Ideas to Action:

Independent research for global prosperity



February 3, 2017

Trade Misinvoicing in Developing Countries

This paper discusses selected issues in the analysis of trade misinvoicing. It starts by examining various motives for the misdeclaration of trade activities. It is argued that the broad range of incentives to fake customs declarations provides an important challenge for the empirical assessment of the extent of trade misinvoicing. After analyzing the costs and benefits of different empirical approaches to quantifying trade misinvoicing, the accuracy and reliability of estimation results reported in the literature are reviewed. It is shown that quantitative findings are heavily dependent on the underlying assumptions in the empirical analysis, making estimation results on trade misinvoicing practices largely a matter a faith.

March 29, 2016

How Much “Mega” in the Mega-Regional TPP and TTIP: Implications for Developing Countries

There is no question that the “mega-regional” trade deals in the Pacific and across the Atlantic are big. If completed and implemented, they will cover a large portion of global trade and investment. This paper examines the TPP text to identify provisions that are more or less development-friendly, especially for Vietnam, which is the poorest signatory to the deal by far. It concludes with with recommendations for US and EU policymakers that would mitigate potential negative effects for developing countries and for the multilateral trading system, including rules of origin that minimize trade diversion.

December 22, 2015

The Role of Industrial Policy as a Development Tool: New Evidence from the Globalization of Trade-and-Investment

Emerging market countries that manage to diversify and upgrade their production and export base grow more rapidly and enjoy greater welfare gains than those that do not.  Foreign direct investment in manufacturing is concentrated in middle- and upper-skilled activities -- not lowest-skilled operations -- and thus offers many opportunities for structural transformation of the host economy.  But the challenge of using FDI to diversify and upgrade the local production and export base is fraught with market failures and tricky obstacles.  Contemporary debates about industrial policy as a development tool focus on how best to overcome these market failures and other difficulties.