The authors show that the potential benefit to a host country of forward markets or of foreign exchange guarantees depend on the investor's country of origin and on specific characteristics of investment. They show this in terms of the effects on foreign-exchange risks and on the amount of...

The author presents a tariff index that uses constant-elasticity-of-substitution aggregators of tariff line data to calculate how preferential tariff reductions affect both prices and average tariff rates. A simple general-equilibrium model with sector-specific factors of production can be...

A few years ago, many western companies were eager to consider investing in Eastern Europe and, more recently, in South Asia, where ongoing reform, large domestic markets, and cheap but qualified labor are transforming the region into a potentially fierce competitor for foreign direct investment...

Exports respond unpredictably to a change in real exchange rates, suggests evidence from the 1980s. Recent theoretical work explains this as a consequence of the sunk costs associated with breaking into foreign markets. Sunk costs include the cost of packaging, upgrading product quality,...

Given the lack of direct evidence regarding industrial adjustment in response to trade liberalization, this paper tackles some very basic questions. Specifically, in LDCs, how is trade orientation correlated with the size distribution of plants and with plant-level labor productivity? It begins...

This paper is an effort to bring together diverse literatures on the measurement of productivity and its relation to trade regime, focussing on recently developed techniques and their applications. It provides a brief review of the theoretical arguments linking trade policy and productivity....

This study identifies the macro conditions under which industrial growth and financial stability are most likely, and those conditions which are most prone to create disaster. The paper models interest rates, exchange rates, and aggregate demand conditions as affecting industrial growth and...

Technical, scale and allocative inefficiency are widely believed to plague the industrial sectors of developing countries. This paper presents a way to measure this inefficiency with imperfect data. There is great interest in documenting the patterns and magnitudes of inefficiency, so that...

In this paper, the authors provide systematic panel-based econometric estimates of plant-level returns to scale for various 3-digit and 4-digit manufacturing industries, using panel data for Chilean plants. The paper attempts to answer two questions: 1) Do policies that promote"bigness"in...

Some economists have urged reliance on fuel taxes and other fiscal incentives to reduce air pollution in semi-industrialized countries. They argue that policies that act on relative prices are easier to enforce than those based on emission monitoring, create less misallocation of resources, and...