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Europe > Norway

You are looking at 1 - 2 of 2 items for :

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  • Globalization x
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Cover IMF Working Papers
Dollar Invoicing, Global Value Chains, and the Business Cycle Dynamics of International Trade
Mr. David Cook
and
Nikhil Patel
Recent literature has highlighted that international trade is mostly priced in a few key vehicle currencies and is increasingly dominated by intermediate goods and global value chains (GVCs). Taking these features into account, this paper reexamines the relationship between monetary policy, exchange rates and international trade flows. Using a dynamic stochastic general equilibrium (DSGE) framework, it finds key differences between the response of final goods and GVC trade to both domestic and foreign shocks depending on the origin and ultimate destination of value added and the intermediate shipments involved. For example, the model shows that in response to a dollar appreciation triggered by a US interest rate increase, direct bilateral trade between non-US countries contracts more than global value chain oriented trade which feeds US final demand, and exports to the US decline much more when measured in gross as opposed to value added terms. We use granular data on GVCs at the sector level to document empirical evidence in favor of these key predictions of the model.
Keywords:
Dollar invoicing; global value chains; exchange rates; monetary policy; business cycle dynamics; dollar invoicing; EU importer; EU exporter; goods trade; Exports; Global value chains; Currencies; Trade balance; Imports; Global; interest rate shock; aggregate exchange rate passthrough; gross export; export platform; East Asia
Cover IMF Working Papers
The Distribution of Gains from Globalization
Valentin F. Lang
and
Ms. Marina Mendes Tavares
We study economic globalization as a multidimensional process and investigate its effect on incomes. In a panel of 147 countries during 1970-2014, we apply a new instrumental variable, exploiting globalization’s geographically diffusive character, and find differential gains from globalization both across and within countries: Income gains are substantial for countries at early and medium stages of the globalization process, but the marginal returns diminish as globalization rises, eventually becoming insignificant. Within countries, these gains are concentrated at the top of national income distributions, resulting in rising inequality. We find that domestic policies can mitigate the adverse distributional effects of globalization.
Keywords:
WP; economic globalization; globalization score; national income; Globalization; Growth; Inequality; globalization process; globalization index; income level; globalization's effect; income growth; globalization indicator; effect of globalization; globalization scores; Personal income; Income inequality; Income distribution; Global