Andras Komaromi's Books

Revisiting the Link between Trade, Growth and Inequality

Lessons for Latin America and the Caribbean

By: Ms.Kimberly Beaton,Aliona Cebotari,Andras Komaromi

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Revisiting the Link between Trade, Growth and Inequality

Lessons for Latin America and the Caribbean

By: Ms.Kimberly Beaton,Aliona Cebotari,Andras Komaromi

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.

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International Monetary Fund

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ISBN 10

1475585551

ISBN 13

9781475585551

Financial Openness and Capital Inflows to Emerging Markets: In Search of Robust Evidence

By: Diego A. Cerdeiro,Andras Komaromi

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Financial Openness and Capital Inflows to Emerging Markets: In Search of Robust Evidence

By: Diego A. Cerdeiro,Andras Komaromi

We reassess the connection between capital account openness and capital flows in an empirical framework that is grounded in theory and makes use of previously unexplored variation in the data. We demonstrate how our theory-consistent regressions may overcome some ubiquitous measurement problems in the literature by relying on interaction terms between financial openness and traditional push-pull factors. Within our proposed framework, we ask: what can be said robustly about the effect of capital account restrictions on capital flows? Our results warrant against over-interpreting the existing cross-country evidence as we find very few robust relationships between capital account restrictiveness and various types of capital inflows. Countries with a higher degree of financial openness are more susceptible to some, but by no means all, push and pull factors. Overall, the results are still consistent with a complex set of tradeoffs faced by policymakers, where the ability to shield the domestic economy from volatile capital flow cycles must be weighed against the sources of exogenous risks and potential long run growth effects.

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International Monetary Fund

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ISBN 10

1513515098

ISBN 13

9781513515090

Trade and Income in the Long Run: Are There Really Gains, and Are They Widely Shared?

By: Diego A. Cerdeiro,Andras Komaromi

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Trade and Income in the Long Run: Are There Really Gains, and Are They Widely Shared?

By: Diego A. Cerdeiro,Andras Komaromi

In the cross section of countries, there is a strong positive correlation between trade and income, and a negative relationship between trade and inequality. Does this reflect a causal relationship? We adopt the Frankel and Romer (1999) identification strategy, and exploit countries' exogenous geographic characteristics to estimate the causal effect of trade on income and inequality. Our cross-country estimates for trade's impact on real income are consistently positive and significant over time. At the same time, we do not find any statistical evidence that more trade increases aggregate measures of income inequality. Heeding previous concerns in the literature (e.g. Rodriguez and Rodrik, 2001; Rodrik, Subramanian and Trebbi, 2004), we carefully analyze the validity of our geography-based instrument, and confirm that the IV estimates for the impact of trade are not driven by other direct or indirect effects of geography through non-trade channels.

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International Monetary Fund

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ISBN 10

1484324854

ISBN 13

9781484324851

World Seaborne Trade in Real Time: A Proof of Concept for Building AIS-based Nowcasts from Scratch

By: Mr. Diego A. Cerdeiro,Andras Komaromi,Yang Liu,Mamoon Saeed

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World Seaborne Trade in Real Time: A Proof of Concept for Building AIS-based Nowcasts from Scratch

By: Mr. Diego A. Cerdeiro,Andras Komaromi,Yang Liu,Mamoon Saeed

Maritime data from the Automatic Identification System (AIS) have emerged as a potential source for real time information on trade activity. However, no globally applicable end-to-end solution has been published to transform raw AIS messages into economically meaningful, policy-relevant indicators of international trade. Our paper proposes and tests a set of algorithms to fill this gap. We build indicators of world seaborne trade using raw data from the radio signals that the global vessel fleet emits for navigational safety purposes. We leverage different machine-learning techniques to identify port boundaries, construct port-to-port voyages, and estimate trade volumes at the world, bilateral and within-country levels. Our methodology achieves a good fit with official trade statistics for many countries and for the world in aggregate. We also show the usefulness of our approach for sectoral analyses of crude oil trade, and for event studies such as Hurricane Maria and the effect of measures taken to contain the spread of the novel coronavirus. Going forward, ongoing refinements of our algorithms, additional data on vessel characteristics, and country-specific knowledge should help improve the performance of our general approach for several country cases.

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International Monetary Fund

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ISBN 10

1513544101

ISBN 13

9781513544106

Trade Integration in Latin America: A Network Perspective

By: Ms.Kimberly Beaton,Aliona Cebotari,Xiaodan Ding,Andras Komaromi

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Trade Integration in Latin America: A Network Perspective

By: Ms.Kimberly Beaton,Aliona Cebotari,Xiaodan Ding,Andras Komaromi

The paper applies a network analysis framework to analyze the regional and global integration of Latin American and Caribbean (LAC) countries. We compare network-based measures of trade integration to conventional measures, decomposing integration along several dimensions to better understand the sources of trade connectivity and their impact on growth. The paper finds that LAC countries are relatively well integrated in terms of links to diversified markets, but the strength of those links is weak. Comparing trade integration to predictions from gravity models, we find many LAC countries have significant scope to improve connectivity and increase their roles in regional and world trade networks.

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International Monetary Fund

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ISBN 10

1484303660

ISBN 13

9781484303665

Assessing Liquidity Buffers in the Panamanian Banking Sector

By: Andras Komaromi,Metodij Hadzi-Vaskov,Torsten Wezel

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Assessing Liquidity Buffers in the Panamanian Banking Sector

By: Andras Komaromi,Metodij Hadzi-Vaskov,Torsten Wezel

This paper assesses the resilience of Panamanian banks to (i) a very severe short-term, and (ii) a significant long-lasting liquidity shock scenario. Short-term liquidity buffers are evaluated by approximating the Liquidity Coverage Ratio (LCR) defined in the Basel III accord. The risk of losing a substantial part of foreign funding is analyzed through a conventional liquidity stress test scrutinizing several layers of liquidity across maturity buckets. The results of this study point to some vulnerabilities. First, our approximations indicate that about half of Panamanian banks would need to adjust their liquid asset portfolios to meet current LCR standards. Second, while most banks would be able to meet funding outflows in the stress-test scenario, a number of banks would have to use up all of their liquidity buffers, and a few even face a final shortfall. Nonetheless, most banks displaying sizable liquidity shortfalls have robust solvency positions.

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International Monetary Fund

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ISBN 10

1475544839

ISBN 13

9781475544831

Supply Chains and Port Congestion Around the World

By: Andras Komaromi,Mr. Diego A. Cerdeiro,Yang Liu

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Supply Chains and Port Congestion Around the World

By: Andras Komaromi,Mr. Diego A. Cerdeiro,Yang Liu

Rising prices and reports of empty shelves in major economies have drawn attention to the functioning of supply chains that normally operate smoothly in the background. Among the issues, the long delays that port congestion may have caused in delivering goods to consumers and firms have been gathering increasing attention. We shed light on these issues leveraging a unique data set on maritime transport. Two main features emerge. First, at the world level, we find that shipping times jumped upwards as soon as the COVID crisis hit, and after a marked acceleration from end-2020, delays surpassed 1.5 days on average by December 2021 – or roughly a 25 percent increase in global travel times. The estimated additional days in transit for the average shipment in December 2021 can be compared to an ad-valorem tariff of 0.9 to 3.1 percent. The midpoint of this range is approximately equal, in absolute value, to the global applied tariff reduction achieved over the 14-year period from 2003 to 2017. Second, not all congestion appears related to increased demand. Many ports, especially since mid-2021, exhibit longer wait times despite handling less cargo than pre-pandemic. Infrastructure upgrading is therefore likely a necessary, but not sufficient condition for building resilience during a crisis where other factors (such as labor shortages) may also become binding.

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