equity valuation using multiples we examine the valuation performance of a comprehensive list of value drivers and find that multiples derived from forward earnings explain stock prices remarkably well pricing errors are within 15 percent of stock prices for about half our sample in terms of relative performance the following general rankings are observed consistently each year forward earnings measures are followed by historical earnings measures cash flow measures and book value of equity are tied for third and sales performs the worst curiously performance declines when we consider more complex measures of intrinsic value based on short cut residual income models contrary to the popular view that different industries have different best multiples these overall rankings are observed consistently for almost all industries examined since we require analysts earnings and growth forecasts and positive values for all measures our results may not be representative of the many firm years excluded from our sample

preferential trading arrangements as strategic positioning abstract we analyze a three country model of trade negotiations in which countries can form bilateral free trade areas bilateral customs unions or a trilateral preferential trading arrangement and can continue negotiating after reaching an agreement in contrast to the literature on multilateral bargaining the set of agreements can form a nonpartitional network while in contrast to the network literature players can reach multilateral agreements patient enough countries only reach bilateral agreements if insiders gain more than outsiders which allows them to manipulate the status quo in subsequent negotiations however a hub and spoke pattern may then emerge and insiders then dissipate the advantages of strategic positioning we also use variants on the model to explain why a us commitment not to bargain bilaterally sustained progress at gatt negotiations and the rarity of open access preferential trading arrangements

party systems and electoral volatility in latin america a test of economic institutional and structural explanations three different theoretical explanations are tested for the exceptionally high level of electoral volatility found in contemporary latin america economic voting institutional characteristics of political regimes and party systems and the structure and organization of class cleavages a pooled cross sectional time series regression analysis is conducted on 58 congressional elections and 43 presidential elections in 16 latin american countries during the 1980s and 1990s institutional variables have the most consistent effect on volatility while the influence of economic performance is heavily contingent upon the type of election and whether the dependent variable is operationalized as incumbent vote change or aggregate electoral volatility the results demonstrate that electoral volatility is a function of short term economic perturbations the institutional fragilities of both democratic regimes and party systems and relatively fluid cleavage structures

trade liberalization antidumping and safeguards evidence from india s tariff reform abstract this paper is the first to use product level data to examine empirically whether countries use antidumping and safeguard exceptions to unwind commitments to lower tariffs in the face of domestic political economic pressure we focus on the case of india a country that underwent a major exogenous tariff reform program in the early 1990s and subsequently initiated substantial use of safeguard and antidumping import restrictions we first estimate structural determinants of india s import protection using the grossman and helpman 1994 model and provide evidence from its pre reform tariff data of 1990 that is consistent with the theory we then re estimate the model on the indian tariff data after the trade liberalization is complete and find that the model no longer fits a result consistent with theory and evidence provided in other settings that india s 1991 1992 imf arrangement can be interpreted as resulting in an exogenous shock to india s tariff policy however when we re estimate the model on data from 2000 2002 that more completely reflects india s cross product variation in import protection by including both its post reform tariffs and its additional non tariff barriers of antidumping and safeguard import protection the significance of the grossman and helpman model determinant estimates is restored we interpret these combined results as evidence that india unwound its commitment to reduce tariffs through use of antidumping and safeguard protection in the face of political economic pressure the estimates are also economically important and provide one explanation for separate results in the literature that the magnitude of import reduction associated with india s use of antidumping is similar to the initial import expansion associated with its tariff reform finally we interpret the implications of our results for the burgeoning research literature examining the effects of liberalization on india s micro level development

the regionalism debate an overview the following sections are included introductiondefinitionswto provisions for ptashistorical evolutioneffects on union membersvinerian analysis welfare effects of a tariff preferencetransport costs and ptasrules of origin in ftasnon traditional gains guaranteed market access shelter from contingent protection locking in the reforms and dispute settlementimplications for the global trading systemcan pta expansion lead to global free trade do ptas make multilateral liberalization less likely do ptas lead to a rise in trade barriers against nonmembers the spaghetti bowl phenomenonwto illegal policies in ptasopen regionalism deep integrationconclusions minimizing the adverse effects of ptasreferences this abstract was borrowed from another version of this item

optimal tariff equilibria with customs unions the authors construct a model of customs unions in which countries charge optimal tariffs customs unions internalize the externality that exists whenever two countries import the same good also customs unions make several countries into one large unit with more market power big customs unions can improve their members welfare relative to the free trade the authors model of customs unions separates the effects of tariff reduction from the effects of policy coordination the movement from nash equilibrium to a free trade association improves global resource allocations moving from a free trade association to a full customs union has ambiguous resource allocation effects

developing countries and the gains from regionalism links between trade and farm policy reforms in mexico we use a multi country computable general equilibrium cge model with agricultural policy details to simulate the effects of north american free trade agreement nafta we find that mexico gains from nafta only when it also removes domestic distortions in agriculture in that case agriculture can generate allocative efficiency gains large enough to offset the terms of trade losses that arise because mexico has higher initial tariffs than its nafta partners when an rta forces a developing country to reform its domestic distortions that are linked to trade restrictions it becomes a building block toward multilateralism

bilateralism and free trade we study a setting with many countries in each country there are firms that can sell in the domestic as well as foreign markets countries can sign bilateral free trade agreements that lower import tariffs and thereby facilitate trade we allow a country to sign any number of bilateral free trade agreements a profile of free trade agreements defines the trading regime our principal finding is that in symmetric settings bilateralism is consistent with global free trade we also explore the effects of asymmetries across countries and political economy considerations on the incentives to form trade agreements

is the wto passe the wto has delivered policy outcomes that are very different from those likely to emerge out of the recent wave of preferential trade agreements ptas should economists see this as an efficient institutional hand off where the wto has carried trade liberalization as far as it can manage and is now passing the baton to ptas to finish the job this paper surveys a growing economics literature on international trade agreements and argues on this basis that the wto is not passe rather and subject to some caveats this survey of research to date suggests that the wto warrants strong support while a more cautious view of ptas seems appropriate

what s my line a comparison of industry classification schemes for capital market research this study compares four broadly available industry classification schemes in a variety of applications common to capital market research standard industrial classification sic codes have been available since 1939 but are being replaced by north american industry classification system naics codes the global industry classifications standard gics sm system jointly developed by standard poor s and morgan stanley capital international msci is popular among financial practitioners whereas the fama and french 1997 algorithm is used primarily by academics our results show that gics classifications are significantly better at explaining stock return comovements as well as cross sectional variations in valuation multiples forecasted and realized growth rates research and development expenditures and various key financial ratios the gics advantage is consistent from year to year and is most pronounced among large firms the other three methods differ little from each other in most applications

anti dumping what are the numbers to discuss at doha while tariff barriers have decreased worldwide through various gatt rounds anti dumping has surged to play a crucial role as the most important non tariff barrier after much debate and opposition anti dumping is on the agenda of the doha round of multilateral trade negotiations and it is one of the most important issues especially for developing countries as they are the main targets of this policy instrument with this prospect it is important to assess the relevance of anti dumping not only by focusing on traditional users but by analysing the experience of new users which are now major players in the field this paper improves upon existing studies by providing a comprehensive assessment on the use of anti dumping first data on the time pattern of worldwide implementations of anti dumping laws are presented this time profile shows interesting relationships with legal developments in gatt and wto dispositions second usual sources of data are complemented with various other sources this allows the inclusion of recent heavy users like china russia taiwan and ukraine which are ignored in similar studies but important for their trade volumes this enlarged and updated dataset shows that new users are even more important than previously thought with implications for the doha negotiations

macroeconomic factors and antidumping filings evidence from four countries abstract this paper examines the relationship between antidumping filings and macroeconomic factors real exchange rate fluctuations affect the two criteria for dumping in opposite ways making the overall effect on filings ambiguous in theory examining the filing patterns of the four major users of ad law during the 1980 98 period we find that real exchange rates and domestic real gdp growth both have statistically significant impacts on filings bilateral filing data indicate that a one standard deviation real appreciation of the domestic currency increases filings by 33 we also find one standard deviation fall in domestic real gdp increases filings by 23

who is my peer a valuation based approach to the selection of comparable firms this study presents a general approach for selecting comparable firms in market based research and equity valuation guided by valuation theory we develop a warranted multiple for each firm and identify peer firms as those having the closest warranted multiple we test this approach by examining the efficacy of the selected comparable firms in predicting future one to three year ahead enterprise value to sales and price to book ratios our tests encompass the general universe of stocks as well as a sub population of so called new economy stocks we conclude that comparable firms selected in this manner offer sharp improvements over comparable firms selected on the basis of other techniques

information content of equity analyst reports abstract we catalog the complete contents of institutional investor all american analyst reports and examine the market reaction to their release including the justifications supporting an analyst s opinion reduces and in some models eliminates the significance of earnings forecasts and recommendation revisions analysts both provide new information and interpret previously released information the information in a report is most important for downgrades target prices and the analyst s justifications are the only significant elements for reiterations no correlation exists between valuation methodology and either analyst accuracy or the market s reaction to a report our adjusted r 2 s are much larger than those of studies using only summary measures

are global trade negotiations behind a fragmented world of gated globalization abstract we show that global trade negotiations can prevent global free trade in a simple model where global tariff negotiations precede sequential free trade agreements ftas we show fta formation can expand all the way to global free trade in the absence of global tariff negotiations but global free trade never emerges when global tariff negotiations precede fta formation this result arises precisely because global tariff negotiations successfully elicit concessions from negotiating countries moreover global tariff negotiations can produce a fragmented world of gated globalization where some countries form ftas that eliminate tariff barriers among themselves while outsiders continue facing higher tariffs

the effect of the set of comparable firms on the accuracy of the price earnings valuation method the price earnings pie valuation method estimates a firm s stock price as the product of its earnings and the pie multiple determined from a set of comparable firms this paper studies empirically the accuracy of the pie valuation method when comparable firms are selected on the basis of industry risk and earnings growth the effect of adjusting earnings for cross sectional differences in leverage is also examined

on the role of retaliation in trade agreements this paper analyzes the role of retaliation in trade agreements it shows that in the presence of private information retaliation can always be used to increase the welfare derived from such agreements by the participating governments in particular it is shown that retaliation is a necessary feature of any efficient equilibrium we argue that retaliation would not be necessary if governments could resort to international transfers or export subsidies to compensate for terms of trade externalities within the current world trading system though in which transfers are seldom observed whereas export subsidies are prohibited the use of the remaining trade instruments in a retaliatory fashion might be optimal the model is used to interpret the retaliatory use of antidumping observed in the last decades and the proliferation of these measures relative to other trade remedies

the chilling trade effects of antidumping proliferation advocates of antidumping ad laws downplay their negative effects by arguing that the trade flows that are subject to ad are small and their distortions negligible but while the adverse effect of ad on product level trade has long been established the question remains whether there are trade effects at the aggregate level the recent proliferation wave of ad laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing ad laws for this purpose we estimate the effect of ad on bilateral trade flows between the new adopters of ad laws and their trade partners using a gravity model of annual observations 1980 2000 our estimates show that ad has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors we find that new tough users experience a chilling of their aggregate imports of 14 billion us a year or 5 9 as a result of ad measures for some countries like mexico and india the dampening effects of ad laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization

the theory of preferential trade agreements historical evolution and current trends the theory of preferential trade agreements pta s or what might be described in policy terms as the general agreement on tariffs and trade gatt article xxiv sanctioned freetrade areas fta s and customs unions cu s has undergone two phases of evolution in two very different modes largely reflecting the contrasting policy concerns of the time in this paper we trace this evolution offering both a historical context and an intellectual coherence to diverse analytical approaches

antidumping law as a collusive device in the united states many antidumping petitions are withdrawn before the investigations are completed prusa 1992 argues that petitions are used by domestic industries to induce foreign industries into collusive agreements in his model all antidumping petitions should be withdrawn which is not the case this paper provides a model in which only some petitions are withdrawn withdrawal depends on two key parameters coordination cost and bargaining power of domestic and foreign industries a new data set is constructed to test the model on the u s experience for the period 1980 97 the econometric analysis supports the theoretical conclusions of the model

economic determinants of the timing of preferential trade agreement formations and enlargements preferential trade agreements ptas have proliferated over the past 60 years while a small number of recent studies have examined empirically the economic determinants of the likelihood of a pair of countries having a pta this study explains empirically the timing of all pta formations and enlargements from 1950 through 2006 using duration analysis our main and novel goal is to predict in and out of sample a substantive share of these 1 560 pta events using a parsimonious model with mainly economic variables taking selection dynamics into account our analysis reveals that we can predict correctly in sample the actual year of entry into force for 26 of the 1 560 bilateral pta formations enlargements in the period 1950 2006 among 10 518 pairings of 146 countries using only a few economic and political variables moreover we can predict correctly in sample 57 of these pta events within a 10 year window leading up to the event using this model the model also performs well out of sample for the near term 82 but not if the out of sample period is very long we conclude with an evaluation of the model s ability to predict the timing of the north american free trade agreement the european union s formation and enlargements and the model s ten most likely post 2006 pta events jel f14 f15

trade creation and trade diversion effects of regional trade arrangements low income countries although the number of regional trade arrangements rtas among the lowest income developing countries is surging the literature on their welfare effects is still scarce and the few that exist fa

feasible multilateralism and the effects of regionalism recent research has underlined the efficiency of the gatt wto rules from the standpoint of politically motivated governments emphasizing that the current multilateral rules are capable of delivering a politically efficient equilibrium such an equilibrium is however economically inefficient global free trade in particular is generally unattainable even in a fully cooperative world provided that governments have distributive motivations in such a context we show that regional trade agreements can help move the world towards a welfare superior equilibrium the reason is that as members of regional trade agreements lower trade barriers against one another they are induced to reduce their multilateral tariff sa s well once we account for these endogenous changes and only then we find that regionalism can raise world welfare even in a fully cooperative but political world we also find however that members are likely to gain too much from regional integration thereby harming outsiders

evolution in the use of antidumping mechanism after uruguay round abstract this paper analyzed how the main economies have used the antidumping measures ad after the uruguay round between 1995 and 2012 therefore some techniques were employed in order to reveal the main ad users and the trend of using this instrument associated to each one of them we also tested the hypothesis that countries could converge in terms of the number of ad cases and if spatial effects could be involved in this process finally a criterion was established and a model was estimated in order to identify countries that usually favor the most competitive sectors through ad practice the results revealed that brazil was the only heavy ad user that was counter to the general downward trend verified on the ad cases meanwhile china was not only the main target of this mechanism but the cases against this country showed a growth trend also furthermore we found that the number of ad cases opened by traditional and nontraditional users is converging finally both the index and the estimated model have indicated that turkey and the eu seem to be favoring the most competitive industries through the ad practice

the free trade area of the americas good for latin america the following sections are included introductionmercantilist bias in the effects of discriminatory liberalizationpreferential tariff liberalization the basic casebeyond the basic caseftas under quotasnon traditional gains from north south integrationnaftastatic welfare gainsnon traditional gainsmarket accessshelter from new protectionism in the united statescredibility to and lock on the reformsa digression to the european unionthe free trade area of the americasregionalism and harmonizationa summary of conclusionsreferences this abstract was borrowed from another version of this item

the political economy of administered protection trade restrictions are hardly ever voted directly by congress though the threat of direct congressional action is frequently present pressure for protection is usually applied through the major instruments for the administrative regulation of imports the antidumping and countervailing duty procedures and the escape clause mechanism in this paper we will examine these instruments for the administrative regulation of imports the form of the paper is not novel a theory of how these mechanisms work is developed then operational implications of this theory are deduced and tested over the record of countervailing duty antidumping and escape clause cases decided from 1975 through 1979 this is the period over which the trade act of 1974 was in force because the nature of these mechanisms is relatively unfamiliar a relatively large amount of institutional information is provided

regionalism and falling external protection in high and low tariff members abstract this paper provides evidence that the reduction in applied most favoured nation mfn tariffs resulting from a decrease in preferential tariffs is restricted to or significantly larger in high tariff members of preferential trade agreements ptas this heterogeneous impact is observed only when the share of preferential imports increases leading to a decline in tariff revenue this makes countries which tend to heavily depend on tariff revenue as a source of government funding more likely to reduce their mfn tariffs which is also observed in the data these results that are consistent with a mechanism operating through trade deflection and the associated loss of tariff revenue therefore lend support to the building bloc view of regionalism in countries applying high external tariffs before the agreement in contrast driven by other factors the impact in low tariff countries remains unclear with either insignificant effects or tariff substitution

rules or politics an empirical analysis of itc anti dumping decisions this research analyzes the international trade commission s anti dumping decisions from 1980 to 1986 the results suggest that commissioners use criteria consistent with the instructions set forth in u s legislation the analysis also indicates that political variables help predict commissioner decisions petitions involving senate oversight committee members constituencies may be systematically favored in the process evidence of possible bias toward less developed country exports is presented as well the methodology also yields estimates of commissioner specific fixed effects

multilateralism and the endogenous formation of preferential trade agreements abstract this paper examines the interaction between preferential trade agreements ptas and multilateral tariff reduction in a model of imperfect competition a growing literature finds that the formation of ptas alters the incentives for and the sustainability of multilateral tariff reduction we show that the causation is not one sided multilateral tariff reduction also affects the formation of ptas specifically tariff reduction enhances the incentives to form a pta and increases the likelihood that it is self enforcing thus each round of multilateral tariff reduction should lead to a new wave of ptas this may help to explain the current trend towards regionalism

welfare costs of the u s antidumping and countervailing duty laws abstract the antidumping ad and countervailing duty cvd laws in the united states have become the most pervasive form of import relief sought by domestic producers this paper estimates the collective economic effect of the hundreds of active u s ad cvd orders using a computable general equilibrium model we estimate that the collective net economic welfare cost in 1993 of these orders to be 4 billion this welfare estimate is sensitive to various modeling assumptions which are explored in the paper with the implementation of the uruguay round agreements the ad cvd laws remain one of the costliest programs restraining u s trade

endogenous trading bloc formation in a north south global economy the majority of the trading blocs to date are between similar countries rather than between developed and developing countries this paper provides a rationale for why trading blocs among similar countries may arise as an equilibrium phenomenon it develops a model of an asymmetric world economy in which there are at least four countries the countries are differentiated with respect to their market size and they choose their trading partners in the coalition proof nash equilibrium either there is global free trade or free trade areas are formed among similar countries la plupart des blocs commerciaux sont formes de pays similaires plutot que de pays developpes et en voie de developpement ce memoire explique pourquoi ce genre de resultat peut emerger en tant que phenomene d equilibre on developpe un modele d economie mondiale asymetrique dans lequel il y a au moins quatre pays les pays different par la taille et la nature de leurs marches et choisissent leurs partenaires commerciaux dans un equilibre libre de coalitions a la nash ou bien il existe un regime global de libre echange ou bien des zones de libre echange entre pays similaires emergent

the size of trading blocs market power and world welfare effects abstract we construct an n country n commodity trade model to analyze the implications of bloc size for nash equilibrium tariffs and welfare the relationship between the absolute size of symmetric trading blocs and their market power is ambiguous and we illustrate how this relationship varies with model parameters in contrast sufficiently large increases in the relative size of a bloc enhance its relative market power and cause the welfare of its country members to rise above the free trade level we establish the existence of an optimal bloc size and study the dependence of optimal size on the parameters of the model

the signaling power of trade protection this paper proposes an empirical analysis to provide new insight into the trade diversion effects of antidumping ad policy trade diversion is the shift in trade from named countries in an ad investigation to non named countries previous studies have concluded that ad action causes a considerable drop in exports from named countries however the extent to which trade is diverted to non named countries is still an open debate this paper examines to see whether ad action on named countries can have signaling effects on non named countries to examine the trade effects on non named countries a time series data at an 8 digit product level is constructed for all cases initiated between 1997 and 2003 in the european union the paper provides evidence that antidumping policy has signaling effects on non named imports

tariff liberalisation and increased administrative protection is there a quid pro quo theoretical models and intuition suggest that the amount of non traditional protection such as anti dumping duties will increase as more traditional forms such as tariffs are lowered under multilateral trade agreements this paper is the first empirical study of the role of tariff liberalisation in the spread of anti dumping through both correlations and regression approaches we analyse the relationship between tariff concessions made during the uruguay round trade negotiations and the filing of anti dumping petitions with particular interest in whether multilateral trade reductions have spurred the recent growth in new users of anti dumping policies we find that at least for developing economies tariff reductions agreed to under the uruguay round not only increased the likelihood of a country using anti dumping protection but also the total number of anti dumping petitions filed by countries

differences in the determinants and targeting of antidumping china and india compared despite both being developing countries china and india have markedly contrasting patterns in their use and targeting of antidumping ad measures we explore the factors driving ad use by these two countries considering in turn macroeconomic strategic and other determinants we find more regular or systematic features of ad use by china while india displays a less systematic pattern of ad use economic growth ad club effect and fta participation are shown to constrain ad use by china compared to india ad use by china is also more sensitive across industries furthermore china targets developed countries more than developing countries while india is less discriminating with respect to the country type it targets

do trade agreements stimulate international trade differently evidence from 296 trade agreements in a seminal article rose 2004 found that the assumed positive impact of the wto on international trade was questionable this finding has been scrutinised and modified in subsequent research using different data sets econometric methods and separating the wto from other forms of trade agreements a key characteristic of the subsequent literature is the rather simplistic way in which trade agreements are treated whereby all trade agreements are lumped together trade agreements come however in many different forms and shapes this study addresses these differences in trade agreements using a unique database of 296 trade agreements we distinguish 17 trade related policy domains and indicate whether the agreements contain legally enforceable commitments this extensive and novel taxonomy of trade agreements enables us to allow for the possible heterogeneity of the impact of trade agreements on international trade using a gravity model we find that trade agreement heterogeneity indeed matters for international trade and that countries experience significant trade increases due to comprehensive trade agreements even if not all participants are in the wto

a quantitative model for environmentally sustainable supply chain performance measurement abstract the development of robust mechanisms for supply chain performance measurement have been identified as an integral step needed for the transition towards sustainable supply chain systems and a greener global economy however measuring the environmental performance of supply chains is a challenging task due to several factors such as the lack of standardised methodologies and the inherent multi criteria nature of the problem by leveraging the capability of a multi regional input output framework to handle the complex and global nature of supply chains the current work presents a robust environmental sustainable performance measurement model underpinned by industrial lifecycle thinking as a result some theoretical insights are provided and an empirical application of the model to the metal products industry of the brics brazil russia india china and south africa nations undertaken in an attempt to address some of the methodological and applied measurement challenges in particular this allowed the modelling of carbon emissions trends within and between the brics nations and with the rest of the world over a 20 year period 1992 2011 as well as providing an opportunity to hypothesis on their future carbon emissions performances specific analyses of the metal product industry showed that demand represents the main driver for the increasing carbon footprint however the overall decline in reported carbon footprint was due to improvements in emissions intensity and efficiency gains induced by technology the study further assesses the effects of imports and economic growth on carbon footprint and discusses the implications of the study to sustainability transition processes in the brics nations

industrial targeting in free trade areas with policy independence we investigate the limits of a mechanism for free trade area fta formation that simultaneously satisfies internal industrialization targets for arbitrary targets we find necessary and sufficient conditions that guarantee that the mechanism is efficient for member countries individually even if other members do not implement the efficient policy when the objective is conservative designed to protect the level of industrialization previously achieved by the target industry member countries are guaranteed gains from the efficient policy and their fta participation the analysis covers cases with transportation costs and explains why minimally restrictive rules of origin support efficiency and policy independence on etudie les limites d un mecanisme de formation d une zone de libre echange zle qui simultanement rencontre certains objectifs internes d industrialisation pour des cibles arbitraires on definit les conditions necessaires et suffisantes qui garantissent que le mecanisme est efficient pour les pays membres individuellement meme si d autres membres ne mettent pas en place la politique efficiente quand les objectifs sont conservateurs tentant seulement de proteger le niveau d industrialisation auquel on s est donne acces anterieurement dans l industrie ciblee on peut garantir des gains pour les pays membres decoulant de la politique efficiente et de la participation a la zle l analyse examine aussi des situations avec couts de transport positifs et explique pourquoi des restrictions minimales sur l origine des produits assurent l efficacite et l independance des politiques

multilateral tariff cooperation during the formation of customs unions abstract we study the implications of customs union formation for multilateral tariff cooperation we model cooperation in multilateral trade policy as self enforcing in that it involves balancing the current gains from deviating unilaterally from an agreed upon trade policy against the future losses from forfeiting the benefits of multilateral cooperation that such a unilateral defection would imply the early stages of the process of customs union formation are shown to alter this dynamic incentive constraint in a way that leads to a temporary honeymoon for liberal multilateral trade policies we find however that the harmony between customs unions and multilateral liberalization is temporary eventually as the full impact of the emerging customs union becomes felt a less favorable balance between current and future conditions re emerges and the liberal multilateral policies of the honeymoon phase cannot be sustained

antidumping and countervailing duty decisions in the e c and in the u s an experiment in comparative political economy abstract in recent years there has been a growing concern about the recourse to antidumping measures by the gatt member countries such measures can become a substitute for selective protection in the present article the dumping and injury determinations of the e c are subjected to econometric analysis using the finger hall nelson fhn model which makes a distinction between the political determinants and the technical determinants the results show that the technical variables dominate the dumping decisions while the political variables are more important in the injury determinations of the e c a comparison with the results obtained by the fhn study confirm the broad similarity between the e c and the u s patterns although the e c injury decisions are somewhat more susceptible to the influence of political variables the results of the study suggest that those who are interested in restraining the misuse of the antidumping provisions should concentrate their attention on the injury determination mechanism

antidumping and retaliation threats abstract we propose and test two ways in which retaliation threats may dampen the antidumping ad activity we observe first the threat of retaliatory ad actions may make a domestic industry less likely to name a foreign import source in an ad petition second the prospect of a gatt wto trade dispute may make government agencies less likely to rule positive in their ad decision using a nested logit framework we find evidence that both retaliation threats substantially affect us ad activity from 1980 through 1998

tariff bindings and the dynamic formation of preferential trade agreements abstract we show that multilateral tariff binding liberalization substantially impacts the nature and extent of preferential trade agreement pta formation first it shapes the nature of forces constraining expansion of free trade agreements ftas the constraining force is a free riding incentive of fta non members under relatively high bindings but an exclusion incentive of fta members under relatively low bindings second multilateral tariff binding liberalization shapes the role played by ptas in the attainment of global free trade initially tariff binding liberalization leads to custom union cu formation in equilibrium but in a way that undermines the pursuit of global free trade however further tariff binding liberalization leads to fta formation in equilibrium and in a way that facilitates the attainment of global free trade our theoretical analysis also has implications regarding recent empirical discussions over the relative merits of ftas versus cus

partners to a preferential trade agreement implications of varying size abstract most often the theory of preferential trade agreements assumes a small home country and a large partner in this paper the welfare implications of a small trading partner are examined a distinction is found between two ranges of size a country may be just small or be ultra small conventional propositions about the likelihood of a gain or a loss from entering into a preferential agreement would still hold when the partner is small whereas some of them would have to be reversed when the partner is an ultra small economy

regionalism in a multilateral world recent regional initiatives have been addressed from a vinerian perspective of trade creation and trade diversion this is true of both policy oriented economists who tend to be critical of the initiatives and theorists who have added dynamic and gametheoretic elements to the vinerian structure this paper describes the stylized facts of much recent regional integration and develops an alternative model the analysis suggests that regional integration far from threatening multilateral liberalism may in fact be a direct consequence of the success of past multilateralism and an added guarantee for its survival

multilateral stability and efficiency of trade agreements a network formation approach we study the endogenous network formation of bilateral and multilateral trade agreements by means of hypergraphs and introduce the equilibrium concept of multilateral stability we consider multi country settings with a firm in each country that produces a homogeneous good and competes as a cournot oligopolist in each market under endogenous tariffs we find that the existence of a multilateral trade agreement is always necessary for the stability of the trading system and that the formation of preferential trade agreements is always necessary for achieving global free trade we also find that global free trade is efficient but not necessarily the only multilaterally stable trade equilibrium when countries are symmetric heterogeneous in terms of market size we derive conditions under which such a conflict between overall welfare efficiency and stability occurs

what explains the proliferation of antidumping laws a recent phenomenon is the rapid spread of antidumping ad laws mainly amongst developing countries i e china india mexico between 1980 and 2003 the number of countries in the world with an ad law more than doubled going from 36 to 97 countries this proliferation of trade protection laws amongst developing countries is likely to have substantial implications for trade as recently shown by vandenbussche and zanardi 2007 the purpose of this paper is to use a duration analysis to investigate the determinants leading a country to adopt an ad law we also analyze the related question of what explains the heterogeneity between countries that can be observed in terms of the time between adoption and their first use of the ad law we find strong evidence that retaliatory motives are at the heart of the proliferation decision as countries that were targeted by ad actions of traditioal users in the past i e us eu are much more likely to adopt an ad law also our evidence suggests that past trade liberalization substantially increases the probability of a country to adopt an ad law in addition we find that the size of the chemicals sector and the extent of steel imports are positively correlated with the probability to adopt the amount of inward fdi on the other hand has a clear negative effect on the probability to adopt while short term macroeconomic factors like gdp growth and exchange rate volatility seem to matter less for adoption asymmetric regional shocks and the development level of a country seem to raise the probability of starting to use an ad law our results are robust to several specifications of duration models

what is the cause of growth in regional trade trade liberalisation or rtas the case of agriculture this paper delves into the debate on the proliferation of regional trade arrangements by focusing on bilateral agricultural trade data over the 1962 1995 period for countries that currently are members of nafta mercosur the eu and apec agricultural is chosen because it has historically been protected by developed and dis protected by developing nations while in the case of the eu its common agricultural policy was the major policy jointly managed and funded by member countries we suggest that the literature has tended to focus on factors explaining the level of trade and neglected factors affecting growth in trade while neighborhood characteristics affect neighborhood trade they also appear to affect the policy regimes of neighboring countries the shift to more outward oriented regimes is thus likely to induce a dynamic in trade among neighboring countries requiring several years to stabilize as neighborhood trade grows it is natural to form trade arrangements so as to harmonize policies and to remove other barriers if this is the case then we should expect the growth in intra regional trade to exceed growth in extra regional trade and these patterns should occur before the formation of regional trade arrangements our results support this explanation this abstract was borrowed from another version of this item

a strategic and welfare theoretic analysis of free trade areas abstract we construct a three country model to determine how the formation of free trade areas ftas affects optimal tariffs and welfare we find that at constant rest of the world row tariffs the adoption of internal free trade induces union members to reduce their external tariffs below the kemp wan j int econom 6 1976 95 97 level and causes row s terms of trade to improve and its welfare to rise when row also behaves optimally its policy response to the formation of the fta is to raise tariffs generally fta members prefer to liberalize internal trade partially and find regional integration appealing only if their collective size is sufficiently large we also demonstrate how ftas may undermine the attainment of global free trade

towards an evaluation of regional integration in latin america in the 1990s the decade of the 1990s has witnessed a wave of regional integration initiatives in latin america more than 14 agreements free trade areas or customs unions since 1990 with a handful more in varying degrees of negotiation see table 1 however this was not just a latin american phenomenon as regionalism has more than ever become a global trend mistry 1996 indeed now japan south korea and hong kong are the only world trade organization wto members which are not signatories to at least one preferential trade agreement wto 1995 regional integration is not new to latin america economic integration played an important role in the region s early post war economic history the 1960s and 1970s saw a number of very ambitious initiatives inspired by the successful western european experience ffrench davis munoz and palma 1994 indeed at its peak in the late 1960s and early 1970s the topic of integration was hard to avoid in the discussion of latin american development however disillusionment with integration processes had clearly set in by the late 1970s and the discussion of regional integration was all but silenced by the external crisis of the early 1980s this abstract was borrowed from another version of this item

preferential trade agreements and multilateral tariff cooperation are preferential trade agreements ptas building or stumbling blocks for multilateral trade liberalization i address this question in an infinitely repeated tariff game between three countries engaged in intraindustry trade under oligopoly the central result is that when countries are symmetric a free trade agreement fta undermines multilateral tariff cooperation by adversely affecting the cooperation incentive of the nonmember whereas a customs union cu does so via its effect on the cooperation incentives of members however when countries are asymmetric with respect to either market size or cost there exist circumstances where ptas facilitate multilateral tariff cooperation

stick to the fundamentals and discover your peers the use of industry as a criterion for selecting peers for multiples based valuation rests on the notion that companies operating in the same industry are more likely to share fundamental value drivers i e profitability growth and risk however such companies may not have similar characteristics in terms of these drivers and thus should not be traded at the same multiple we analyze this issue by developing the sum of absolute rank differences sard approach the sard approach can account for an infinite number of proxies for profitability growth and risk while remaining independent of industry classifications our results indicate that the sard approach yields significantly more accurate valuation estimates than the industry classification approach

the customs union issue why do we observe so few of them the number of preferential trade agreements has greatly increased over the past two decades yet most existing bilateral arrangements take the form of free trade areas and less than ten percent can be considered to be fully edged customs unions this paper develops a political economy model of trade policy under imperfect competition to provide a positive explanation for the prevalence of free trade areas in a three country setting a representative from each prospective member is elected to determine the tarifis to be applied on imported goods under a customs union the necessity to coordinate tarifis leads voters to strategically delegate power to more protectionist representatives contrary to most of the existing literature we show that strategic delegation may imply that free trade areas increase welfare compared to customs unions moreover the model also indicates that free trade areas are more likely to be politically viable than customs unions