential effect of foreign direct investment on endogenous tariff formation. It turns out that the data support this analytic approach, in which the formulation of trade policy reflects political support, and in which the presence of foreign direct investment in the sector strongly affects the pattern of tariff protection before and after reform. In Mexican manufacturing, especially, sectors with heavy foreign direct investment received greater protection in import-competing sectors, although the move toward greater openness was associated with a reduction in the influence of industrial and foreign-investor lobbying.

Attitudes Towards Immigration: a Trade-Theoretic Approach

The paper uses a three-factor (capital, low- and high-skill labor), two-household (low- and high-skill individuals), two-sector trade model to analyze the determinants of voter attitudes towards immigration under direct democracy, and to identify factors that would be coherent with both the observed increase in the skilled-unskilled wage differential and the stiffening attitudes towards low-skill capital-poor immigration. If the import-competing sector is intensive in the use of low-skill labor, and capital is the middle factor, an improvement in the terms of trade or neutral technical progress in the exporting sector leads nationals to oppose immigration of capital-poor low-skill households. An increase in income inequality is also likely to stiffen attitudes towards this type of capital-poor, low-skill immigration prevalent in Europe until recently. Copyright Blackwell Publishing Ltd 2003..

Global manufacturing SO2 emissions: does trade matter?

A growth-decomposition (scale, technique and composition effect) covering 62 countries and seven manufacturing sectors over the 1990–2000 period shows that trade, through reallocations of activities across countries, has contributed to a 2–3% decrease in world SO2 emissions. However, when compared to a constructed counterfactual no-trade benchmark, depending on the base year, trade would have contributed to a 3–10% increase in emissions. Finally adding emissions coming from trade-related transport activities, global emissions are increased through trade by 16% in 1990 and 13% in 2000, the decline being largely attributable to a shift of dirty activities towards cleaner countries.

Trade and Climate Policies: Do Emissions from International Transport Matter?

This paper provides orders of magnitude of the importance of CO2 emissions from international freight transport activities under a variety of scenarios regarding trade and climate policies. It is based on a stylised multiregion, multisector CGE model that includes the four modes of international transport (air, water, road and rail) and where choices regarding the energy mix and transport modes have been endogeneised. A separate decomposition of emission changes into the well‐known scale, composition and technique effects is provided. Scale effects turn out to be roughly double in international transport than in exports, while technique effects are weaker due to less substitutability between energy inputs. As a result, international transport represents half of the world increase in global emissions when trade liberalisation is considered in isolation. When trade liberalisation is coupled with a carbon tax limited to rich countries, the change in international transport emissions represents roughly one‐eighth of the carbon leakage effect.

Trade, Technique and Composition Effects: What is Behind the Fall in World-Wide SO2 Emissions, 1990-2000?

Combining unique data bases on emissions with sectoral output and employment data, we study the sources of the fall in world-wide SO2 emissions and estimate the impact of trade on emissions. Contrarily to concerns raised by environmentalists, an emission-decomposition exercise shows that scale effects are dominated by technique effects working towards a reduction in emissions. A second exercise comparing the actual trade situation with an autarky benchmark estimates that trade, by allowing clean countries to become net importers of emissions, leads to a 10% increase in world emissions with respect to autarky in 1990, a figure that shrinks to 3.5% in 2000. Additionally, back-of-the-envelope calculations suggest that emissions related to transport are of smaller magnitude, roughly 3% in both periods. In a third exercise, we use linear programming to simulate extreme situations where world emissions are either maximal or minimal. It turns out that effective emissions correspond to a 90% reduction with respect to the worst case, but that another 80% reduction could be reached if emissions were minimal.

Sorting Out the Effects of Switzerland’s Accession to the EU: A Simulation Analysis

A long and still active debate surrounds the desirability for Switzerland to join the EU. Should the application be reactivated? Should it be for full or “partial” membership? If the controversies surrounding the debate have political, y and economic roots, it is fair to say that much of the debate is concerned about the economic effects. Will any increased efficiency gains be sufficient to compensate for the transfer that will have to accompany membership? What will be the effects of increased migration or the possible adoption of the euro? It is clear that with all the likely effects coming into play it is necessary to sort out their respective importance. A natural way to do so is simulation analysis, which is specifically designed to this purpose. This is what we set out to do in this paper.

Estimating the pro-competitive gains from trade liberalization: an application to Mexican manufacturing

An original two-stage method is proposed to estimate the pro-competitive gains from trade liberalization. In a first step, I estimate the sensitivity of the price-cost margins of domestic firms to changes in the effective rate of protection, on the basis of a structure-performance relationship. This parameter is later exploited in a second step, where the cost of protection is calculated on the basis of a simple partial equilibrium model where domestic and foreign goods are imperfect substitutes. Applied to the Mexican case, this estimation reveals that protection removal depresses margins significantly and suggests that important additional gains can be expected from pro-competitive forces.

Chapter 10 On the Track of the World's Economic Center of Gravity

This chapter proposes a refined and updated measurement of the Worlds Economic Center of Gravity over the 1950–2008 period, based on historical data provided by Maddison (2010) and on the detailed grid data of the G-Econ (Nordhaus, 2006) database. The economic center of gravity is located in the vicinity of Iceland during the first three decades, and then heads strongly toward the East since 1980. Regarding geographic concentration, world production is less concentrated than population across the Earths surface, and becomes even less so over time. A new decomposition technique is proposed, which suggests a structural break at the end of the 1970s. Measures of R&D activity, education expenditures and literacy as growth related indicators depict a spatial pattern that is consistent with the Eastern shift of the world economic center of gravity.