faculty ratings of major economics departments by citations the predominant ranking criterion for judging the comparative quality of economics departments has been the faculty publication record in a set of major journals in this tradition is a recent article which generates rankings based on volume of pages published in twenty four top journals during 1974 78 philip graves et al 1982 separate rankings are calculated for total and per capita contributions and credit is accorded to the institution at which the author is employed at the time of publication 2

international control of subsidies and countervailing duties the range and number of cases of administered protection in the 1 980s suggests that it has begun to play an important role in shaping international trade flows as most of such cases are brought by the united states against developing country exporters they are also a matter of concern for developing countries in the uruguay round of trade negotiations the internationally negotiated code on subsidies and countervailing duties is ambiguous in its definition of legal subsidies and thus in the appropriate use of countervailing duties because the code is applied at the national level there is considerable pressure by domestic producers on administering agents to increase the use of such protective measures through the adoption of provisional measures while the investigation is being conducted and through the interpretation of criteria for coverage given that the most successful developing countries have been those which adopt the most neutral policies toward imported and domestic goods and between sectors domestically the very biased application of the subsidies and the trade policy distortions common in the countries examined together with the frequency of countervailing actions against the subsidies suggest that developing countries would benefit from abandonment of the subsidies in september of 1986 the world s trading nations agreed to begin a new round of multilateral trade negotiations to be called the uruguay round the previous negotiations the tokyo round ended in 1979 in the six intervening years 1980 85 seven countries and the european community eec initiated 1 155 antidumping cases there were also 425 antisubsidy cases half a hundred safeguards cases and several hundred other trade practice cases resulting from national attempts to interpret and enforce various international agreements table 1 the sheer number of such cases suggests that the terms and conditions on which goods are traded across national boundaries are being affected by the outcomes of such administrative processes as much as by the gradual unrolling of the tariff reductions agreed at the tokyo round the general agreement on tariffs and trade gatt and the codes which

is development path dependent or political a reinterpretation of mineral dependent development in botswana abstract poor management of earnings from valuable natural resources results in a syndrome known as dutch disease characterised by real exchange rate appreciation high labour costs and structural imbalances in economic development often a product of rentier politics dutch disease undermines long term economic performance in resource dependent economies resulting in a resource curse the conventional wisdom argues that institutions and state development at the time of a resource boom lock countries into divergent developmental trajectories i argue that political coalitions lay the foundation for development of state and other institutions and that changes in coalitions drive changes in policy responses to resource booms botswana s experience illustrates the argument botswana has not entirely avoided symptoms of dutch disease but has kept them largely in check despite the fragility of state institutions when diamonds were discovered a broad and stable political coalition during the first decade

are hazard models superior to traditional bankruptcy prediction approaches a comprehensive test abstract in recent years hazard models using both market and accounting information have become state of the art in predicting firm bankruptcies however a comprehensive test comparing their performance against the traditional accounting based approach or the contingent claims approach is missing in the literature using a complete database of uk main listed firms between 1979 and 2009 our receiver operating characteristics roc curve analysis shows that the hazard models are superior to the alternatives further our information content tests demonstrate that the hazard models subsume all bankruptcy related information in the taffler 1983 z score model as well as in bharath and shumway 2008 contingent claims based model finally using a mixed regime competitive loan market with different costs of misclassification the economic benefit of using the shumway 2001 hazard model is clear particularly when the performance is judged with return on risk weighted assets computed under basel iii

rankings methodology for international comparisons of institutions and individuals an application to economics in australia and new zealand abstract the objectives of this paper are threefold first we critically survey and analyse the different methodologies that have been adopted in the rankings literature second using journal articles included in the econlit database and on the basis of two criteria one based on citations and the other on perceptions of journal quality we rank economics teaching departments in australia and new zealand for 1988 2002 and 1996 2002 and for individual academic economists for the periods 1988 2002 1988 1995 and 1996 2002 furthermore we identify individual star performers and recognize them in a designated hall of fame for 1988 2002 third our methodology enables us to make international comparisons on total and per capita bases previous multi country ranking studies in economics do not rank economics departments they provide rankings based on total publications in economics in universities regardless of whether the economists are in the economics departments or in other departments thus no rankings on per capita bases are provided we correct this shortcoming by providing total and per capita rankings and analysing the correlations between total and per capita rankings this is the first study to examine whether the size of the economics department matters with regard to productivity

the resource curse revisited governance and natural resources the paper analyzes the impact of natural resource abundance on selected governance indicators we use a panel data set with observations on a large number of countries over an extended period of time and employ an instrumental variable technique to account for endogeneity the results show that exports of natural resources have above all led to an increase in corruption this result is robust to both different model specifications and an alternative indicator for natural resource abundance for other governance indicators such as law and order and bureaucratic quality we either find no results or results that lack robustness

opec and the international oil market can a cartel fuel the engine of economic development abstract the opec cartel was formed to promote two economic goals one microeconomic low oil market volatility the other macroeconomic promotes economic development of its members these goals create a tension since the cartel s single tool is output quotas using this dual micro macro perspective we analyze oil exporting countries behavior we find that the effects of the cartel s choices will be reflected in oil market stability long term macroeconomic development and international oil market structure if an oil producing country cares about both oil industry profits and macroeconomic stability the goal of output stability may be inconsistent with cartel membership

international transfer of localized technology and factor income in the ricardo viner trade model the implications of transferring a superior technology localized at foreign factor proportions are examined within the context of the ricardo viner model we show that such a technology transfer decreases the wage rate and labour demand in the recipient country as well as affecting significantly other properties of the ricardo viner model for instance the neoclassical ambiguity concerning the effect on the real wage of a change in the relative commodity price disappears and an increase in a factor endowment need no longer depress the price of the expanding factor le transfert international d une technologie localisee et le revenu desfacteurs deproduction dans le modee ricardo viner du commerce international l auteur examine les impacts d un transfert de technologie etrangere localise e avec ses ratios de facteurs de production dans le contexte d un modele a la ricardo viner on montre qu un tel transfert de technologie reduit le taux de salaire et la demande de travail dans l economie receptrice en plus d affecter de maniere significative d autres proprietes du modele ricardo viner par exemple l ambiguite neo classique quant a l effet d un changement dans les prix relatifs des biens sur le niveau de salaire reel disparait et i accroissement dans la dotation d un facteur n entraine plus la chute du prix du facteur

pricing default swaps empirical evidence in this paper we compare market prices of credit default swaps with model prices we show that a simple reduced form model outperforms directly comparing bonds credit spreads to default swap premiums we find that the model yields unbiased premium estimates for default swaps on investment grade issuers but only if we use swap or repo rates as proxy for default free interest rates this indicates that the government curve is no longer seen as the reference default free curve we also show that the model is relatively insensitive to the value of the assumed recovery rate

the return of the reciprocitarians us trade policy today we are always willing to be trade partners but never trade patsies president ronald reagan state of the union message washington 1987

dutch disease effect of oil rents on agriculture value added in middle east and north african mena countries abstract this paper investigates the effect of oil rents on agriculture value added in oil producing middle east and north african mena countries annual data from 1970 to 2011 panel cointegration tests by pedroni 1999 long ran panel causality tests by canning and pedroni 2008 and two step system gmm by blundell and bond 1998 are used in this study we find a negative relationship between oil rents and agriculture value added in the long run with a rather slow rate of short run adjustment of agriculture value added back to equilibrium after a boom in oil rents these results indicate that an oil sector boom is associated with a contraction in the agriculture sectors of the countries in the panel in the long run this is probably attributable to a resource movement effect from other economic sectors to the booming oil sector in these countries this serves as evidence of a dutch disease effect of an oil sector boom on agriculture in the mena countries in this study

natural resources and internal conflict we present a model of conflict in which each group decides to claim the country s income and invest in arms or to accept a group neutral allocation of income and not invest in arms apart from the usual cooperative or conflictual societies their strategic choice can result in hierarchically stratified societies in which one group is dominant we show how the presence and exploitation of certain types of resources matters for the occurrence of conflict or social hierarchical stratification and for the possible effects of trust manipulation in particular we find that first robust encompassing point and lootable resource rich economies tend to be conflictual plantation economies hierarchically stratified and diversified economies cooperative second foreign intervention aimed at changing the balance of power in the case of conflict is most effective in robust and diffuse resource rich economies third trust manipulation as a means to counter conflict is most effective in subsistence and diffuse resource rich economies throughout the article we cite ample case study and econometric evidence to support our model

the political economy of resource driven growth abstract in recent decades resource poor countries have out performed resource abundant ones a stylised facts model of competitive industrialisation describes the long run development of a resource poor country with a political state that is developmental only minor change is required to adapt the model to trace the development trajectory of a resource abundant country with a similar political state however most resource abundant countries engender a political state that is factional or predatory and distorts the economy in the pursuit of rents a staple trap model describes the development trajectory under these conditions the model predicts a growth collapse from which recovery is protracted especially for small economies that lack a niche trade link with a large economy

an ecological economic assessment of deregulation of international commerce under gatt this paper discusses the ecological economic implications of deregulation of trade as promoted by the general agreement on tariffs and trade gatt 1 this includes both environmental2 and socio economic factors such as standards of living and equity we outline fifteen overlapping problems with deregulation or free trade we argue that many environmental problems cannot be resolved equitably efficiently or sustainably by unregulated markets and that there is no alternative to public intervention in certain situations we repeat the 1987 brundtland commission s question of how far into international trade should regulation penetrate wced 1987 the commission s call for gatt s environmental reform 3 has not yet been heeded

trends in rankings of economics departments in the u s an update economics departments in the u s are ranked based on 1 the number of pages published in thirty six economics journals 2 publications in five of the top journals 3 output per faculty member and 4 an index of the concentration of research in a department evidence shows that the top twenty departments have generally retained their positions since the 1970s but rather large changes have occurred in departments ranked from 240 to 100 an economists hall of fame is developed listing the top fifty individual producers of research in the thirty six journal set and the top five journals

trading strategies with implied forward credit default swap spreads credit default risk for an obligor can be hedged with either a credit default swap cds or a constant maturity credit default swap cmcds we find strong evidence of persistent differences in the hedging cost associated with the two comparable contracts between 2001 and 2006 it would have been more profitable to sell cds and buy cmcds while after the crisis between 2008 and 2013 the opposite strategy was profitable panel data tests indicate that for our sample period the implied forward cds rates are unbiased estimates of future spot cds rates the changes in the company implied volatility is the main determinant of trading inefficiencies followed by the changes in gdp and in the interest rates before the crisis and the changes in sentiment index and in the vix after the crisis

contesting resources rent seeking conflict and the natural resource curse a growing empirical literature links natural resource abundance and pointiness to impeded economic growth and civil strife we develop rent seeking and conflict models that capture the most salient features of contests for resource rents and show how both resource abundance and geographical clustering can be associated with intense contests and sub optimal economic performance however we also show that these relationships are not necessarily monotonous pointiness can trigger more intense contests but can also facilitate the coordination on peaceful outcomes finally we show that contesting resources through violent conflict may yield superior outcomes from an economy wide perspective than contests through rent seeking

large is beautiful the welfare effect of technology transfer reconsidered abstract this paper demonstrates that a technology transfer via foreign owned firms always reduces the host country s national income if the new technology is localized in the atkinson stiglitz sense at a capital labor ratio higher than prevails locally although developing countries can mitigate this negative impact of technology transfer by restricting the activities of foreign firms we argue that complete capital market liberalization yields even higher national income

re inventing dualism policy narratives and modes of oil palm expansion in sarawak malaysia the policy narrative underpinning the current rapid expansion of large scale private oil palm plantations in sarawak malaysia implies a dualistic conception of the agrarian transformation underway such as prevailed in the 1950s this narrative is inconsistent with the history of smallholder commercialisation in sarawak post 1981 policy has sought to limit smallholder development and deliver large land areas to private estates thus re inventing a dualistic agrarian structure oil palm expansion in sarawak has various potential pathways and is driven in its present direction not by dualistic economics but the exercise of state power to maximise opportunities for surplus extraction and political patronage

resource intensity institutions and development summary we examine the relationship between resource abundance and several indicators of human welfare consistent with the existing literature on the relationship between resource abundance and economic growth we find that given an initial income level resource intensive countries tend to suffer lower levels of human development while we find only weak support for a direct link between resources and welfare there is an indirect link that operates through institutional quality there are also significant differences in the effects that resources have on different measures of institutional quality these results imply that the resource curse is a more encompassing phenomenon than previously considered and that key differences exist between the effects of different resource types on various aspects of governance and human welfare 2005 elsevier ltd all rights reserved

a worldwide assessment of scientific production in economics 1992 1997 the aim of this article is to analyse the worldwide production in economics to that end bibliometric indicators are constructed by way of a database made up of 55 international journals covering the period 1992 1997 a ranking of the leading thousand international affiliations is established and quality indices of the first 200 are presented finally a detailed analysis is carried out at country level and with respect to the 12 leading countries

china india and the commodity boom economic and environmental implications for low income countries the international role of china has risen steadily for two decades and has become even more important in the current global recession the growing supply of labour intensive manufactured exports from china has been accompanied by a huge expansion in its imports both of raw materials and of skill intensive manufactured parts and components this offshoring of intermediates production by a large labour abundant economy has economic and environmental implications for other developing economies more recently the rapid expansion of the indian economy and trade indicates that it too will soon exert similar effects on global markets we sketch a model showing how the growth of these developing country giants generates adjustment pressures on other developing economies we discuss in particular how differences in relative factor endowments of resource rich economies can produce quite different outcomes in the context of product fragmentation and expanding commodity trade we also explore the effects on production trade environment and prospects for future growth in resource rich economies particularly in the context of weak institutions and other market failures we illustrate these different impacts by considering the cases of indonesia malaysia and thailand and highlight implications for growth development and policy

testing for forward rate unbiasedness on regression in levels and in returns several recent empirical studies have been forced to reject exact 1 1 cointegration between spot and forward exchange rates theoretically this is shown to provide a possible explanation for the puzzling negative estimates reported from spot return forward premium regressions in particular the coefficient in this regression has a unit root component in its limit distribution that imparts a bias and skewness to the estimator simulations are used to demonstrate how even very small deviations from 1 1 cointegration can result in substantial bias the empirical evidence suggests that the implied dickey fuller type terms do exhibit a downward bias yet are of insufficient magnitude to fully account for the puzzling regression coefficients mentioned above

revealed performances worldwide rankings of economists and economics departments 1990 2000 in this paper i study the production of academic research by economics departments and economists worldwide rankings are provided based on both citations and publications these rankings reveal a dominant position of the united states in the production of economics literature over time however the extent of this dominance is decreasing jel a10 a14

researcher rank stability across alternative output measurement schemes in the context of a time limited research evaluation the new zealand case abstractthis article focuses on the stability of rankings of academics by research productivity in the context of short term decision making in particular the growing use of national research assessment exercises nrae has increased interest in identifying the contributions of individual researchers to an assessment unit s output and ranking the article concentrates on the assessment of individuals using plausible journal ranking schemes we find that despite statistical evidence of a high degree of stability across journal ranking schemes as indicated by rank correlation coefficients the particular ranking scheme used is of great importance to individual researchers this applies with particular force to academics working within a nrae environment based on individual assessment such as new zealand s pbrf

the relative impacts of economics journals 1970 1990 our data collection and database assembly efforts were assisted by john p sophocleus mark gwartney michele butler and scott ralston we received extremely valuable computer programming assistance from jon brunson and edward novak constructive comments were receivedfrom two anonymous reviewers financial supportfrom the faculty development committee at salisbury state university is gratefully acknowledged

new issues in the uruguay round and beyond the general agreement on tariffs and trade gatt is a treaty establishing a framework of rules and principles for policies affecting merchandise trade it also provides a forum in which sovereign states periodically engage in reciprocal trade liberalisation and rule making 2 as a result of substantial reductions in tariffs through periodic rounds of multilateral negotiations rule making has gradually become as if not more important than liberalisation per se starting with the kennedy round i964 7 but especially in the tokyo i973 9 and uruguay i986 rounds an increasing number of agenda items involved the negotiation of rules and disciplines for specific trade related domestic policies rather than further reductions in tariffs and other border measures rules pertaining to product standards subsidies and government procurement were prominent items on the agenda of the tokyo round the uruguay round further expanded the multilateral negotiating agenda by adding trade related investment measures trims trade related intellectual property rights trips and measures affecting the contestability of service markets the trend for multilateral trade negotiations to address domestic policies shows no sign of abating calls for a post uruguay round negotiation have identified issues such as competition policy foreign direct investment fdi regulations innovation policies and the interaction between trade and environmental policies as possible topics for discussion 3 in part the steady agenda expansion reflects changes in the structure of the global economy the managerial and technological innovations of the last decade such as just in time inventory management and the increased tradeability of services created pressures for greater specialisation and geographical splintering of production this in turn made regulations pertaining to services fdi transfer of technology and protection of intangible assets more important for both governments and firms flows associated with services fdi and intellectual property ip are smaller than merchandise trade but are quite substantial table i reveals that global merchandise trade in i990 was 3 5 trillion while world trade in commercial services was about 820 billion global receipts for ip were some 33 billion and income flows

summing up on the australian case for protection in 1929 a quasi official report by several eminent australian economists the australian tariff an economic inquiry by j b brigden d p copland e c dyason l f giblin and c h wickens set off analytical controversy that has helped shape the discovery of what has come to be known as modern international trade theory i had thought that this whole topic was satisfactorily understood by informed scholars and could be honorably deposited on the shelf of closed history g j manger 1976 has however uncovered some interesting puzzles since marion crawford samuelson who played a key role forty years ago in the theoretical developments is not here to consult on doubtful matters of memory i recently spent an afternoon in the harvard college libraries reviewing the principal scholarly contributions quite aside from manger s interesting issues the exercise was a rewarding one for here is a drama that involved many of the great names of our subject ricardo 1815 1823 and malthus 1815 torrens 1815 and stuart mill 1848 sidgwick 1883 edgeworth 1897 and bastable 1897 and i seem to recall nicholson and carver simon patten 1890 and taussig marshall 1879 and pigou 1906 as well as allyn young 1913 knight 1924 and robertson 1924 brigden 1925 1927a 1927b benham 1926 1927 1935 copland 1931 and frank graham 1923 heckscher 1919 and ohlin 1933 stolper and paul samuelson 1941 samuelson 1938 1939 as well as lerner 1952 and metzler 1949a 1949b karl anderson 1938 1939 and marion crawford samuelson 1939 corden 1957 reitsma 1958 1960 bhagwati and johnson 1961 vanek kemp and ronald jones 1962 and many others the story is worth telling both in its received and revised versions

corruption and reduced oil production an additional resource curse factor prominent contributions to the resource curse literature suggest weak governance and corruption are important factors behind the wide welfare variations observed among oil producing countries how weak governance and corruption influence revenue management and expenditure decisions as well as the possible welfare benefits derived from oil are broadly discussed how they impact upon volumes of oil produced has however attracted little attention this paper combines a review of the resource curse and oil production literatures with findings from qualitative interviews with oil sector experts to appreciate the feasibility of connections between corruption and oil production below its potential we make particular reference to environments where regulatory institutions or political accountability are weak and focus primarily on producer government and oil firm relations drawing on insights from geology political science and economics we suggest suboptimal production solutions can impact volumes of oil actually produced and create constraints on long term revenues for oil producing countries we argue greater disclosure of information on oil production efficiency on a field by field and country by country basis will assist further investigation of the relationships between corruption and volumes of oil produced

a reconsideration of the welfare economics of a free trade zone abstract this paper presents a model of a free trade zone which incorporates the fact that such zones are often established by government subsidies designed to promote non traditional exports in our model the condition is derived under which the establishment of a free trade zone can increase welfare regardless of the relative factor intensity of a zone based industry however the relative factor intensity of a free trade zone plays a crucial role in determining the change in welfare following economic growth and foreign investment

learning by doing changes in industrial structure and trade patterns and economic growth in a small open economy abstract this paper presents a simple dynamic model which allows for changes in both industrial structure and trade patterns during the process of economic growth learning by doing in the producer service sector is the source of endogenous growth interesting interdependences between economic growth and the structure of the economy are obtained economic growth is accompanied by changes in industrial structure and comparative advantage while changes in industrial composition of the manufacturing sector accelerate economic growth furthermore this paper analyzes the relationship between economic growth and the endowment structure and the effects of two types of technology transfers on economic growth

rationality of survey data and tests for market efficiency in the foreign exchange markets abstract this paper tests the rational expectations hypothesis reh and the market efficiency hypothesis meh in the foreign exchange markets using survey data on expectations our results show that the spot exchange rates expected exchange rates and the forward rates all follow a random walk process hence the cointegration theory is employed to test the reh and meh all the test statistics support the reh but fail to support the meh we use survey data on expectations to identify the causes behind this failure of the meh jel f31 g14

the general validity of the heckscher ohlin theorem despite a number of attempts to extend it the heckscher ohlin theorem remains woefully restricted in terms of the generality of the assumptions needed for its proof in its traditional form as a statement about the commodity composition of trade the theorem is valid only in the highly abstract environment of the two factor two good twocountry model that has been the mainstay of trade theory for half a century a weaker version of the theorem involving the factor content of trade rather than its commodity composition has been proved for any number of factors goods and countries but this generality has so far been bought only at the cost of other and perhaps equally restrictive assumptions 2 the purpose of this paper is to provide statements and proofs of the heckscher ohlin h o theorem that are more general than those currently available the approach taken is similar to that used in my 1980 article for an extension of the theory of comparative advantage in terms of correlations between autarky prices and trade in section i i lay out the assumptions on which the analysis is based these assumptions provide the outlines of a reasonably general model in which there may be any numbers of goods and factors and in which factor prices may be equalized or not trade impediments in the form of tariffs or export taxes are permitted though transportation costs are not 3 in section ii i discuss the difficulty of inferring the factor content of trade in a world of unequal factor prices and i provide several alternative definitions of that concept for use later in the paper these together with the assumptions of section i are used in section iii to prove a theorem on the value at autarky prices of the factor content of trade in section iv this theorem is used to prove a first corollary that makes a more direct statement about the pattern of trade it says that worldwide there must be a negative correlation between the factor content of trade by factor and country and the corresponding autarky factor prices it is precisely these autarky factor prices that constitute the ohlin measure of factor scarcity therefore the corollary provides a formal statement of the general idea that countries tend to export the services of those factors which they have in relative abundance and it may be regarded as a generalization of the factor content version of the h o theorem finally a generalization of the commodity version of the theorem is proved in section v the concept of a covariance is generalized university of michigan i have benefitted greatly from the comments of paul degrauwe wolfgang mayer michael mussa carl simon and robert stern as well as others who participated in seminars at the universities of michigan chicago and cincinnati and at the national bureau of economic research an anonymous referee also made valuable comments with additional goods and factor price equalization the theorem runs afoul of the indeterminacy of production and trade noted by paul samuelson 1953 and james melvin 1968 without factor price equalization trade impediments and intermediate production can cause reversals of the pattern of trade as shown in my 1979 article if additional factors and countries are also added it becomes difficult even to state the theorem let alone to prove it 2melvin stated such a theorem for the three good two factor case and jaroslav vanek 1968 proved it for the general case but only by assuming factor price equalization trent bertrand 1972 and jon harkness 1979 were able to drop the factor price equalization assumption but replaced it with restrictions on consumption of either goods or factors by country of origin it is unclear to me however that these restrictions can ever be met in a model that is otherwise plausible harkness 1978 has also used the factor content version of the theorems as the motivation for a regression equation relating commodity trade to factor intensities this bears some resemblance to my analysis below in section v see however james anderson 1981 and edward leamer and harry bowen 1981 who have criticized his result with a reply by harkness 1981 3for ease of exposition i do not allow here for transportation costs these were included in an earlier version of this paper following the technique in my 1980 article

tariffs foreign capital and national welfare with sector specific factors abstract this paper examines the effect on national welfare of an endogenously determined inflow of foreign capital in the context of a well known model with sector specific inputs both for the case of unrestricted international trade and investment and in the presence of a tariff the second best problem of the optimal tax on foreign investment for a given tariff level is also investigated by application of the concept of shadow prices for primary factors in distorted open economies the results obtained are then related to analogous propositions derived previously for the standard heckscher ohlin model

justice to the australians my acknowledged debt to gary j manger is so great that i fear to register any dissent lest i seem an ingrate therefore i stay with a few truths that relate to his concerns 1 1 by 1920 it was high time to replace the labor only model of ricardo mill classicism by the formal ohlin haberler and other multi factor extensions already ricardo torrens and malthus recognized that the corn laws could raise landowners share in english national income a phenomenon not relevant to the 1 factor only formal model the 1925 1931 australian discussions similarly deviated into good sense before international trade theory had in manger s happy phrase shifted intellectual gears tom kuhn must realize that in real life scientists work with more than one paradigm at a time including some still getting born and perceived 2 ohlin s recognition of oversimplification in purchasingpower theory will be seen on reflection to be logically and empirically unrelated to the inadequacies of the labor only models similarly mill s recognition that international values cannot accord with labor values is not a point against a model involving labor alonein each country it is a valid deduction about such a classical model in short as kuhn can document a new and better paradigm may be motivated by criticisms of an old paradigm that are themselves confused and even wrong 3 frederic benham s 1935 paper on how factor prices and goods prices are related is a quantum advance in the post heckscher literature his jousts with bridgen on marion samuelson s problem do not win for him from me manger s high marks but when have teachers been unanimous in making out report card grades 4 manger earns our praise for throwing new light on basic advances in the theory of international trade my reservations which are minor hope to guard against awarding excessive credit to post1938 writers

natural resources institutional quality and economic growth in china the resource curse has been mainly studied using cross country samples in this paper we analyze a cross province sample from one country china we focus on the interplay between resource abundance institutional quality and economic growth using two different measures of resource abundance a stock resource reserves and a flow resource revenues and employing various econometric approaches including varying coefficient models we find that resource abundance has a positive effect on economic growth at the provincial level in china between 1990 and 2008 an effect that depends nonlinearly on institutional quality 1995 confidence in courts the west china development drive policy initiated in 2000 caused substantial changes which we investigate through a comparative panel data analysis

trade protectionism in australia its growth and dismantling protection from import competition was a defining feature of the birth of the australian federation in 1901 for the next 70 years the extent of protection grew and broadened from mainly tariffs to also involving import licencing after world war ii there was a one off 25 across the board cut in tariffs in 1973 and some dismantling of agricultural subsidies but that was followed by the re imposition of import quotas for the most protected manufactured goods then in the mid 1980s a new reformist government began a long process of dismantling all protection as part of an overall economic reform program that also involved de regulation privatization and moving to a flexible exchange rate the rewards included three decades of faster economic growth and an unprecedented rise in australians living standards this paper provides a history of economic thought on the pros and cons of protectionism for the small distant natural resource rich australian economy and a survey of the literature on the extent effects and political economy reasons behind the growth of australian protection and its eventual dismantling

environmental degradation as engine of undesirable economic growth via self protection consumption choices we analyze growth dynamics in an economy where the well being of economic agents depends on three goods leisure a free access environmental good and a private good that can be consumed as a substitute for the environmental resource the processes of production and consumption of the private good by each agent impose negative externalities on other agents through the depletion of the environmental good this paper shows that in such context the existence of private substitutes for environmental goods may fuel an undesirable economic growth process this process is driven by the continuous increase in agents needs for private consumption generated by the progressive reduction in free consumption of the environmental good

minerals institutions openness and growth an empirical analysis competing explanations of the resource curse are tested using panel data the data support the existence of a mineral resource curse for developing countries with weak institutions consistent with the hypothesis that owners of mineral resources use weak institutions and openness to trade to stifle the development of human capital to the detriment of growth in other sectors of the economy manufacturing imports substitute for the development of domestic production so openness to trade correlates with lower growth in mineral dependent economies the dutch disease and debt overhang explanations of the resource curse are not supported

industrial policy reform in six large newly industrializing countries the resource curse thesis abstract all six large newly industrializing countries nics in this study favored an autarkic industrial policy aip in the 1950s aip required however the rapid build up of heavy and chemical industry hci which caused foreign exchange shortages if the hci matured slowly this is because the import and subsidy demands of the growing protected hci sector became too burdensome for the competitive primary sector whose rents shrank in relative importance as the economic structure evolved the two least well endowed nics abandoned aip early in favor of a competitive industrial policy cip which relied on labor intensive exports to earn foreign exchange and resulted in rapid economic growth in contrast the resource bonus of the four best endowed nics sustained aip longer but the longer aip lasted the harder it became to reform and the slow maturing hci sector adversely affected economic growth in this way the resource bonus became a curse rather than a blessing

funds from non renewable energy resources policy lessons from alaska and alberta abstract we document the use of energy natural resource funds in alaska and alberta and analyze theirs characteristics for further implementation in resource rich countries such funds allow dealing theoretically with intergenerational equity issues corruption and more general institutional problems the performance of both funds is very different depending on the management and composition choices but some policy lessons can be drawn from these two examples importantly the role of a public dividend policy is highlighted as a way to bypass corrupted institutions and to enhance quality of life for poorest people we also emphasize the need to deal with inflation to make the fund sustainable

corruption and the political economy of resource based development a comparison of asia and sub saharan africa we model how the supply and demand for bribes affects resource use by an economy and the reinvestment of resource rents in other assets this requires adjusting the world bank s measure adjusted net savings for any rent dissipation due to corruption the impacts of corruption on long run changes and periodic growth in the adjusted net savings rate are estimated across african and asian economies from 1970 to 2003 corruption rather than resource dependency per se affects negatively the ability of african countries to reinvest resource rents in the short term but for asian countries corruption is less important than point resources corruption influences long run growth in adjusted net savings rates in all countries and is also the pathway through which this growth is affected by patterns of resource use trade and abundance

measuring the importance of oil related revenues in total fiscal income for mexico revenues from oil exports are an important part of government budgets in mexico a time series analysis is conducted using monthly data from 1990 to 2005 examining three different specifications to determine how international oil price fluctuations and government income generated from oil exports influence fiscal policy in mexico the behavior of government spending and taxation is consistent with the spend tax hypothesis the results show that there is an inverse relationship between oil related revenues and tax revenue from non oil sources fiscal policy reform is urgently needed in order to improve tax collection as oil reserves in mexico become more and more depleted

how much influence do economics professors have on rankings the case of australia and new zealand this study ranks australian and new zealand economics teaching departments on the basis of the research productivity of its economics professors in economics teaching departments using quality adjusted journal articles listed on the econlit database for the periods 1988 to 2002 and for 1996 to 2002 the per capita research productivity of professors is highest for university of melbourne university of western australia and university of canterbury for a number of economics departments the per capita research productivity is lower than the research productivity of all faculty members using a number of criteria for 1988 2002 and 1996 2002 these universities are university of auckland royal melbourne institute of technology university griffith university and macquarie university

the trade and welfare impact of australian quarantine policies the case of pigmeat we analyze the trade and welfare impact of quarantine measures imposed by australia on imports of pigmeat in particular we account for changes to australia s pigmeat quarantine policy over time including those changes related to the recent resolution of a wto dispute between australia and the european union using a random utility model and applying it to corner solutions in import decisions tariff equivalents by major trading partner are estimated for the different pigmeat quarantine regimes implemented by australia during the period 1988 2009 the welfare impact on consumers producers and foreign exporters is computed using a partial equilibrium model calibrated on the econometric estimates the quarantine regimes have a strong effect on trade and welfare with a tariff equivalent above 113 of average real world prices over the period analyzed

boom or gloom examining the dutch disease in two speed economies traditional studies of the dutch disease do not account for productivity spillovers between the booming resource sector and other domestic sectors we put forward a simple theory model that allows for such spillovers we then identify and quantify these spillovers using a bayesian dynamic factor model the model allows for resource movements and spending effects through a large panel of variables while also identifying disturbances to other shocks using australia and norway as representative cases studies we find that a booming resource sector has substantial productivity spillovers on non resource sectors effects that have not been captured in previous analysis

credit swap valuation this review of the pricing of credit swaps a form of derivative security that can be viewed as default insurance on loans or bonds begins with a description of the credit swap contract turns to pricing by reference to spreads over the risk free rate of par floating rate bonds of the same quality and then considers model based pricing the role of asset swap spreads as a reference for pricing credit swaps is also considered

advancing the design of a dynamic petro dollar currency basket this study offers organization of petroleum exporting countries opec member nations a crude oil pricing currency basket based on currency liquidity in contrast with prior emphasis on opec trading patterns motivating the search for an alternative us dollar pricing of crude oil is the significant and inverse relationship r 0 82 p 0 01 between the us dollar major currencies index and crude oil price over the period january 1999 march 2009 a dynamically weighted petro dollar currency basket is proposed based on the five currency claims us dollar euro british pound japanese yen and swiss franc and their varying proportions of foreign exchange reserves held by central banks the major currencies us dollar index is compared against the proposed petro dollar index to reveal an average us 8 1 billion annual gain in favor of the petro dollar currency basket offering opec members a revenue stream of diversified and highly liquid currencies to transition away from complete dependence on the us dollar crude oil pricing the proposed petro dollar crude oil pricing schema offers opec a crude oil price dynamically denominated in currencies reflecting the global use and importance of crude oil this paper concludes with implementation issues facing a move toward the dynamically weighted petro dollar crude oil pricing schema

common stochastic trends in a system of exchange rates univariate tests reveal strong evidence for the presence of a unit root in the univariate time series representation for seven daily spot and forward exchange rate series furthermore all seven spot and forward rates appear to be cointegrated that is the forward premiums are stationary and one common unit root or stochastic trend is detectable in the multivariate time series models for the seven spot and forward rates respectively this is consistent with the hypothesis that the seven exchange rates possess one longrun relationship and that the disequilibrium error around that relationship partly accounts for subsequent movements in the exchange rates a general consensus has emerged in recent years that many macroeconomic time series such as gnp consumption expenditures disposable income etc can be characterized by a stochastic trend model in particular nelson and plosser 22 described this property as one of being difference stationary so that the first difference of a time series is stationary an alternative trend stationary model where a stationary component is added to a deterministic trend term has generally been found to be less appropriate 1 similarly it has long been recognized that many financial time series such as foreign exchange rates are nonstationary e g in meese and singleton 21 the issue of nonstationary is not merely a statistical curiosity but has several important implications for the modeling of exchange rates for instance many models of exchange rate determination under rational expectations require stationarity assumptions when solving out the expected future values of the fundamentals further there has been some controversy over the appropriate transformations to use when conducting tests of whether the forward rate is an unbiased and efficient predictor of the future spot exchange rate 2 some authors e g frenkel 11 12 have conducted tests in levels while geweke and feige 14