Suchergebnisse

There is a well-established literature on border effects covering trade between regions separated by a land border; however that literature has not so far considered the case of regions separated by a sea border. Whilst the former is typically studied as a political border that affects adjacent regions belonging to different countries and can be reduced by free trade agreements, the latter is a geographical border that affects regions within the same country and cannot be reduced in a similar way. Both types of borders produce similar effects upon trade, calling for a modification of the trade cost function to reflect the fixed cost caused by the need to pay fees and taxes, as well as the time-loss inefficiency, related to the existence of the border. However, in the case of the sea border that fixed cost is due to the use of two modes of transport (road and sea typically). The empirical strategy used to estimate the island effect proceeds in two steps. First an augmented gravity model is estimated for mainland and island regions; then a Blinder-Oaxaca decomposition is applied to the gravity estimation results in order to disentangle the distance and border effects for those regions, net of all other factors controlled for in the gravity estimations. Results show that island regions are at a substantial disadvantage compared to continental regions, which is due more to the lack of adjacency imposed by the sea border rather than to the higher average distance.

"This paper reexamines the evidence on the border effect, the finding that the border drives a wedge between domestic and foreign prices. We argue that the border effect can be inflated by the volatility and persistence of the nominal exchange rate and by the cross-country heterogeneity in the distribution of within-country price differentials. We develop a simple framework to separate the border effect from these confounding factors. Using price data from Engel and Rogers (1996) and Parsley and Wei (2001), we show that after controlling for the confounding factors the border effect between the U.S. and Canada and the U.S. and Japan is negligible"--National Bureau of Economic Research web site

To address the economic significance of national border effects, this paper provides evidence on two fundamental questions: (1) Do large border effects arise because of high perceived-price wedges between foreign and domestic products, or because imports and domestic goods are very close substitutes?; and (2) If price wedges are important, do they reflect distortionary barriers to trade or do they arise from nondistortionary factors, such as differences in transactions costs or product characteristics? I conclude that, while border effects may imply barriers, welfare costs, and a role for policy, distortions are probably not as substantial as initial border results suggested.

This paper explores whether the cross-border effect of ethnic violence is contingent on internal factors, such as domestic security measures, distribution of religious sites, availability of communication tools, and proximity to turbulent neighboring countries. Using county-level data from Xinjiang (1995–2012), our analyses show no support for direct violence-enhancing effects of outside terrorism in Xinjiang. When terrorist attacks increase globally or in neighboring countries, overall violence in Xinjiang diminishes. We attribute this to increased security measures by the government. However, the reduction in violence is highly conditional on local factors. We find that historical religiosity and geographic proximity to the border reduce the subsident effects of external terrorism.

This paper explores whether the cross-border effect of ethnic violence is contingent on internal factors, such as domestic security measures, distribution of religious sites, availability of communication tools, and proximity to turbulent neighboring countries. Using county-level data from Xinjiang (1995–2012), our analyses show no support for direct violence-enhancing effects of outside terrorism in Xinjiang. When terrorist attacks increase globally or in neighboring countries, overall violence in Xinjiang diminishes. We attribute this to increased security measures by the government. However, the reduction in violence is highly conditional on local factors. We find that historical religiosity and geographic proximity to the border reduce the subsident effects of external terrorism.

The existence of a large border effect is considered as one of the main puzzles of international macroeconomics. We show that the border effect is, to a large extent, an artefact of geographical concentration. To do so, we combine international flows with intra-national flows data characterised by a high geographical grid. At this fine grid, intra-national flows are highly localised and dropping sharply with distance. The use of a small geographical unit of reference to measure intra-national bilateral trade flows allows to estimating correctly the negative impact of distance on shipments. When we use sector disaggregated export flows of 50 Spanish provinces in years 2000 and 2005 split into inter-provincial and inter-national flows, we find that the border effect is reduced substantially and even becomes statistically not different from zero in some estimations. ; Financial support from Spanish Ministry of Science and Innovation (ECO2010-21643/ECON; project ECO 2008-04059/ECON), Regional Government of Madrid (project TransporTrade S2007/HUM/497), Department of Education, Universities and Research of the Basque Government, and Generalitat Valenciana (project Prometeo/2009/098).

Distance related variables typically vary in a cross-section dimension but less so in a time dimension across cities, regions, or countries. The enlargement of the EU or the introduction of the euro, however, can be looked upon as integration shocks that are informative of the consequences of changes in distance over time. Border cities or regions are thought to be more affected by these shocks than more central locations because of the larger impact of changes in the transaction costs that go along with EU integration along the border. Both at the urban and regional level, we find a beneficial influence of the EU integration process as measured by the growth in population share along the integration borders, leading to an extra growth rate of about 0.15 percentage points per annum. The positive integration holds on both sides of the integration border, is active for a limited distance (up to 70km) and time period (up to 30 years), and is particularly important for large cities and regions. Despite the positive EU integration effect, being located along a border remains a burden in view of the (larger) negative general border effect. We do not find similar positive border-integration effects as a result of the introduction of the euro.

To what extent do national borders and national currencies impose costs that segment markets across countries? To answer this question the authors use a dataset with product-level retail prices and wholesale costs for a large grocery chain with stores in the United States and Canada. They develop a model of pricing by location and employ a regression discontinuity approach to estimate and interpret the border effect. They report three main facts: One, the median absolute retail price and wholesale cost discontinuities between adjacent stores on either side of the U.S.-Canadian border are as high as 21 percent. In contrast, within-country border discontinuity is close to 0 percent. Two, the variation in the retail price gap at the border is almost entirely driven by variation in wholesale costs, not by variation in markups. Three, the border gaps in prices and costs co-move almost one-to-one with changes in the U.S.-Canadian nominal exchange rate. They show these facts suggest that the price gaps they estimate provide only a lower bound on border costs.

This article examines how the institutional design of borders affects international trade. The authors explore variation in the effects of borders by comparing new international borders that follow precedent and thus have a prior institutional history with new international borders that lack such an institutional history. The former minimally disrupt—or restore—previous economic networks, while the latter fundamentally disrupt existing economic networks. A variety of empirical tests show that, consistent with this institutional perspective on borders, new international boundaries that follow precedent are associated with significantly faster recovery and greater increase in subsequent trade flows. By contrast, when new international borders are truly new, they disrupt local economic networks, introduce new transaction costs, and impose higher adjustment costs on states, which the authors show to have long-term deleterious effects on trade.