Suchergebnisse

AbstractAnderson and van Wincoop (American Economic Review (2003), 69:106) make a convincing argument that traditional gravity equation estimates are biased by the omission of multilateral resistance terms. They show that these multilateral resistance terms are implicitly defined by a system of non‐linear equations involving all regions' GDP shares and a global interdependence structure involving trade costs. We show how linearizing the system of non‐linear relationships around a free trade world leads to an interdependence structure that can be used as a Bayesian prior to produce statistical estimates of the inward and outward multilateral resistance indices. This reflects a statistical approach that has advantages over the non‐stochastic numerical approach used by Anderson and van Wincoop (2003) to solve for these indices.

AbstractThe pandemic crisis will likely shift global trade into digital services. This turn is consistent with the broader picture in which the nature of globalization becomes increasingly based on the Internet, ideas, information, and data. That provides new trade opportunities for poorer countries to participate in digital services. To harness the benefits of this trend, policymakers around the globe should take action to stop the reversal of open digital trade policies, find common grounds to foster regulatory cooperation on cross‐border data flows, and enhance the understanding of the economic impact of new trade restrictions in digital services.