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Western Hemisphere > Argentina

You are looking at 1 - 10 of 22 items for :

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  • Empirical Studies of Trade x
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Cover IMF Working Papers
Spillovers from Large Emerging Economies: How Dominant Is China?
Hany Abdel-Latif
and
Adina Popescu
This paper investigates the global economic spillovers emanating from G20 emerging markets (G20-EMs), with a particular emphasis on the comparative influence of China. Employing a Bayesian Global Vector Autoregression (GVAR) model, we assess the impacts of both demand-side and supply-side shocks across 63 countries, capturing the nuanced dynamics of global economic interactions. Our findings reveal that China's contribution to global economic spillovers significantly overshadows that of other G20-EMs. Specifically, China's domestic shocks have significantly larger and more pervasive spillover effects on global GDP, inflation and commodity prices compared to shocks from other G20-EMs. In contrast, spillovers from other G20-EMs are more regionally contained with modest global impacts. The study underscores China's outsized role in shaping global economic dynamics and the limited capacity of other G20-EMs to mitigate any potential negative implications from China's economic slowdown in the near term.
Keywords:
Emerging Economies; Growth Spillover; Global transmission; GVAR model; outsized role; China's contribution; IMF working paper No. 25/27; domestic shock; Spillovers; Supply shocks; Emerging and frontier financial markets; Oil prices; Global value chains; Global
Cover IMF Working Papers
Markups, Quality, and Trade Costs
Natalie Chen
and
Luciana Juvenal
We investigate theoretically and empirically how exporters adjust their markups across destinations depending on bilateral distance, tariffs, and the quality of their exports. Under the assumption that trade costs are both ad valorem and per unit, our model predicts that markups rise with distance and fall with tariffs, but these effects are heterogeneous and are smaller in magnitude for higher quality exports. We find strong support for the predictions of the model using a unique data set of Argentinean firm-level wine exports combined with experts wine ratings as a measure of quality.
Keywords:
WP; trade cost; FOB price; free on board; unit value; export price; wine export; Tariffs; Exports; Public expenditure review; Export prices; Demand elasticity; North America; Distance; export unit values; heterogeneity; markups; quality; trade costs; exports data
Cover IMF Working Papers
Commodity Terms of Trade: A New Database
Bertrand Gruss
and
Suhaib Kebhaj
This paper presents a comprehensive database of country-specific commodity price indices for 182 economies covering the period 1962-2018. For each country, the change in the international price of up to 45 individual commodities is weighted using commodity-level trade data. The database includes a commodity terms-of-trade index—which proxies the windfall gains and losses of income associated with changes in world prices—as well as additional country-specific series, including commodity export and import price indices. We provide indices that are constructed using, alternatively, fixed weights (based on average trade flows over several decades) and time-varying weights (which can account for time variation in the mix of commodities traded and the overall importance of commodities in economic activity). The paper also discusses the dynamics of commodity terms of trade across country groups and their influence on key macroeconomic aggregates.
Keywords:
WP; commodity terms of trade; terms-of-trade index; commodity price indices; trade flow; terms of trade; commodity prices; commodity export; commodity terms-of-trade indices; trade data; Commodity price indexes; Exports; Trade balance; Global
Cover IMF Working Papers
Global Trade and the Dollar
Ms. Emine Boz
,
Ms. Gita Gopinath
, and
Mikkel Plagborg-Møller
We document that the U.S. dollar exchange rate drives global trade prices and volumes. Using a newly constructed data set of bilateral price and volume indices for more than 2,500 country pairs, we establish the following facts: 1) The dollar exchange rate quantitatively dominates the bilateral exchange rate in price pass-through and trade elasticity regressions. U.S. monetary policy induced dollar fluctuations have high pass-through into bilateral import prices. 2) Bilateral non-commodities terms of trade are essentially uncorrelated with bilateral exchange rates. 3) The strength of the U.S. dollar is a key predictor of rest-of-world aggregate trade volume and consumer/producer price inflation. A 1 percent U.S. dollar appreciation against all other currencies in the world predicts a 0.6–0.8 percent decline within a year in the volume of total trade between countries in the rest of the world, controlling for the global business cycle. 4) Using a novel Bayesian semiparametric hierarchical panel data model, we estimate that the importing country’s share of imports invoiced in dollars explains 15 percent of the variance of dollar pass-through/elasticity across country pairs. Our findings strongly support the dominant currency paradigm as opposed to the traditional Mundell-Fleming pricing paradigms.
Keywords:
WP; software package; U.S. dollar; exchange rate; Bayesian semiparametrics; bilateral trade; dominant currency; exchange rate pass-through; hierarchical Bayes; panel data; trade elasticity; invoicing share; dollar pass-through; pass-through coefficient; log growth; price pass-through; Exchange rates; Currencies; Exchange rate adjustments; Import prices; Imports; Global
Cover IMF Working Papers
Quality, Trade, and Exchange Rate Pass-Through
Natalie Chen
and
Luciana Juvenal
This paper investigates theoretically and empirically the heterogeneous response of exporters to real exchange rate fluctuations due to product quality. Our model shows that the elasticity of demand perceived by exporters decreases with a real depreciation and with quality, leading to more pricing-to-market and to a smaller response of export volumes to a real depreciation for higher quality goods. We test the proposed theory using a highly disaggregated Argentinean firm-level wine export dataset between 2002 and 2009 combined with experts wine rankings as a measure of quality. The model predictions find strong support in the data and the results are robust to different measures of quality, samples, specifications, and to the potential endogeneity of quality.
Keywords:
WP; exchange rate; Exchage rate pass-through; pricing-to-market; quality; unit values; exports; firms; unit value; export volume; customs data; standard deviation; exports data; Real exchange rates; Exchange rate adjustments; Export prices; Exchange rates; Europe; Global
Cover IMF Working Papers
Four Decades of Terms-of-Trade Booms: Saving-Investment Patterns and a New Metric of Income Windfall
Gustavo Adler
and
Mr. Nicolas E Magud
We study the history of terms-of-trade booms (during 1970–2012), with a focus on Latin America, through the prisms of a simple metric that quantifies the associated income windfall. We also document saving patterns during these episodes and propose a measure of how much of the income windfall was saved. We find that Latin America‘s terms-of-trade shocks of the last decade have not differed much in magnitude from those observed during the 1970s, but that the associated windfall have been substantially larger. While aggregate saving increased more than in past episodes, the share of the windfall saved (the marginal saving rate) seems to be lower, suggesting that greater aggregate saving reflects mainly the sheer size of the windfall rather than a greater 'effort' to save it. Finally, we find evidence that, while savings during the boom help to increase post-boom income, the composition of such savings matters. Specifically, in past episodes, savings allocated to foreign asset accumulation appear to have contributed more to post-boom income than those devoted to domestic investment.
Keywords:
WP; current account; income windfall; Terms of trade; windfall; real income; aggregate saving; saving rate; terms-of-trade shock; terms-of-trade boom; boom episode; Personal income; Domestic savings; Foreign assets; Current account balance; Asia and Pacific; Europe
Cover IMF Working Papers
Financial Liberalization, Structural Change, and Real Exchange Rate Appreciations
Felipe Meza
and
Carlos Urrutia
We account for the appreciation of the real exchange rate in Mexico between 1988 and 2002 using a two sector dynamic general equilibrium model of a small open economy with two driving forces: (i) differential productivity growth across sectors and (ii) a decline in the cost of borrowing in foreign markets. These two mechanisms account for 60 percent of the decline in the relative price of tradable goods and explain a large fraction of the reallocation of labor across sectors. We do not find a significant role for migration remittances, foreign reserves accumulation, government spending, terms of trade, or import tariffs.
Keywords:
WP; interest rate
Cover IMF Working Papers
The Composition and Cyclical Behavior of Trade Flows in Emerging Economies
Mr. Reinout De Bock
Trade flows data show that the composition and cyclical properties of imports are similar in developed economies and emerging markets (EM) but this is not the case for exports. Unlike developed economies, (i) EM export few or only a selective set of capital goods and (ii) capital good and overall exports tend to be acyclical. The lack of procyclicality in exports drives the strong countercyclicality of EM trade balances observed in previous studies. A quantitative exercise demonstrates how the standard small open economy business cycle model can be improved for EM by incorporating these features.
Keywords:
WP
Cover IMF Working Papers
Financial Frictions and Business Cycles in Middle-Income Countries
Mr. Jaime Guajardo
A standard DSGE small open economy model can not generate the cyclical regularities of middle-income countries. It predicts excessive consumption smoothing, and procyclical, instead of countercyclical, real net exports. Previous studies have solved this problem by increasing the shocks’ persistence or by lowering the intertemporal elasticity of substitution. This paper tackles the problem by introducing market imperfections relevant for MICs into an otherwise standard model. More specifically, I build a model with limited access to the foreign capital market, identified as an external borrowing constraint, and asymmetric financing opportunities across nontradable and tradable sectors, identified as a sector-specific labor financing wedge. The key parameters associated to these frictions are deduced to replicate selected data for Chile between 1986 and 2004. I find that both frictions are necessary to replicate the cyclical regularities of middle-income countries as they help the model reproduce different features of the data: The external borrowing constraint makes investment and consumption of tradable goods more procyclical and volatile, and makes real net exports countercyclical, while the sector-specific labor financing wedge makes the model reproduce the cyclical moments of work hours and consumption of non tradable goods.
Keywords:
WP
Cover IMF Staff Country Reports
Bosnia and Herzegovina: Selected Issues
International Monetary Fund
The current account deficit by the Central Bank of Bosnia and Herzegovina in recent years has fluctuated to about 20 percent of GDP. But official current account statistics suffer from several shortcomings. Possible sources of the savings required to achieve a fiscal position consistent with long-term fiscal sustainability is discussed. A theoretical model of the trade balance has been developed and used as the basis for estimating a quarterly regression model of Bosnia and Herzegovina’s trade balance. Effective fiscal coordination is essential in Bosnia and Herzegovina.
Keywords:
national government; exchange rate; debt dynamics; expenditures saving; government function; Trade balance; Credit; Bank credit; Africa; Europe; long-term debt dynamics; Policy implication; International Monetary Fund Washington; D.C.; publication policy; Outward remittances; Current account deficits; Current account; Eastern Europe; Global