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1 – 10 of over 44000Saeed Moshiri and Elham Kheirandish
Oil price shocks greatly impact the global economy, but the effects vary among countries. While higher oil prices benefit oil-exporting countries, they harm the economic…
Abstract
Purpose
Oil price shocks greatly impact the global economy, but the effects vary among countries. While higher oil prices benefit oil-exporting countries, they harm the economic performance of oil-importing nations, and vice versa for lower oil prices. However, economic relations, such as trade, can mitigate the impacts of oil price shocks on both groups. In this paper, the authors aim at estimating the effects of oil price shocks on the major net oil-exporting and net oil-importing countries while accounting for international trade.
Design/methodology/approach
The authors derive a reduced form of a macro model and set up a Panel VAR model to estimate the direct and indirect impacts of oil price shocks on economic growth. The sample includes data on macroeconomic variables from 30 oil-exporting and oil-importing countries that comprise more than 73 percent of the world's economy. The authors construct the spillover variables using bilateral trade matrix. To control for institutional and structural variations across the countries, they are divided into four groups of developed and developing oil-exporting and oil-importing countries.
Findings
The results reveal that all oil-exporting countries have significantly benefited from oil price shocks, although trade has dampened the effect. The positive growth effect has been more pronounced in oil-exporting developing countries. The impact of oil price shocks on oil-importing countries has been negative with a one-year delay, but not statistically significant, and trade has only had a small effect. The effect has been more substantial in oil-importing developing countries.
Research limitations/implications
One of the limitations of this study is the focus on trade as the main spillover channel. Given the data availability, other channels such as foreign investment and financial markets can also be included in future studies.
Practical implications
Removing trade restrictions would help both oil-exporting and oil-importing countries to mitigate the negative impacts of the oil price shocks. However, the asymmetric oil-macroeconomy relationship across oil-exporting and oil-importing countries puts oil-exporting countries in a more vulnerable position as they cannot rely on trade with oil-importing countries to reduce the negative impacts of lower oil prices on their growth. Therefore, it is crucial for oil-exporting countries to reassess their oil-dependent development plans and invest their oil revenues in non-oil sectors to diversity their economies and prepare for a future with reduced dependence on oil.
Social implications
The recent technological advances, structural changes, and increasing energy efficiency suggest that major oil-importing countries will become less dependent on oil in near future. As a result, oil-exporting countries will also need to undergo structural changes in order to sustain their income level. These significant changes will have important social implications, particularly in the labor market, during the transition, for which preparation will be necessary.
Originality/value
While the literature on the total impact of oil price shocks on either oil-exporting or oil-importing countries is rich, studies on their spillover impacts are limited. Recent research has shown that trade and migration can affect the impact of oil price shock on the economy in federated countries such as Canada. However, the trade effect on oil price shocks in the international level, where countries are subject to different regulations/restrictions and institutional variations, remains scarce. By considering the trade relationship between different groups of oil-exporting and oil-importing countries, the authors aim to contribute to the literature of the global impacts of oil price shocks on the world economy.
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José Pablo Montégu, Julio A. Pertuze and Carolina Calvo
The authors analyzed the effects of importing activities on both technological and non-technological innovation in Chile. They contribute to the literature by hypothesizing and…
Abstract
Purpose
The authors analyzed the effects of importing activities on both technological and non-technological innovation in Chile. They contribute to the literature by hypothesizing and testing the idea that importing activities can foster the introduction of product, process, marketing and organizational innovations in emerging market firms.
Design/methodology/approach
The authors used a combination of two economic surveys that included 1,347 Chilean companies. To test their hypotheses, they applied a variant of the Crépon-Duguet-Mairesse (CDM) model (Crépon et al., 1998) accounting for technological and non-technological innovation outputs. Specifically, four alternative innovation output indicators were used to measure the introduction of product, process, marketing and organizational innovations.
Findings
The results revealed that importing activities had positive effects on technological and non-technological innovation. Importers showed a significant advantage in the introduction of product, marketing and organizational innovations. Firms that both import and export (i.e. two-way traders) had an even greater advantage in the introduction of new or significantly improved products.
Originality/value
The authors demonstrated a relationship between importing activities and both technological and non-technological innovation that is novel and relevant, particularly at a historical moment when COVID-19 poses huge economic challenges to emerging market firms. As trade disruptions caused by the pandemic have predisposed some governments to favor protectionist policies, the authors warn that erecting barriers against imports can hamper the innovative success of local businesses.
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Štefan Bojnec, Imre Fertő and József Fogarasi
The purpose of this paper is to investigate the impacts of institutional quality (IQ) in exporting and importing countries on agro-food exports from the world's leading emerging…
Abstract
Purpose
The purpose of this paper is to investigate the impacts of institutional quality (IQ) in exporting and importing countries on agro-food exports from the world's leading emerging economies: Brazil, the Russian Federation, India and China (BRIC countries).
Design/methodology/approach
Measuring is based on using the gravity trade model and econometric panel data analysis for the period 1998-2009.
Findings
Agro-food exports from the BRIC countries, particularly Brazil and China, have increased. The Russian Federation has experienced stagnating and volatile patterns. Brazil and India have strengthened market shares in the existing importing markets, while the Russian Federation has experienced severe deterioration. The export of existing products is more important than of new products. Agro-food exports are positively associated with IQ and the size of the gross domestic product in exporting and importing countries, but negatively with distance.
Research limitations/implications
Among IQ variables, the focus is on the indices of legal structure and security of property rights and freedom to trade internationally in agro-food importing countries and the BRIC exporting countries.
Practical implications
Different institutions and their quality can affect agro-food exports differently. The impact of institutions is not uniform across product groups.
Originality/value
This paper adds the impacts of IQ on agro-food exports. Except for processed products for final household consumption, agro-food exports from the BRIC countries are positively associated with the quality of the legal structure, the security of property rights and the freedom to trade internationally as IQ in exporting and importing countries.
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Marisa Ramírez-Alesón and Marta Fernández-Olmos
This paper explores the importance of the importing intensity for different intermediate inputs depending on their source (internal sourcing or intra-firm trade versus external…
Abstract
Purpose
This paper explores the importance of the importing intensity for different intermediate inputs depending on their source (internal sourcing or intra-firm trade versus external sourcing or foreign suppliers) for different types of innovation (product and process innovation) and applied to MNEs (foreign versus domestic).
Design/methodology/approach
The sample contains 2,448 firm-year observations (2006–2016) of firms located in Spain that belong to an MNE group. The authors applied a conditional mixed process to a panel recursive bivariate probit model with robust standard errors.
Findings
The authors obtained three key results. First, intermediate imports do not always contribute to improving innovation, since their effects vary depending on their source. Second, intermediate imports from foreign suppliers (external source) are more advantageous for product innovation than those from intra-firm trade (internal source). Third, intermediate imports from intra-firm trade are more important for process innovation than those from foreign suppliers. Thus, the impact of importing intermediate inputs on innovation is contingent on the source of the imports, the ownership of the MNE and the type of innovation.
Originality/value
The paper contributes to this topic with new insights and results for MNEs. It identifies which import source is best for innovation depending on the type of innovative result expected. Moreover, it helps to uncover simultaneity and causal relationships between product and process innovation, issues which have not previously been considered in the literature.
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Draws on previous contributions about eastern Europe which examined both the preliminary investigation of market opportunities through desk research, and one of the most advanced…
Abstract
Draws on previous contributions about eastern Europe which examined both the preliminary investigation of market opportunities through desk research, and one of the most advanced forms of trading practice with the Comecon countries — industrial co‐operation agreements. Posits that this study complements earlier works with regard to East‐West business relations and east European importing organizations. Examines eastern European countries and their practices in depth and uses survey results to expand on this, and thirty‐six companies' responses to a questionnaire in late 1980 were used. Discusses principal findings and marketing implications along with suggestions for discovering relevant importing organizations. Suggests that the research findings will be useful to exporters and assist their efforts in selling in an extremely difficult market. Concludes with an example of the questionnaire used.
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Douglas E. Thomas and Robert E. Grosse
This paper examines both the imports and exports of nonmaquiladora Mexican firms, theorizing that importing is generally motivated by exploration for new resources and exporting…
Abstract
This paper examines both the imports and exports of nonmaquiladora Mexican firms, theorizing that importing is generally motivated by exploration for new resources and exporting by exploitation of existing resources. Our results indicate that firm size is positively related to both imports and exports, while low cost labor advantage is positively associated with exports but not significantly related to imports. Because importing may precede exporting, it should be considered as part of the internationalization process of firms and as a key way to acquire resources before exploiting them through exporting.
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Lynne Eagle, Philip J. Kitchen, Lawrence Rose and Brendan Moyle
Brand equity has received significant academic attention since the mid‐1990s. This has been driven partly by changes in international accounting standards as they relate to the…
Abstract
Brand equity has received significant academic attention since the mid‐1990s. This has been driven partly by changes in international accounting standards as they relate to the reporting of the financial value of intangible assets. A more prominent driver concerns the impact of marketing, and of marketing communication activity in particular, on brand performance. Much of the academic debate, however, has centered on conflicting definitions of brand equity and on seeking ways of measuring or quantifying the value of equity. Attention is now turning to examining the nature of equity and of factors that may threaten it. This paper examines the potential impact of parallel importing on brand equity and provides a substantive theoretical background. The paper then reports the findings from an exploratory study involving depth interviews with New Zealand brand managers whose brands have been affected by this activity.
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Süleyman Değirmen, Cengiz Tunç, Ömür Saltık and Wasim ul Rehman
The authors empirically aim to study the implications of uncertainty generated by oil price volatility on some key macroeconomic variables, including production, exchange rates…
Abstract
Purpose
The authors empirically aim to study the implications of uncertainty generated by oil price volatility on some key macroeconomic variables, including production, exchange rates and interest rates, of both oil-exporting and oil-importing countries. Using a block exogeneity structural Vector Auto Regression (VAR) model that mutes the effects of domestic variables on global factors and that is suitable for small open economies because of significant differences in the responses of domestic production in oil-importing countries will most likely decrease through reducing planning horizons, postponing investment projects and relocating resources more inefficiently.
Design/methodology/approach
The authors integrated into the structural vector autoregressive (SVAR) model the block exogeneity feature since all the countries in this study are small open economies that cannot influence the global economic variables. The block exogeneity feature imposes the restriction that the domestic variables have neither a contemporaneous nor a lagged impact on the global variables. This model has eight variables: oil price volatility, world demand and federal funds rate as the global variables; and domestic production, monetary aggregate, inflation rate, exchange rate and interest rate as domestic variables. The authors assemble the data for 12 developing countries for which the necessary data for the analysis are available: six oil exporting countries (Russia, Saudi Arabia, Iran, Kazakhstan, Mexico and Colombia) and six oil importing countries (Turkey, India, Philippines, Poland, South Africa and Indonesia).
Findings
The results point out significant differences in the responses of macroeconomic variables to oil price volatility shocks between oil-exporting and oil-importing countries. Furthermore, the local currencies of these countries depreciate due to concerns about possible current account worsening. In response to the shock, domestic interest rates are reduced so as to alleviate the negative exposure of the shock on domestic economic activity. While domestic production in some oil-exporting countries (i.e. Russia, Saudi Arabia and Iran) increases during oil price uncertainty; in some other countries (i.e. Mexico, Kazakhstan and Colombia), domestic production decreases.
Originality/value
Several components of the study contribute to its novelty. One of them is the period under consideration. The time frame that encompasses the most significant geopolitical and financial events, such as the Middle East Spring and the global financial crisis of 2007–2008. The research was conducted using the block-exogeneity SVAR model, which includes 12 oil exporting and importing developing countries. With this model, the global dynamics, particularly the energy market, that these nations may influence and are influenced by, i.e. global and nonglobal factors can be constrained. This makes it easy to determine the various effects prices have on macroeconomic variables.
Highlights
Oil prices and volatility still matter to the global economy
Monetary and fiscal policy interventions in response to oil price volatility create uncertainty and impede investment activity
The response of macroeconomic variables to volatility shocks in oil prices varies across oil importers and exporters
Interest rates help stabilize production in oil-importing economies that have well-functioning financial markets
Oil prices and volatility still matter to the global economy
Monetary and fiscal policy interventions in response to oil price volatility create uncertainty and impede investment activity
The response of macroeconomic variables to volatility shocks in oil prices varies across oil importers and exporters
Interest rates help stabilize production in oil-importing economies that have well-functioning financial markets
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Chae Won Hwang and Song Soo Lim
The purpose of this paper is to analyze the impacts of differences in sanitary and phytosanitary measures as non-tariff measures (NTMs) in the tea trade between importing and…
Abstract
Purpose
The purpose of this paper is to analyze the impacts of differences in sanitary and phytosanitary measures as non-tariff measures (NTMs) in the tea trade between importing and exporting countries. With the progress of trade liberalization, there has been a shift of focus to NTMs as alternative or potential trade barriers.
Design/methodology/approach
In order to quantify an NTM on tea trade and implement its empirical application, this study designed an index of differences in maximum residue levels (MRLs) for the pesticide endosulfan and introduced it into a gravity trade model. The estimation challenges in the presence of heteroscedasticity and many zero-trade flows are resolved by taking the Heckman and Poisson pseudo-maximum likelihood estimators.
Findings
This study found that differences in MRLs, arising from the stricter standards in importing countries lead to a significant decrease in tea trade value. This negative impact of differences in MRLs is found to be slightly less than that of tariffs, implying that in this case, the NTM acts as a policy substitute for import tariffs in the global tea trade.
Originality/value
The main contribution of this study is to suggest and quantify the differences in MRLs across countries as a substantial NTM on the global tea trade and provide its empirical application.
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Marisa Ramírez-Alesón and Marta Fernández-Olmos
The purpose of this paper is to analyze the impact of imported intermediate inputs on innovation performance, differentiating among types of innovation output (product and process…
Abstract
Purpose
The purpose of this paper is to analyze the impact of imported intermediate inputs on innovation performance, differentiating among types of innovation output (product and process innovation) and considering both family and non-family firms in the Spanish context.
Design/methodology/approach
This paper uses an unbalanced panel of 1963 firms in the Spanish manufacturing sector (13,155 observations; 2006–2016) that can be identified as family or non-family firms. The authors apply a recently developed methodology (conditional mixed process model) that takes into account the possible relationships among the dependent variables to a panel bivariate probit model with robust standard errors.
Findings
Importing intermediate inputs is an important source of process innovation for all firms, but not of product innovations. Significant differences were found between family and non-family firms in favor of the family type.
Research limitations/implications
This paper breaks down the family state into two categories (belonging to a family group or not) because the database does not contain information regarding the percentage of family ownership or the number of family members in the management structure. Moreover, the research is context specific.
Practical implications
These results will be useful for firms that are considering the value of importing intermediate inputs as a strategy to improve their process innovations, particularly for family firms.
Social implications
Family firms are more successful in the utilization of imported intermediate inputs to achieve greater innovation performance. If family firms are more competent in leveraging their intermediate input imports in innovation performance, it should contribute to increasing business performance.
Originality/value
The research on imports takes into account the different impacts of intermediate imports depending on innovation performance (product innovation vs process innovation) and the nature of the firm (family firms vs non-family firms).
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