Michael J. Ferrantino

Export diversification and structural dynamics in the growth process: The case of Chile

Abstract It is frequently suggested that export diversification, or the progression from ‘traditional’ to ‘non-traditional’ exports, is an important component of export-led growth. This paper constructs several measures of diversification and structural change in exports in the context of the Chilean experience of the last 30 years. We find that since the mid-1970s, Chilean growth has been accompanied by export diversification, while little diversification had taken place previously. Structural change has accelerated during periods of internal crisis and external shock. Thus, while diversification may happen in the long run, in Chile it only happened during times of severe structural change and this suggests that a policy of deliberate diversification may not be as desirable as the diversification process that is a result of a change in currency valuation and trade liberalization.

The Effects of Non-Tariff Measures on Prices, Trade, and Welfare: CGE Implementation of Policy-Based Price Comparisons

The global economic effects of eliminating certain significant categories of nontariff measures (NTMs) are estimated in a CGE context. As a first step, a database of institutional information identifying alleged instances of NTMs for particular products and countries is constructed based on WTO, U.S. Government, and EU sources, and compared with the UNCTAD policy inventory. This database is then concorded to a GTAP-feasible multiregion, multisector aggregation. Retail price data from the EIU CityData database, similarly concorded, are analyzed econometrically, taking into account systematic deviations from purchasing-power parity, to determine whether and to what extent the presence of alleged NTMs is associated with significantly higher prices. The estimated price effects are then used to calibrate a CGE simulation in order to obtain simulation estimates of trade and welfare effects of their removal, which can be disaggregated. Removal of the categories of NTMs under consideration yields global gains on the order of

Export Sector Dynamics and Domestic Growth: The Case of Colombia

90 billion. These gains arise notably from liberalization by Japan and the European Union by region, and from liberalization of apparel and machinery/equipment by sector.

Monte Carlo Appraisals of Gravity Model Specifications

Analyses of Colombian data have generally failed to confirm the hypothesis of export-led growth. This paper generates several measures of export diversification and structural change in exports, and argues that these measures are useful in assessing growth externalities generated by the export sector. In a simultaneous-equations framework, increases in the rate of export structural change are associated with accelerated Colombian GDP growth. Export diversification, by contrast, is not a source of economic growth, and the reduced-form relationship between aggregate lagged export growth and GDP growth is weak. Copyright 1999 by Blackwell Publishing Ltd

The technical efficiency of vacuum-pan sugar industry of India: An application of a stochastic frontier production function using panel data

Many improvements have been proposed for the basic gravity model specification, most of which are confirmed by standard statistical tests due to the large number of observations often used to estimate such models. We use Monte Carlo experiments to examine situations in which features of models may be found statistically significant (or insignificant) when it is known ex ante that they are absent (or present) in the underlying data process. Erroneous assumptions about the presence or absence of lagged dependent variables, fixed effects, free-trade associations and customs unions are shown to introduce economically important bias in estimates of the coefficients of interest, and in some cases to be confirmed spuriously. Policy effects, such as for free trade associations and currency unions, can also be confirmed spuriously when they do not exist in the data-generating process.

Land Transport for Export: The Effects of Cost, Time, and Uncertainty in Sub-Saharan Africa

Abstract A stochastic production frontier method is used to examine technical efficiency among Indian vacuum-pan sugar factories over a five-year period. Most factories are close to Indian best practice in terms of technical efficiency. Smaller firms and firms with access to sweeter cane are likely to be more efficient than other firms, while publicly owned firms are less efficient. There are transitory positive effects of a long crushing season on technical efficiency.

Export dynamics and economic growth in Latin America : a comparative perspective

In Sub-Saharan Africa (SSA), inland export transport costs and time delays are much higher for landlocked countries, vary substantially between different geographic corridors, and exhibit substantial uncertainty. Unit costs and costs of time for land transport of exports are high for many agricultural products relative to metals and other high-value products. We illustrate systemic uncertainty in land and maritime transport for exporting by use of simulation. Relationships among uncertainty, infrastructure quality, and other features of logistics systems are highly non-linear, and can be potentially used to identify priorities for trade facilitation.

Using Supply Chain Analysis to Examine the Costs of Non-Tariff Measures (NTMS) and the Benefits of Trade Facilitation

Export diversification trends the commodity composition of export portfolios export diversification and structural dynamics in the growth process - the case of Chile export sector dynamics and domestic growth - the case of Colombia the oil giants - Mexico and Venezuela Latin American export sector dynamics and economic growth - an international comparison externalities in the export sector and economic growth prospects for intra-Latin integration.

Trade Policy and Productivity Growth in OECD Manufacturing

It has become increasingly common to produce goods in a number of geographically dispersed stages linked by international trade. This tendency, known by names such as production fragmentation, processing trade, and vertical specialization, has important implications for the analysis of nontariff measures (NTMs) and trade facilitation. First, different types of NTMs or trade facilitation issues are naturally associated with different stages in the movement of goods. Different price gaps can be assigned to these stages, making it possible to decompose the overall amount of distortion and to prioritize the policies with the largest potential efficiency gains. Second, NTMs may accumulate in long supply chains, implying that their trade-distorting effects are greater for goods produced in a fragmented manner than for goods with simple production processes. There is evidence that trade costs are more important for high technology goods or goods undergoing several stages of processing. Issues with product standards may be particularly important for goods with long supply chains. The link between NTMs and supply chains also has implications for economic development and for the relationship between liberalization in services and goods.

Transshipment in the United States

Trade liberalization may promote economic growth in a number of ways, including by accelerating the rate of technological change. Firms that face more intense import competition may be spurred to greater rates of innovation; firms which export may absorb new technologies through their contact with international markets. This paper examines evidence on trade policy and productivity growth for a sample of thirteen OECD countries and including eighteen manufacturing sectors, using data primarily from the 1980s. Within individual sectors, there are strong productivity convergence effects within the OECD. After controlling for convergence, we find a positive association between high rates of productivity growth and low tariffs, and between high productivity growth and strong export performance. We found no particular association between high productivity growth and import penetration. The results are consistent with the possibility of positive linkages between trade liberalization and accelerated productivity growth. [F1, O4]