the ambiguous impact of inequality on local resource management abstract the impact of inequality on the ability of human groups to undertake successful collective action is investigated with special reference to overexploitation of common property resources in voluntary provision problems on the one hand inequality has an ambiguous impact on the feasibility of the efficient outcome even though better endowed agents contribute more to collective action in regulated settings on the other hand inequality tends to reduce the acceptability of available regulatory schemes and therefore to make collective action more difficult

what separates us sources of resistance to globalization with increasing sophistication economists have been estimating gravity equations for five decades robust evidence shows that borders and distance impede trade by much more than tariffs or transports costs can explain we therefore advocate investigation of other sources of resistance despite the greater difficult involved in measuring and modelling them from our selective review of recent findings a unifying explanation emerges a legacy of historical isolation and conflict forged a world economy in which neither tastes nor information are homogeneously distributed cultural difference and inadequate information manifest themselves most strongly at national borders and over distance

fdi as an outcome of the market for corporate control theory and evidence abstract much foreign direct investment fdi takes the form of mergers and acquisitions m a it is commonplace in finance to view acquisitions as manifestations of the market for corporate control following on that insight we propose a model of fdi in which headquarters bid to control overseas assets we derive an equation for bilateral fdi stocks that resembles the recently developed fixed effects approach to modelling bilateral trade flows we estimate the model and use its parameters to construct benchmarks for evaluating multilateral inward and outward fdi

home biased gravity the role of migrant tastes in international trade abstract immigrants tend to buy products from their home countries as a result the more immigrants of a given ethnicity a country has the more it will tend to import from those immigrants countries of origin this effect of migrant heterogeneity is ignored by the standard gravity literature that assumes homogeneous preferences among resident consumers this paper embeds that observed regularity into a structural gravity model gravity derived from the almost ideal demand system generates bilateral trade shares with three distinct components ethnic composition of the resident population bilateral trade cost and per capita income using international trade and transnational migration data among 40 countries this paper estimates the home bias of each ethnic group in tastes the results show that consumers tastes for products from their country of origin deviate from unbiased levels by 35 percent on average ethnic taste bias is found to explain half of the trade bias counterfactuals suggest that anti immigration policy significantly impedes trade with immigrants countries of origin

rising trade costs agglomeration and trade with endogenous transaction costs while transport costs have fallen the empirical evidence also points at rising total trade costs in a model of industry location with endogenous transaction costs that seeks to replicate features from the machinery industry we show how and under which conditions a decline in transport costs can lead to an increase in the total cost of trade the subtle relationship between endogenous transport costs and the sensitivity of trade

common property equality and development the appeal of common property ideas may be traced in large measure to the fact that they seem to embody widely held values of equality on the other hand empirical examination of common property institutions reveals that they can coexist with significant inequality in this paper the relationship between common property and equality is examined it is argued that the role of common property can only be understood in the context of the associated private property institutions common property in agriculture is interpreted as part of a system based on small scale peasant proprietorship of arable land common property institutions provide a method of capturing scale economies and thereby increasing the efficiency of small scale proprietorship in competition with large scale production based on wage labor

wealth based trust and the development of collective action interpersonal trust is one possible mechanism by which wealth inequality affects the success of efforts in cooperation specifically the presence of perceived economic differences between members of small agricultural cooperatives in northwest ecuador s agricultural frontier encourages trust in the wealthy thus facilitating co op development during the initial stage of cooperative formation but such inequality and exclusive trust may later negatively affect co op success these generalizations are only possible through refinement of frameworks currently used in the study of heterogeneity and common pool resource management this refinement is made possible by paying closer attention to the operationalization of variables and by synthesizing already existing hypotheses

an elementary proof of the common maximal bid in asymmetric first price and all pay auctions we prove that the maximal bid in asymmetric first price and all pay auctions is the same for all bidders our proof is elementary and does not require that bidders are risk neutral or that the distribution functions of their valuations are independent or smooth

estimating the effects of the container revolution on world trade many historical accounts have asserted that containerization triggered complementary technological and organizational changes that revolutionized global freight transport we are the first to suggest an identification strategy for estimating the effects of the container revolution on world trade our empirical strategy exploits time and cross sectional variation in countries first adoption of container facilities and combines it with product level variation in containerizability and container usage applying our container variables on a large panel of product level trade flows for the period 1962 1990 our estimates suggest economically large concurrent and cumulative effects of containerization and lend support for the view of containerization being a driver of 20th century economic globalization

brands in motion how frictions shape multinational production following the 2016 leave vote in the referendum on uk membership in the eu and the election of donald trump trade agreements have entered a period of great instability to predict the impact of possible disruptions to existing arrangements requires counterfactual analysis that takes into account the complex set of factors influencing the production and marketing strategies of multinational corporations we estimate a model of multinational decision making in the car industry this model predicts the production reallocation and consumer surplus consequences of changes in tariffs and non tariff barriers induced by nafta termination brexit trans pacific and trans atlantic integration agreements

international trade without ces estimating translog gravity this paper derives a micro founded gravity equation in general equilibrium based on a translog demand system that allows for endogenous markups and substitution patterns across goods in contrast to standard ces based gravity equations trade is more sensitive to trade costs if the exporting country only provides a small share of the destination country s imports as a result trade costs have a heterogeneous impact across country pairs with some trade flows predicted to be zero i test the translog gravity equation and find strong empirical support in its favor

intra national trade costs assaying regional frictions abstract the effects of intra regional inter regional and international frictions on the trade flows of canada s provinces are disentangled by gravity model techniques unexplained trade barriers utbs are the difference between inter provincial trade barriers inferred from pair fixed effects and from bilateral distance and contiguity the estimates reveal large intra national trade costs and utbs that vary significantly across canada s provinces decomposition of utbs into relative border effects and a systematic residual utb is based on a novel cobb douglas aggregator of intra provincial and pure inter provincial trade costs variation of both components across provinces is big

once an enemy forever an enemy the long run impact of the japanese invasion of china from 1937 to 1945 on trade and investment abstract in this study we exploit one of the most important conflicts of the 20th century between what are currently the world s second and third largest economies that is the japanese invasion of china from 1937 to 1945 to investigate the long term impact of conflicts between countries on cross border trade and investment we find that japanese multinationals are less likely to invest in chinese regions that suffered greater civilian casualties during the japanese invasion and these regions also trade less with japan our study shows that historical animosity still influences international trade and investment despite the trend toward an increasingly globalized world

trade tastes and nutrition in india this paper introduces habit formation into an otherwise standard model of international trade household tastes evolve over time to favor foods consumed as a child the opening of trade causes preferred goods to rise in price as these were relatively inexpensive in autarky neglecting the correlation between tastes and agro climatic endowments overstates the short run nutritional gains from agricultural trade liberalization and masks potential caloric losses for laborers i examine the predictions of this model of trade with habit formation using household survey data from india both by looking across indian regions and by examining the consumption patterns of inter state migrants

the erosion of colonial trade linkages after independence high trade between countries with colonial ties may be explained by government policies that establish preferential access or as a consequence of networks formed through social interactions using bilateral trade data from 1948 to 2003 we examine the eect of independence on post colonial trade the severing of formal colonial relations can lead to an immediate reduction in trade as preferential access is eliminated as well as a gradual reduction corresponding to the deterioration of trading networks our results reveal that independence reduces colonial trade with its colonizer metropole the reduction cumulates over a 30 year period and the disruption is particularly severe for hostile separations we also find that overall colonial trade falls subsequent to independence but to a lesser extent than trade with the metropole

a contribution to a multidimensional analysis of trade competition international trade grew substantially throughout the last decades and international relations became more important for the economic performance of the countries simultaneously new poles emerged in the international arena leading to growing competition for higher market shares therefore trade competition is a critical dimension of analysis for applied international trade studies we propose a conceptual framework for measuring this phenomenon by combining some critical previous contributions to build a multidimensional and more comprehensive concept which defines trade competition as a function of the degree of both structural similarity and total exports overlap moreover structural similarity should take into account three elements sectoral shares similarity inter sectoral similarity evaluating how different the distinct sectors are and intra sectoral similarity proximity in terms of quality ranges exported several measures are proposed to empirically capture the concept suggested finally we present an example including the exports of the three largest european economies to 122 destination markets in order to illustrate the application of the concept and the measures suggested this abstract was borrowed from another version of this item

collateral damage trade disruption and the economic impact of war abstract conventional wisdom in economic history suggests that conflict between countries can be enormously disruptive of economic activity especially international trade we study the effects of war on bilateral trade with available data extending back to 1870 using the gravity model we estimate the contemporaneous and lagged effects of wars on the trade of belligerent nations and neutrals controlling for other determinants of trade as well as the possible effects of reverse causality we find large and persistent impacts of wars on trade national income and global economic welfare we also conduct a general equilibrium comparative statics exercise that indicates costs associated with lost trade might be at least as large as the conventionally measured direct costs of war such as lost human capital as illustrated by case studies of world wars i and ii

choosing rules to govern the commons a model with evidence from mexico abstract i develop a model to assess distributive rules observed in field data on 48 mexican farmer managed irrigation systems households decide whether to contribute maintenance effort the aggregate amount of which affects the level of output distributive rules with congruence between the sharing of collective costs and benefits elicit the highest level of effort empirically however incongruent rules dominate the surveyed systems i argue that transaction costs offset some efficiency benefits of congruent rules i estimate a model of rule choice inequality and the age of the water users association strongly increase the likelihood that a system chooses proportional water allocation

make trade not war this paper analyses theoretically and empirically the relationship between military conflicts and trade we show that the conventional wisdom that trade promotes peace is only partially true even in a model where trade is economically beneficial military conflicts reduce trade and leaders are rational when war can occur because of the presence of asymmetric information the probability of escalation is lower for countries that trade more bilaterally because of the opportunity cost associated with the loss of trade gains however countries more open to global trade have a higher probability of war because multilateral trade openness decreases bilateral dependence to any given country and the cost of a bilateral conflict we test our predictions on a large data set of military conflicts on the 1950 2000 period using different strategies to solve the endogeneity issues including instrumental variables we find robust evidence for the contrasting effects of bilateral and multilateral trade openness for proximate countries we find that trade has had a surprisingly large effect on their probability of military conflict

transportation costs and international trade in the second era of globalization while the precise causes of postwar trade growth are not well understood declines in transport costs top the lists of usual suspects however there is remarkably little systematic evidence documenting the decline this paper brings to bear an eclectic mix of data in order to provide a detailed accounting of the time series pattern of shipping costs the ad valorem impact of ocean shipping costs is not much lower today than in the 1950s with technological advances largely trumped by adverse cost shocks in contrast air shipping costs have dropped an order of magnitude and airborne trade has grown rapidly as a result as a result international trade has also experienced a significant rise in speed

product based cultural change is the village global we provide a model of product based cultural change where trade integration leads to cultural convergence a standard trade model of dixit stiglitz monopolistic competition is coupled with a micro founded model of cultural dynamics we show that access to varieties that are attached to a global cultural type changes the incentives of parents to socialize their children and transmit their type the resulting increase in agents of the global cultural type leads to a magnification of the initial shock a striking feature of the model is that even temporary shocks to openness may have permanent effects through the changing distribution of preferences in the economy

does the internet defy the law of gravity abstract we show that gravity holds in the case of digital goods consumed over the internet that have no trading costs therefore trade costs cannot fully account for the effects of distance on trade in particular we show that americans are more likely to visit websites from nearby countries even controlling for language income immigrant stock etc furthermore we show that this effect only holds for taste dependent digital products such as music games and pornography for these a 1 increase in physical distance reduces website visits by 3 25 for non taste dependent products such as software distance has no statistical effect

real effects of information frictions when the states and the kingdom became united abstract this paper exploits a unique historical experiment to estimate how information frictions distort international trade the establishment of the transatlantic telegraph in 1866 i use newly collected data on cotton prices trade and information flows from historical newspapers and find that the average and volatility of the transatlantic price difference fell after the telegraph while average trade flows increased and became more volatile using a trade model in which exporters use the latest news about a foreign market to forecast expected prices i estimate the efficiency gains of the telegraph to be equivalent to 8 percent of export value jel d83 f12 f14 l96 n71 n73

there goes gravity ebay and the death of distance we compare the effect of geographic distance on ebay and total international trade flows we consider the same 61 countries and basket of goods for both types of transactions we find the effect of distance to be on average 65 smaller on ebay we argue this difference is due to a reduction in search costs it increases with product differentiation and is higher when trade partners speak different languages when corruption in the exporting country is high and when uncertainty avoidance is high in the importing country moreover ebay s seller rating technology further reduces the distance effect on ebay

contracting problems and regulation the case of the fishery the inefficiencies of common property fisheries are of continuing concern to economists the early work by scott gordon 1954 and anthony scott 1955 outlined the problem and later studies by james crutchfield and giulio pontecorvo 1969 and frederick bell 1972 provided empirical estimates of the losses that result those studies were followed by the dynamic models of colin clark 1976 and james quirk and vernon smith 1970 of optimal harvest rates and the use of corrective taxes or quotas to achieve them but in spite of a large and growing literature and the persuasiveness of the outlined efficiency criteria most fisheries retain common property aspects with overcapitalization and excessive labor input why those conditions persist and the failure of the regulatory response to them are the issues addressed in this paper we examine a number of fisheries but focus on the texas shrimp industry which is one of the nation s most valuable fisheries for a single species and which shares the common property characteristics observed elsewhere it is considered overcapitalized and catch per unit of effort is falling 2 examination of the fishery reveals the many margins along which rent dissipation occurs and the nature of the regulations necessary for controlling fishing effort to avoid those losses the regulatory environment in texas is complicated by conflict within the fishery between inshore and offshore fishermen the latter assert that bay shrimping reduces the number of shrimp that successfully migrate to the gulf the inshore fishery is highlighted by another issue the recent resettlement of some 30 45 000 vietnamese refugees including many fishermen along the texas coast marine advisory service paul starr their entry has been met by hostility and violence from existing shrimpers who recognize that they are in an environment characterized by the absence of property rights bay shrimpers have lobbied the texas legislature for broad limits on new entrants yet ironically the sale of additional boats by individual shrimpers to the vietnamese has facilitated entry of the refugees into the fishery regulations in the texas shrimp and other fisheries are incomplete leaving many options for rent dissipation uncontrolled because of high contracting costs among fishermen and political factors that mold government actions contracting costs are high among heterogeneous fishermen who vary principally with regard to fishing skill 3 montana state university and texas a m university respectively we benefitted from comments by terry anderson raymond c battalio gardner brown oscar burt micha gisser wade griffin john r moroney anthony d scott peter temin and participants in workshops at texas a m university and the university of washington research assistance was provided by scott barnhart and phil mizzi funding was provided by sea grant texas a m university throughout this paper we use the terms common property and open access interchangeably here the terms describe a situation where no property rights group or individual exist s for the resource 2catch per unit of effort in the inshore texas gulf and federal gulf waters is presented for 1963 77 by w l griffin c g tydlacka and w e grant they show catch per unit of effort generally falling in inshore and offshore waters while catch per unit of effort fluctuates from year to year it falls from approximately 360 kg shrimp per unit of effort to 220 kg from 1963 to 1977 the common property nature of the fishery is reflected in the following statistics since 1975 the number of vessels has grown by 23 percent nelson swartz for fish houses the record of entry is similar between 1970 a d 1977 the number of firms grew from 259 to 287 though during that period many left the industry as others entered the number of fish houses was calculated from license data supplied by the texas parks and wildlife department the record of entry by fish houses suggests that monopsony as discussed by colin clark and gordon munro is absent in the fishery 3there may be minor differences in labor leisure choices and capital but our statistical evidence and discussions with fishermen indicate that catch variations are largely due to skill government regulations in the texas bays restrict capital and our empirical evidence shows boats to be relatively homogeneous

exposure to foreign media and changes in cultural traits evidence from naming patterns in france abstract free trade in audio visual services has faced opposition on the grounds that foreign media undermine domestic culture and ultimately global diversity using a long panel of french birth registries we assess the media culture link using name frequencies as a measure of tastes controlling for the number of people who currently have a name and unobserved name effects our regressions show that media influences choices via selective imitation parents are much more likely to adopt media names that they associate with youth using estimated parameters we simulate our model of name choice to reveal that absent foreign media fewer than 5 of french babies would have been named differently our simulations also suggest a positive effect of foreign media on the welfare of parents

globalization and the dynamics of cultural identity this paper presents a simple model where micro founded dynamics of cultural identity are endogenous and interact with an international trade equilibrium this process generates a strong home bias under autarky we then show that goods market integration causes a phenomenon of cultural divergence whereby the distributions of cultures become more dissimilar across countries and one of the cultures that existed under autarky ultimately disappears by way of contrast we show that social integration causes cultural convergence and can counterbalance the effects of goods market integration