scholarly journals Trade and Investment under Policy Uncertainty: Theory and Firm Evidence

2018 ◽  
pp. 89-122
Author(s):  
KYLE HANDLEY ◽  
NUNO LIMÃO
Keyword(s):  
Uncertainty Theory ◽  
Policy Uncertainty ◽  
Firm Evidence ◽  
Trade And Investment

scholarly journals Trade and Investment under Policy Uncertainty: Theory and Firm Evidence

2015 ◽  
Vol 7 (4) ◽  
pp. 189-222 ◽  
Author(s):  
Kyle Handley ◽  
Nuno Limão
Keyword(s):  
Large Fraction ◽  
Trade Agreements ◽  
Trade Policies ◽  
Policy Uncertainty ◽  
Trade Reform ◽  
Exporting Firms ◽  
If Current ◽  
Trade Policy Uncertainty ◽  
Firm Evidence ◽  
Trade And Investment

In a dynamic model with sunk export costs, a firm's export investment is lower under trade policy uncertainty, and credible preferential trade agreements (PTAs) increase trade even if current tariffs are low. Exploring Portugal's accession to the European Community as a policy uncertainty shock we find that the trade reform accounted for a large fraction of Portuguese exporting firms' entry and sales; the accession removed uncertainty about future EC trade policies; and this uncertainty channel accounted for a large fraction of the predicted growth. Our approach can be applied to other PTAs and sources of policy uncertainty. (JEL D22, F12, F14, F15, G31, L11)

A BVAR Approach to the Impact of Policy Uncertainty on International Trade and Investment

2018 ◽  
Vol 66 (3-4) ◽  
pp. 312-325
Author(s):  
Vijaykumar Dhannur ◽  
Ashwin R. John
Keyword(s):  
Interest Rates ◽  
Vector Autoregression ◽  
Impulse Response Function ◽  
Policy Uncertainty ◽  
Prior Beliefs ◽  
Macroeconomic Factors ◽  
The Interest Rate ◽  
The Impact ◽  
Trade And Investment ◽  
Indian Pharmaceutical Industry

This article investigates the impact of economic policy uncertainty (EPU) on foreign trade and investment into India relative to other macroeconomic factors with reference to the Indian pharmaceutical industry. It employs the Bayesian vector autoregression (BVAR) approach to construct a model and then study the said impact by the impulse response function (IRF) analysis. In a Bayesian procedure, the parameters are treated as random variables and their posterior distribution is estimated via the imposition of prior beliefs on their distribution, which makes the analysis more robust when combined with vector autoregression. The IRF analysis shows no substantial protracted impact of policy uncertainty, inflation and interest rates on the pharma exports. Also, inflation seems to have a more pronounced impact on FDI as compared to the interest rate changes contemporaneously.

scholarly journals Domestic Value Added in Exports: Theory and Firm Evidence from China

2016 ◽  
Vol 106 (6) ◽  
pp. 1402-1436 ◽  
Author(s):  
Hiau Looi Kee ◽  
Heiwai Tang
Keyword(s):  
Firm Heterogeneity ◽  
Value Added ◽  
Global Value Chains ◽  
Aggregation Bias ◽  
Value Chains ◽  
Investment Liberalization ◽  
Level Data ◽  
Transaction Level ◽  
Firm Evidence ◽  
Trade And Investment

China has defied the declining trend in domestic content in exports in many countries. This paper studies China's rising domestic content in exports using firm- and customs transaction-level data. The approach embraces firm heterogeneity and hence reduces aggregation bias. The study finds that the substitution of domestic for imported materials by individual processing exporters caused China's domestic content in exports to increase from 65 to 70 percent in the period 2000–2007. Such substitution was induced by the country's trade and investment liberalization, which deepened its engagement in global value chains and led to a greater variety of domestic materials becoming available at lower prices. (JEL F13, F14, L14, O19, O24, P31, P33)

Eurasian Economic Union: A sober look

2016 ◽  
pp. 43-60 ◽  
Author(s):  
E. Vinokurov
Keyword(s):  
The State ◽  
Customs Union ◽  
Macroeconomic Policies ◽  
Member States ◽  
Goods And Services ◽  
Eurasian Economic Union ◽  
Ongoing Work ◽  
General Rules ◽  
Economic Union ◽  
Trade And Investment

The paper appraises current progress in establishing the Customs Union and the Eurasian Economic Union (EAEU). Although the progress has slowed down after the initial rapid advancement, the Union is better viewed not as an exception from the general rules of regional economic integration but rather as one of the functioning customs unions with its successes and stumbling blocs. The paper reviews the state of Eurasian institutions, the establishment of the single market of goods and services, the situation with mutual trade and investment flows among the member states, the ongoing work on the liquidation/unification of non-tariff barriers, the problems of the efficient coordination of macroeconomic policies, progress towards establishing an EAEU network of free trade areas with partners around the world, the state of the common labor market, and the dynamics of public opinion on Eurasian integration in the five member states.

The relation between R&D accounting treatment and the risk of the firm: Evidence from the Italian market

2014 ◽  
pp. 33-54 ◽  
Author(s):  
Riccardo Cimini ◽  
Alessandro Gaetano ◽  
Alessandra Pagani
Keyword(s):  
Earnings Management ◽  
Fiscal Year ◽  
Investment Strategies ◽  
Capital Assets ◽  
Italian Market ◽  
D Investment ◽  
Firm Evidence

In this paper, we investigate the relation between the different accounting treatments of R&D expenditures and the risk of the entity in order to identify under which treatment insiders are more likely to carry out earnings management. By analysing the R&D investment strategies of a sample of 137 listed Italian entities that complied with the requirements of IAS 38 during fiscal year 2009, following Lantz and Sahut (2005), we calculate several indexes that show the preferences of insiders to account R&D expenditures as costs or capital assets, and we study the relation of such preferences with the risk of the entity, which we measure with the unlevered beta. We hypothesize that the entities, which considered the R&D investments as costs, are the riskiest ones due to the higher probability that insiders carried out earnings management. Our results confirm such hypothesis. This paper could have implications for academics and standard setters that could learn that behind accounting discretion, insiders could opportunistically behave against outsiders.

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