We revisit the question of the quantitative benefits of WTO trade agreements in a setup that is non-standard from the traditional trade policy point of view. We show that in a New Keynesian model, unilateral trade liberalization reduces welfare due to terms-of-trade deterioration, creating an incentive for a trade agreement. For realistic parameter values, the value of an agreement, which cuts tariffs by one percentage point, is 0.5% to 2% of consumption, much larger than in trade models. The intuition for this result hinges on some New Keynesian features of our framework, such as imperfect competition and endogenous labor supply.
We analyze the welfare multipliers of public spending (the consumption equivalent change in welfare for one dollar change in public spending) in a DSGE model. The welfare multipliers of public infrastructure investment are positive if infrastructure is sufficiently effective. When the medium-term output multipliers are consistent with the empirical estimates (1-1.4), the welfare multiplier is 0.8. That is, a dollar spent by the government for investment raises domestic welfare by equivalent of 0.8 dollars of private consumption. This suggests that the welfare gains of public infrastructure investment, if chosen wisely, may be substantial.
Using a DSGE model calibrated to the euro area, we analyze the international effects of a fiscal devaluation (FD) implemented as a revenue-neutral shift from employer's social contributions to the Value Added Tax. We find that a FD in ‘Southern European countries’ has a strong positive effect on output, but mild effects on the trade balance and the real exchange rate. Since the benefits of a FD are small relative to the divergence in competitiveness, it is best addressed through structural reforms.
This paper studies tariff-tax reforms in a calibrated two-region global New Keynesian model composed of a developing and an advanced region. In our baseline calibration, a revenue-neutral reform that lowers tariffs in developing countries can reduce domestic welfare. The reason is that the increase in developing countries welfare due to higher output is dominated by the welfare losses stemming from the deterioration of the terms of trade. On the other hand, the reform increases output and welfare in the advanced countries and in the world as a whole. The effects that we highlight have not been studied in previous contributions to the literature, which typically looks at tariff-tax reforms using a small open economy framework. Nominal rigidities have important implications for adjustment dynamics in our model. In the case of a "point-for-point" reform, for example, price stickiness implies that the international dynamics of output is reversed compared to a revenue neutral reform.
We analyze the welfare multipliers of public spending (the consumption equivalent change in welfare for one dollar change in public spending) in a DSGE model. The welfare multipliers of public infrastructure investment are positive if infrastructure is sufficiently effective. When the medium-term output multipliers are consistent with the empirical estimates (1-1.4), the welfare multiplier is 0.8. That is, a dollar spent by the government for investment raises domestic welfare by equivalent of 0.8 dollars of private consumption. This suggests that the welfare gains of public infrastructure investment, if chosen wisely, may be substantial. --Abstract.
Using a DSGE model calibrated to the euro area, we analyze the international effects of a fiscal devaluation (FD) implemented as a revenue-neutral shift from employer's social contributions to the Value Added Tax. We find that a FD in ‘Southern European countries’ has a strong positive effect on output, but mild effects on the trade balance and the real exchange rate. Since the benefits of a FD are small relative to the divergence in competitiveness, it is best addressed through structural reforms.
We analyze the welfare multipliers of public spending (the consumption equivalent change in welfare for one dollar change in public spending) in a DSGE model. The welfare multipliers of public infrastructure investment are positive if infrastructure is sufficiently effective. When the medium-term output multipliers are consistent with the empirical estimates (1-1.4), the welfare multiplier is 0.8. That is, a dollar spent by the government for investment raises domestic welfare by equivalent of 0.8 dollars of private consumption. This suggests that the welfare gains of public infrastructure investment, if chosen wisely, may be substantial.
This paper studies tariff-tax reforms in a calibrated two-region global New Keynesian model composed of a developing and an advanced region. In our baseline calibration, a revenue-neutral reform that lowers tariffs in developing countries can reduce domestic welfare. The reason is that the increase in developing countries welfare due to higher output is dominated by the welfare losses stemming from the deterioration of the terms of trade. On the other hand, the reform increases output and welfare in the advanced countries and in the world as a whole. The effects that we highlight have not been studied in previous contributions to the literature, which typically looks at tariff-tax reforms using a small open economy framework. Nominal rigidities have important implications for adjustment dynamics in our model. In the case of a "point-for-point" reform, for example, price stickiness implies that the international dynamics of output is reversed compared to a revenue neutral reform.
We revisit the question of the quantitative benefits of WTO trade agreements in a setup that is non-standard from the traditional trade policy point of view. We show that in a New Keynesian model, unilateral trade liberalization reduces welfare due to terms-of-trade deterioration, creating an incentive for a trade agreement. For realistic parameter values, the value of an agreement, which cuts tariffs by one percentage point, is 0.5% to 2% of consumption, much larger than in trade models. The intuition for this result hinges on some New Keynesian features of our framework, such as imperfect competition and endogenous labor supply.
Kun sä pyörit konferensseissa ympäri maailmaa, mä hoidin yksin sekä Aapon kasvatuksen että oman urani." Viisikymmenvuotisuutta lähenevän sosiaalipsykologian oppituolin haltijan Johannan elämä ja ura ovat käännekohdassa. Managerivalta kuristaa yliopistoa, nuoren tutkijan kärkäs ote julkisuuteen johtaa ristiriitoihin, poika itsenäistyy omaan suuntaansa, ex-puoliso on pihalla ja uusi rakastettu kaukana, dekaani hännystelee ennemminkin bisnesmoskaa suoltavaa kehittäjärehtoria kuin tietoon ja totuuteen kiinnittyvää professoria. Johanna ryhtyy tutkimaan yliopiston autonomian loukkaamista ja sen seurauksia. Miten käy tieteenharjoituksen ja siihen nojaavan järkiperäisen päätöksenteon? DOSENTIT on ajankohtaiseen kamppailuun iskeytyvä painokas yhteiskunnallinen draama. Sen kantaesitys nähtiin syyskuussa 2021 Suomen Kansallisteatterissa. Näytelmäkirja on Kansalliskirjaston ja ntamon yhteistyötä. Teokseen sisältyvät Jokelan jälkisanat. "Mitä sä luulet, et tapahtuu, ku tulee vielä tiedevastasempi hallitus?
Trumpetisti Milton "Milt" King jännittää tärkeää koesoittoa: onnistuuko hän ylittämään isänsä musiikkiurallaan? Isä ei ehtinyt isoille lavoille soittamaan, mutta jätti soittimen pojalleen perinnöksi. Muusikon leipä ei ole leveä, minkä nuori trumpetisti saa karvaasti kokea. Onneksi aiempien aikojen suuret mestarit viitoittavat Miltin matkaa jazzin maailmassa. Todellisuuden rajat liukuvat ja jazzin poljento hakkaa! Pienoisromaanisarjan kolmannessa osassa jazzin kehdosta New Orleansista kotoisin oleva Milt esiintyy klubeilla ja raivaa tietään suosioon. Nuori tuorilalainen mies ihastuu musiikkiklubilla mystiseen Audreyhin ja etsii naista maailman toiselta laidalta. Juha Mäntylän romaanisarja on yhtä täynnä rytmiä kuin keikkapaikan täyteen vetänyt jazz-konsertti. Juha Mäntylä on kirjailija, jonka laajaan tuotantoon kuuluu niin rikoskirjalllisuutta, lastenkirjoja kuin Jazz-romaaneiksi nimetty sarjakin. Mäntylä on ollut myös toimittamassa useita tekstiantologioita.
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