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This paper investigates the determinants of sustained accelerations in goods and services exports. Strong predictors of export takeoffs include domestic and structural indicators such as lower macroeconomic uncertainty, improved quality of institutions, a depreciated exchange rate, and agricultural reforms. Lower tariffs, participation in global value chains and diversification also contribute to initiating export accelerations. The paper also finds heterogeneity, with somewhat different triggers for Latin America and the Caribbean, as well as for goods and services. Finally, despite the lack of a robust effect on output, export surges tend to be associated with lower post-acceleration unemployment and income inequality.

Latin America --- Economic conditions. --- Exports and Imports --- Macroeconomics --- Trade Policy --- International Trade Organizations --- Empirical Studies of Trade --- Economic Growth of Open Economies --- Economic Development, Innovation, Technological Change, and Growth --- Economywide Country Studies: Latin America --- Caribbean --- Trade: General --- Aggregate Factor Income Distribution --- International economics --- Exports --- Service exports --- Export performance --- Income inequality --- Income distribution --- International trade --- National accounts --- Brazil

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We revisit the relationship between international trade, economic growth and inequality with a focus on Latin America and the Caribbean. The paper combines two approaches: First, we employ a cross-country panel framework to analyze the macroeconomic effects of international trade on economic growth and inequality considering the strength of trade connections as well as characteristics of countries’ export markets and products. Second, we consider event studies of past episodes of trade liberalization to extract general lessons on the impact of trade liberalization on economic growth and its structure and inequality. Both approaches consistently point to two broad messages: First, trade openness and connectivity to the center of the trade network has substantial macroeconomic benefits. Second, we do not find a statistically significant or economically sizable direct impact of trade on overall income inequality.

Globalization --- Latin America --- Economic conditions. --- E-books --- Exports and Imports --- Macroeconomics --- Economic Growth of Open Economies --- Globalization: General --- Trade: General --- Aggregate Factor Income Distribution --- Trade Policy --- International Trade Organizations --- Financial Aspects of Economic Integration --- International economics --- Exports --- Income inequality --- Trade liberalization --- Trade integration --- Trade policy --- International trade --- National accounts --- Economic integration --- Income distribution --- Commercial policy --- International economic integration --- Mexico

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This paper studies the potential for the export sector to play a more important role in promoting growth in Central America, Panama, and the Dominican Republic (CAPDR) through deeper intra-regional and global trade integration. CAPDR countries have enacted many free trade agreements and other regional integration initiatives in recent years, but this paper finds that their exports remain below the norm for countries of their size. Several indexes of outward orientation are constructed and suggest that the breadth of geographic trading relationships, depth of integration into global production chains, and degree of technological sophistication of exports in CAPDR are less conducive to higher exports and growth than in fast-growing, export-oriented economies. To boost exports and growth, CAPDR should implement policies to facilitate economic integration, particularly building a customs union, harmonizing trade rules, improving logistics and infrastructure, and enhancing regional cordination.

Commerce --- Business & Economics --- International Commerce --- International trade. --- Economic development --- Development, Economic --- Economic growth --- Growth, Economic --- External trade --- Foreign commerce --- Foreign trade --- Global commerce --- Global trade --- Trade, International --- World trade --- Economic policy --- Economics --- Statics and dynamics (Social sciences) --- Development economics --- Resource curse --- International economic relations --- Non-traded goods --- Exports --- Central America --- Economic integration. --- E-books --- International trade --- Exports and Imports --- Taxation --- Trade Policy --- International Trade Organizations --- Empirical Studies of Trade --- Economic Integration --- Economic Growth of Open Economies --- Macroeconomic Analyses of Economic Development --- Trade: General --- Financial Aspects of Economic Integration --- International economics --- Public finance & taxation --- Tariffs --- Customs unions --- Regional integration --- Service exports --- Taxes --- Economic integration --- Tariff --- Protectionism --- International economic integration --- United States

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We analyze the impact on productivity in advanced economies of fast-growing trade with China between the mid-1990s and late-2000s, separately identifying the export and import channels. We use country-sector-level data for 18 advanced economies and, similar to Autor, Dorn, and Hanson (2013), exploit exogenous variation in trade with China in a given country-sector by instrumenting imports from (exports to) China in a given country-sector with the average imports from (exports to) China in the same sector in other advanced economies. Our estimates point to large productivity gains from trading with China—the (exogenous) rise of China in global trade may have increased the level of total factor productivity by about 1.9 percent, or 12.3 percent of the overall increase over the sample period, in the median country-sector. By contrast, using a similar empirical strategy, we find adverse employment effects of Chinese imports in exposed country-industries, consistent with previous studies. Taken together, these findings point to large gains from free trade, while underscoring the scope for a more active policy role in redistributing them, particularly by easing workers’ transition between jobs and industries.

Economic development --- International trade --- China --- Commercial policy. --- E-books --- External trade --- Foreign commerce --- Foreign trade --- Global commerce --- Global trade --- Trade, International --- World trade --- Commerce --- International economic relations --- Non-traded goods --- Exports and Imports --- Labor --- Production and Operations Management --- Trade Policy --- International Trade Organizations --- Empirical Studies of Trade --- Economic Growth of Open Economies --- Institutions and Growth --- Trade: General --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Macroeconomics: Production --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- International economics --- Macroeconomics --- Labour --- income economics --- Imports --- Exports --- Total factor productivity --- Productivity --- Industrial productivity --- Economic theory --- China, People's Republic of --- Income economics

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Emerging economies are characterized by higher consumption and real wage variability relative to output and a strongly countercyclical current account. A real business cycle model of a small open economy that embeds a Mortensen-Pissarides type of search-matching frictions and countercyclical interest rate shocks can jointly account for these regularities. In the face of countercyclical interest rate shocks, search-matching frictions increase future employment uncertainty, improving workers’ incentive to save and generating a greater response of consumption and the current account. Higher consumption response in turn feeds into larger fluctuations in the workers’ bargaining power while the interest rates shocks lead to variations in the firms’ willingness to hire; both of which contribute to a highly variable real wage.

Business & Economics --- Economic Theory --- Business cycles. --- Business forecasting. --- Business --- Business forecasts --- Forecasting, Business --- Economic cycles --- Economic fluctuations --- Forecasting --- Economic forecasting --- Cycles --- Business cycles --- Labor market --- Econometric models --- E-books --- Employees --- Market, Labor --- Supply and demand for labor --- Markets --- Supply and demand --- Labor --- Macroeconomics --- Production and Operations Management --- Open Economy Macroeconomics --- Economic Growth of Open Economies --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- Financial Markets and the Macroeconomy --- Demand and Supply of Labor: General --- Wages, Compensation, and Labor Costs: General --- Unemployment: Models, Duration, Incidence, and Job Search --- Macroeconomics: Consumption --- Saving --- Wealth --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Labour --- income economics --- Labor markets --- Consumption --- Total factor productivity --- National accounts --- Economics --- Industrial productivity --- Mexico --- Income economics