Journal: The World Economy

Abbreviation

World econ. (Print)

Publisher

Wiley

Journal Volumes

ISSN

0378-5920
1467-9701

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2019 - 201912020 - 20227
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Publications1 - 8 of 8
  • Drivers of financial globalisation: The role of informational frictions
    Item type: Review Article
    Haelg, Florian (2022)
    The World Economy
    Social globalisation reduces informational frictions and is expected to promote international financial integration. This is because, the cost to obtain information constitutes a significant barrier to cross-border financial flows. I examine how aspects of social globalisation influence financial integration by the revised KOF Globalisation Index. The index allows to disentangle trade and financial globalisation, different aspects of social globalisation, and de facto and de jure aspects of globalisation. The results suggest that de facto financial globalisation is associated with aspects of social globalisation that represent channels of information transmission. In particular, financial globalisation is positively associated with personal contacts but not associated with information flows and cultural proximity. I propose that personal contacts are important to overcome cross-border informational frictions and promote international financial integration.
  • How COVID-19 travels in- and outside of value chains and then affects the stock market: Evidence from China
    Item type: Journal Article
    Egger, Peter H.; Zhu, Jiaqing (2022)
    The World Economy
    The organisation of value chains within and between firms and even countries is an important reason for domestic as well as international travel. Hence, value chains create interdependencies which have to do with economic but also personal interactions between firms and places. The latter means value chains are a springboard for shocks—positive or negative—to travel and other related outcomes. This paper sheds light on how input–output relations in China as one human-interaction-intensive activity can help explain spreading patterns of COVID-19 in the first few months of 2020 in China. We document that COVID-19 at that time spread more intensively where input–output relations were stronger between cities in China, and this contributed to inducing direct and mediated, indirect effects on the stock market.
  • Kick‐starting diffusion: Explaining the varying frequency of preferential trade agreements’ environmental provisions by their initial conditions
    Item type: Journal Article
    Morin, Jean-Frédéric; Blümer, Dominique; Brandi, Clara; et al. (2019)
    The World Economy
  • The effects of services trade policies. Introduction to the special issue
    Item type: Other Journal Item
    Egger, Peter H.; Schwarzer, Johannes (2020)
    The World Economy
    This is the introduction to the special issue on services trade policy.
  • Trade and foreign direct investment-related impacts of Brexit
    Item type: Journal Article
    Latorre, María C.; Olekseyuk, Zoryana; Yonezawa, Hidemichi (2020)
    The World Economy
    We offer a general‐equilibrium analysis of Brexit incorporating the state‐of‐the‐art differences in productivity and firms' selection within manufacturing sectors à la Melitz (Econometrica, 2003, 71, 1695) and multinationals in services. Our results suggest that trade, output and average productivity diminish across most sectors in the UK and the Rest of the European Union (REU), as well as GDP, welfare, wages and capital remuneration. However, the UK loses more due to the missing preferential access to the huge EU market. Significant welfare losses along the extensive margin occur in the UK due to the lost imported varieties produced by highly productive European firms. These cannot be compensated by the new varieties of less productive domestic firms that enter the British market due to increased protectionism and reduced import competition. In addition, the emergence of barriers against multinationals, which is often ignored in previous studies, explains approximately one third of the negative effect in both the UK and REU. Furthermore, we show that the Brexit impact is about only half if we do not include both foreign direct investment barriers and Melitz structure. Thus, previous studies without these important model features would underestimate the Brexit impact significantly.
  • The 'Forgotten' middle class: An analysis of the effects of globalisation
    Item type: Journal Article
    Pleninger, Regina; de Haan, Jakob; Sturm, Jan-Egbert (2022)
    The World Economy
    This paper studies the effects of globalisation on the income share of the middle class. Our findings suggest that globalisation, proxied by the KOF Economic Globalization Index, reduces the income share of the middle class. The income share of the poorest 20% also drops due to globalisation, while that of the richest 20% increases. We find that only de facto and not de jure measures of globalisation have statistically significant effects on income shares and inequality. Our results are robust for alternative definitions of the middle-class income share and hold for trade and financial globalisation. When we distinguish between groups of countries, we find that our main result is driven by low- and middle-income countries; for high-income countries, we do not find evidence that globalisation has an effect on the income share of the middle class.
  • On the sensitivity of trade costs to services trade restrictions
    Item type: Journal Article
    Blank, Sven; Egger, Peter H. (2022)
    The World Economy
    Services constitute a significant part of GDP and overall trade in modern economies, but little is known about the magnitude of its obstacles. Great effort has been made to establish measures of services trade frictions on the part of the Organization of Economic Cooperation and Development (OECD) and the World Bank. A customary way of using these measures is to employ them in log-linear regressions to gauge their effect on services trade flows. This may be problematic to the extent that these measures do not capture ad valorem (tariff type price increasing) trade costs. Hence, it is natural to believe that available services trade cost measures may have a nonlinear impact on services trade flows. The present paper documents that this is the case, using nonparametric estimates to quantify the direct impact of important trade cost measures captured by the Services Trade Restrictiveness Index of the OECD on cross-border services transaction costs and trade.
  • The United Kingdom and the stability of the Euro area: From Maastricht to Brexit
    Item type: Journal Article
    Campos, Nauro F.; Macchiarelli, Corrado (2020)
    The World Economy
    The two key events expected to mark the year 2019 were the 20th anniversary of the euro and Brexit. This paper examines the role of the United Kingdom on the stability of the euro area. We study stability from the perspective of synchronisation of economic activity in a core and periphery framework. We show the UK, since 1990, has become significantly more integrated with the EU economy. The UK moved from the periphery before 1990 to the core afterwards. We also find that the level of synchronisation of the UK economy has had the highest variability over time among all countries.
Publications1 - 8 of 8