Trade Imbalances and Multilateral Trade Cooperation

Asymmetric Trade Costs, Trade Imbalances, and the World Income Distribution

Earlier work by Waugh (2010) suggests that asymmetric market access costs across exporting countries are a major reason for differences in real per-capita income around the globe: 25% − 50% (depending on the measure) of world income inequality could be explained by cross-country trade cost asymmetries alone. We show that these results were driven by what we call model under-specification, an il...

Regional Trade Agreements in a Multilateral Trade Regime: An Overview

One of the most striking development in the world trading system since the mid 1990s is a surge in Regional Trade Agreements (RTAs). From about 50 till 1990, the number of RTAs notified to the World Trade Organization (WTO) has crossed 250 in 2003 and estimates indicate that over 300 RTAs will be in effect by 2007. Initially WTO encouraged the growth of RTAs because it believed that regional in...

Dynamic Patterns of Trade Imbalances

Based on the recursive preference approach, the dynamic and global properties of the two-country open economy are examined with one good and inputs of labor and capital, with capital being freely traded internationally. First by showing that the world’s consumption increases (resp. decreases) with an increase (resp. decrease) in the world’s capital, the global stability of the economy is obtain...

Multilateral Trade Liberalization and Poverty Reduction

Oil price shocks and trade imbalances

a r t i c l e i n f o JEL classification: F1 F4 Q43 N75 Keywords: Oil price shock Trade balance VAR Granger non-causality test Gregory-Hansen cointegration test This study aims to examine whether a large part of the variability of trade balances and their oil and non-oil components is associated with oil price fluctuations. The long-run causality running from oil price to overall, oil and non-o...