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Questions tagged [international-trade]

International trade theory is a sub-field of economics which analyzes the patterns of international trade, its origins, and its welfare implications.

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Are there economic models that predict (only) a medium/long-term negative effect of protectionism?

Going by some ECB models/estimates from last year, protectionism would result in negative consequences pretty fast, e.g. For illustration, I will use the results of simulations carried out by ECB ...
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Are there political economy models that include a “majority capture” of (protectionist) trade policy?

A highly cited model of protectionism is the "protection for sale" model or Grossman and Helpman. (For an [updated] evaluation of that model see for instance the Advanced International Trade textbook ...
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International emissions trading

As far as I have understood emission right certificates are some kind of currency. Each company may emit as much of say CO2 as its certificates allow. Certificates may be traded, i.e. bought and sold. ...
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why US don't like China trade deficit? [duplicate]

Because of the dollar, US basically have unlimited credit. US could simple print money for good. Why US don't like China trade deficit? If US is a person, and the person could use paper to exchange ...
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Is it unreasonable to expect a country with a large public deficit and the world's reserve currency to not run trade deficits with other countries?

I have heard that country trade deficits are primarily driven by excessive consumer spending and large public deficits, and that having the world's reserve currency means that you will have to run ...
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In practice, are retaliatory tariffs the first step (or among the first steps) in the WTO dispute resolution process?

In theory, retaliatory tariffs probably aren't first step in the WTO dispute resolution process. Instead, the dispute is supposed to go through consultations, which take some 6.6-months on average, ...
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Is IP theft more severe in China than in other developing countries?

Why is the media making such a big deal over IP theft in China if it's not more severe than in other developing countries? So is it the case that IP theft is more severe in China than in other ...
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According to the U.S., what constitutes as fair subsidies?

The U.S. asked China to do this during the trade negotiations: China immediately will cease providing market-distorting subsidies and other types of government support that can contribute to the ...
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Are there agreements in place between the EU and the US to facilitate trade in services?

What agreements are in place between the EU and the US to facilitate trade in services?
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Are tariffs ever levied on services and does MFN apply?

I am interested in tariffs on services. Are tariffs ever levied on services and do most-favoured nation rules apply as they do with goods?
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How is trade in services conducted under the WTO in the absence of the Doha conclusion?

The Doha round of negotiations for the WTO had a focus on services, but that round has not been concluded. Does that mean that trade in services between trading partners without a preferential trade ...
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Definition of Heckscher-Ohlin free trade equilibrium

Does anyone know the mathematical definition of the Heckscher-Ohlin free trade equilibrium? Using real analysis methods!
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Discrepancy of GDP and International Transaction Releases for Exports

The Bureau of Economic Analysis ("BEA") provides consolidated data from several different government agencies. Currently they provide exports under both a Gross Domestic Product ("GDP") release as ...
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Would PPP adjustments between countries be irrelevant if all countries had the same relative prices?

I'm trying to understand the relationship, if any, between the fact that countries have different relative prices (e.g. different 'food price-to-general consumer prices' ratios) impacts the need for ...
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GDP per capita and trade relationship

There's a lot of literature describing the relationship between growth and trade, but I'm not sure what conclusions I can draw from GDP per capita (specifically) and trade in one particular year for ...
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Where can I find a complete list of goods affected by NAFTA?

I am looking for the list of goods that NAFTA, preferably in the format of what is subject to tariff reduction. I have found a few potential leads, but none seem to be exhaustive: https://www....
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A valid argument against free trade?

Recently I read Bertrand Russell's Political Ideals (1917). Although he expresses strong left-wing ideals there, he supports free trade and criticizes protectionism. It seems that not any left-wing ...
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“Increasing trade barriers causes a country’s currency to appreciate”?

Mishkin (2016, p. 476) writes: Barriers to free trade such as tariffs (taxes on imported goods) and quotas (restrictions on the quantity of foreign goods that can be imported) can affect the ...
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The Relationship Between Public and Private Debt

In this video, David Graeber says that if the public sector goes into a surplus, then the private sector must go into a deficit, in equivalent proportion. Is this true? Wouldn't this be complicated by ...
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Net capital outflow = Net exports (Net capital imports)?

They say Net Capital Outflow equals to Net Exports(S-I=NX). And they say also that Net Exports is nothing but the Net Capital Imports. Then how come "Net Capital Imports" is same with the "Net Capital ...
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Question about tariffs in Henry Hazlitt's Economics in One lesson

I've been reading Henry Hazlitt's Economics in One Lesson and he said something about free trade and tariffs that I don't quite understand. He uses the example of buying cheaper English sweaters ...
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Is an EU single currency still a trade advantage in 2019?

When the single currency was planned, there was no internet and there all currency exchange was manual. Today the web can automatically convert prices using multiplication of the numbers in the ...
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why doesn't every country scale up the prices to the international level?

I live in an Asian country in which the average monthly salary is maybe 300-400 dollars but things (apart from exported goods like laptops or smartphones) are reasonably cheap compared to their price ...
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If regional subsidiaries bypass trade restrictions, why are FTAs needed?

One of the ways corporations trade transnationally in the face of local restrictions on market access is to set up subsidiary companies or regional offices from which trade is conducted. If such ...
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What are some of the barriers to trading services?

As I understand it countries negotiate free trade agreements in services using the WTO GATS. But what are some of the barriers to the transnational exchange of services that an FTA would seek to ...
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What international payment systems do exist?

I recently read up on the Society for Worldwide Interbank Financial Telecommunication (SWIFT). As faar as I understood it was up until recently the only provider of a system to exchange money ...
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Two deflator series with different base year to proxy real exchange rate

I'm conducting a research in which the real exchange rate serves as a variable. A quick literature review shows that we can use the product of the nominal exchange rate and the ratio between the US ...
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Why does capital flight cause inflation?

Context: I was watching a video about Venezuela, and, it all started with capital flight due to poor confidence in the government. The government tried to stop it, and in the process it created a ...
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Are trade deficits good/bad or neither?

Is there an academic consensus on whether a trade deficit is good/bad or neither? And if that country is in a monetary union, does the answer change because the wealth moved out of the country can be ...
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Do sanctions work?

When countries commit "economic crimes"---ie, theft of intellectual property, dumping, currency manipulation---are sanctions effective at making them stop? I am specifically looking for examples of ...
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Are services included in the calculation of a trade deficit?

Are services included in the calculation of a trade deficit? Presumably measuring service exports is more difficult/less accurate(?) than for goods?
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What arguments are there in favor of national food self-sufficiency?

National food self-sufficiency is an idea that appeals to many non-economists. For example, George W. Bush (2001): It’s important for our Nation to be able to grow foodstuffs to feed our people. ...
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What does an increase in REER signify?

What does an increase in the real effective exchange rate signify? I read from a news report that (localized for India): Furthermore, REER is calculated in such a way that an increase in its ...
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Does the WTO have a mechanism to accommodate states transitioning trade regimes?

If the UK were to leave the EU without a Withdrawal Agreement in place it defaults to WTO trading terms. Does the WTO have a mechanism to accommodate such a transition?
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What's a good textbook on International Trade?

My professor for Int. Trade insists on using his unfinished notes as a basis for the class, so I'm looking for an alternative. The syllabus goes as follows: Gains from trade Free trade equilibrium ...
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What is the relation between the trade deficit and the outsourcing of jobs?

To make it easier, let's imagine USA exports nothing and imports nothing (or the exports have the same value with the imports = 0 trade deficit = the country exports the same amount of jobs as it is ...
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Is Universal Basic Income compatible with free international trade?

If one country introduces UBI, what prevents other countries from taking advantage of that and supplying cheaper (no need to finance a UBI scheme!) goods to the original country and outcompeting the ...
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How does a budget deficit help grow a trade deficit?

What are the mechanism that explains this, and does this help explain the U.S.-China trade deficits?
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HHI and concentration [closed]

I calculated the HHI index for Chile exports and got values ranging from 0.09 and 0.13. We know that Chilean exports are very concentrated (around 40% of the exports are copper related goods) and the ...
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Do free-trade agreements typically include clauses relating to services?

Do free-trade agreements typically include clauses relating to services? For example, reciprocal recognition of professional qualifications.
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Bond prices and Trade deficit

Why does the narrowing of trade deficit cause an increase in bond prices? I do understand that narrowing of trade deficit leads to narrowing of capital account surplus. Also, investor confidence ...
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IS-LM , Eurozone and Interest Rate Parity

In the IS-LM framework, when the CB expands Money supply, interest rates are driven down, investment is boosted, and aggregate output increases (shift of LM curve, movement along IS curve). In the ...
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World economy and world trade

What is the difference between the world economy and world trade? I have read in one book saying "US share in the world economy is 28% and in the world trade is 15%" (2008 edition though). Please ...
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Central bank selling foreign securities

According to the Krugman Obstfeld textbook, When a central bank sells foreign bonds, it decreases domestic money supply. My question is: foreign bonds are denoted in foreign currency. Selling these ...
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Paying for imports

In an open economy, a country can either pay for imports by running down its reserves, or by financial inflows. The payment for imports via reserves is easy to understand- an importer can go exchange ...
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Theory of Optimal Currency Areas

Should a country be more inclined or less inclined to join a currency union (common currency) under the following events: a) Increase in the size and frequency of AD shocks to the economy. b)...
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Are there internationally published sources of trade sanctions?

How to implement embargoes with respect to a trading company? Let's assume i am a small trading agent which assists and guides small exporters and importers while keeping embargoes and light ...
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Who performs the checks for regulatory compliance at trade borders? [closed]

Customs officers check for tax compliance at trade borders. But who performs the checks for regulatory compliance at trade borders? Is it simply the various Government ministries (eg the one ...
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Financing of Current Account Deficit

From the Balance of Payments identity, we have that: $$ CAB+FI=\triangle RES $$ Or that, the current account deficit is financed by either capital inflows, or a change in reserves. My question is ...
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J Curve and DD Schedule in the Short Run (International Finance)

Assume that the J-curve is true. What would the DD curve look like during the early period of the J-curve (where the value effect dominates)? What would the effect of temporary changes in monetary ...