Essays in international trade
- This dissertation studies the determinants of global trade patterns and strategic tariff negotiation in trade policy. The first essay examines why firms and countries indirectly export through trade intermediaries, with an emphasis on the role of financial frictions. I show theoretically and empirically that financially more constrained exporting firms and financially less developed countries are more likely to use trade intermediaries. The empirical analysis uses firm-level data on indirect exports for 118 countries and country-level data on entrepot trade through Hong Kong for over 50 countries. Calibrating a two-country version of the model in general equilibrium for China and US reveals important gains from trade intermediation. The second essay studies exporting countries' choice of trade partners, and shows that financial development is again an important determinant. The paper provides new, systematic evidence that at the aggregate level, countries follow a hierarchy, or pecking order, of export destinations. This pecking order is governed by the market potential of destinations such as market size and trade costs. Financially more developed countries have more trade partners and go further down the pecking order, especially in sectors that rely heavily on the financial system. The last essay studies tariff negotiation with a dynamic bargaining inefficiency known as forward manipulation. Forward manipulation is formalized in a non-cooperative game where countries negotiate over tariff levels in a sequential, bilateral fashion. The common party across the negotiation rounds has an incentive not to lower its tariff in the earlier stages of the game so that it can manipulate the threat points of negotiation partners in later stages. Forward manipulation is applied to explain gradualism, the observed pattern of tariffs declining slowly and gradually, for the early GATT rounds.
|Type of resource
|electronic; electronic resource; remote
|1 online resource.
|Chan, Man Lung
|Stanford University, Department of Economics.
|Statement of responsibility
|Jackie M. L. Chan.
|Submitted to the Department of Economics.
|Thesis (Ph.D.)--Stanford University, 2015.
- © 2015 by Man Lung Chan
- This work is licensed under a Creative Commons Attribution Non Commercial 3.0 Unported license (CC BY-NC).
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