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Some countries increase subsidies in order to decrease the world price, using their large market share. The main difference between subsidies and investment is productivity, investment increases productivity, while subsidies increases production. Subsidies are only a fast tool to decrease the cost of productivity which leads to a decrease in the final price in order to increase the comparative advantage, trying to gain high income with lower profit from exporting high amounts of production. Once you decrease subsidies production will decrease as well. While investment increases productivity which is seeking for new technology, increasing the cultivated area productivity, or high skilled labor.
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Is there any publicly available dataset that provides internationally-comparative economic variables, including government expenditure, population, territorial size, per capita GDP, trade, infrastructure, conflict events, etc from 2000 onwards ?
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Hi Bishal,
You will get data for almost all the mentioned variables on World Development Indicators, Word Bank database. https://databank.worldbank.org/source/world-development-indicators
For trade volume related data- Several database are available such as UN-Comtrade, ITC Trade Map, WTO Database.
Hope this helps.
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While the phenomenon of the Fourth Industrial Revolution is well-described and supported by many particular cases, the overall picture remains meager. The scale of the Fourth Industrial Revolution's disruptive impact on the global economy is unclear. Thus, how do we measure the impact of the Fourth Industrial Revolution on the global economy nowadays? What are the currently available shreds of evidence of the Fourth Industrial Revolution's impact on the global economy in terms of resources relocation and industries restructuring? How dramatic is this impact? How do we measure it? What are the variables? What data or literature would you recommend in this respect?
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In terms of such multifaceted issues, it is worth conducting a comparative analysis in which individual highly developed and / or developing economies will be compared, taking into account various determinants of the impact and shaping the scope of the participation of individual technologies, including Industry 4.0 technology and other technologies typical for the current, fourth revolution technological in the context of various macro-determinants of the country's economic development.
Best regards,
Dariusz Prokopowicz
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I want to focus upon the external dimension of European Green Deal. Since I am a student of International Economics, I would prefer working within the field of International Relations/ International Political Economy.
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Energy security of European countries and the influence of geopolitical economic factors on energy dependence.
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Usually we use the two terms interchangeably in our articles but whether is there any technical difference between them?
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I guess the difference is in the words implication Vs recommendation. Implication is the outcome result following your analysis, while recomendation is what you proposed or your choice of outcome to follow.
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Particularly, it is for the analysis of Free Trade Agreement's impact on country's trade using panel data. As you know, gravity model and the variable have several econometrics problems. How can this be overcome in order to get the best result with the proper estimation method?
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My question is simple, how do you view decision making in SME who are in the process of internationalisation or has already passed the stage of internationalisation. Is there any difference compared to larger firms? Is sarasvathy ( 2001) right in her assumption that firms dealing with a high level of uncertainty often opt for an effectual logic?
I co- authored an article about this that can be found here:
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Dear @Henrik G.S. Arvidsson, I agree with @Dag Bennett.
I also would like to say... irrespective of size, the willingness to take risk differs. Therefore, though important, size is not the only decision-making variable.
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Data starting in the early 1900s or before, with a broad cross-country representation would be great.
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The MacroFinance and MacroHistory Lab in Bonn can be of some help with data on exports, imports and IP sin 1870 for 17 countries. You can find it here: http://www.macrohistory.net/data/
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Everyone knows intuitively that technology, especially one that can develop its "intelligence" through learning, displaces and will displace people from the labor market. How do you think what other legal or social consequences, besides losing a job, may result from this? Will it affect every country where international production takes place? Will there remain places where it will still be profitable to use the work of human hands?
Thanks in advance for any thoughts.
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Because due to the implementation of artificial intelligence in manufacturing processes in enterprises, to improve logistics systems, improve the provision of information and other services offered via the Internet, so many people may lose their jobs over the next few years. Therefore, the employment law regulations should be updated with the above-mentioned problems. In addition, it is important to create legal regulations that will shape the functioning of enterprises in which all production processes will be carried out by robots equipped with artificial intelligence. An important issue is updating the tax law in accordance with the answer to the question: How should enterprises be taxed in which all manufacturing processes will be carried out by robots equipped with artificial intelligence.
Regards
Dariusz Prokopowicz
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I am currently assisting on a research on cross border capital flows.
A common problem seems to be that both the acquisition of assets and valuation effects determine the cross border asset holdings as , for example, reported in the CPIS data. Hobza and Zeugner use the BoP statistics on portfolio investments to derive valuation effects on portfolio debt and equity (change in asset holdings minus acquisitions) (2014).
I am wondering if the valuation effect could also be estimated because I do not only want to distinguish between portfolio debt and equity but also between different types of instruments.
For instance, between different debt maturities.
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Valuation effects depend on inflation, exchange rates and liquidity (on how tightly held the asset is).Different financial markets have different levels of liquidity.
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The negative sign of outflows means the disinvestments by domestic investors in foreign economies, so actually it is inflows because domestic investors are pulling money from abroad to local economy, in contrast, the negative sign of inflows means the foreign investors are pulling money from the local economy to their home abroad, so it is actually outflows. IMF uses this method which is known as "BPM6" to report capital flows. Bear in mind that the outflows of FDI, FPI and other investments are reported as an assets and the inflows of FDI, FPI and other investments are reported as liabilities. With that being said, how could we calculate the net capital inflows and outflows? For more clarification I have added an attachment of Argentina's capital flows for the year 2000, Argentina had positive FDI and FPI outflows in that year for quarter 1, but other investment outflows were negative, so that means that other investment outflows are actually inflows because of the investments repatriated home by domestic investors. In the same period, in terms of inflows, Argentina had positive FDI and FPI inflows, but the other investments inflows were negative, so the other investments inflows are actually outflows. Therefore, in order to calculate net capital inflows we add the absolute value of the other investment outflows to the positive values of FDI and FPI inflows(|-other investments outflows|+FDI inflows+FPI inflows). The same thing for net capital outflows, we add the absolute value of negative other investment inflows to the positive values of FDI and FPI outflows (|-other investments inflows|+FDI outflows+FPI outflows).
Am I right???
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I think IMF BPM6 is more in line with definition of asset and liability in accounting. An inflow should be a liability to the host country From the perspective of creditor/investor who is entitled to a return while outflow of investment is an asset.
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Help needed.
I am currently looking to come up with a research questions for my bachelor thesis. I study International Relations but I wanted to narrow down my profile towards economic because of my plans for my postgraduate education.
We agreed with my supervisor in this topic : "Forms of Capitalism and EU governance"
I am reading an enormous amount of papers and academic works for days now but I cannot come up with a research questions that successfully creates a bridge between forms of capitalism and EU.
Any ideas on the questions would be welcome. Any suggestion of papers I can read would be welcome.
Thank you
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Rej Kasi feel free to check my bachlor thesis on RG. I made a relatively comprehensive analysis of the economic conceptions rooted in the process of codifying European treaties. Even if the work is in French and applies mainly to Western and Southern Europe, the fundamentals are present. For information purposes, the work corresponds quite amply to the traditional requirements of a Bachelor thesis so it can serve as a structuring framework. To go even further in different forms of capitalism and work in European political economy, I recommend the work of Bruno Amable (2017) and Stafano Palombarini.
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In international trade theory, HO or Heckscher-Ohlin-Samuelson model and its variants Heckscher-Ohlin-Vanek model and North-South HOS models played a dominant role in trade theory and policy. However, starting from Leontief paradox, Leamer and Trefler and others in 1990’s revealed its irrelevance. In the context of South-North questions, Joel Hellier (2012)’s comprehensive assessment shows that NS-HOS models are in the same state. Who still dares to defend HO models?
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Dear Xiaojie Liu
thank you for your frank argument. The fact that no professors teach HO theory in the phd courses does not matter. If most of problems that can be explored by a theory, it will cease to be taught. HO theory is still important because it is still binding economists' way of thinking. As you argued, you jump to think proportions between capital, labor and perhaps technology as factors of production. This habit of thinking is formed by HO theory. But is it reasonable?
My contention is factor proportion theories (HO theory is only an example) are all wrong.
(1) First, it has no good predictive powers. See controversies in 1990's vis-à-vis HOV models.
(2) Theoretical framework of factor proportion theories contains many serious theory troubles. To cite only two of them, (2a) measurement problem in capital theory and (2b) aggregated production functions. For the latter, see
Felipe and McCombie 2013 The Aggregate Production Function and the Measurement of Technical Change: 'Not Even Wrong' , Edward Elgar.
Aggregate production function is in a great probability misidentifying accounting identity as production functions as Herbert A. Simon pointed it in is Scandinavian Journal of Economics when he got a Nobel Prize of Economic Science.
(3) They give erroneous footlights on less important questions instead of more important issues. For example, technology is understood in a very superficial way and misleads people to wrong questions (especially the people of less developed countries). Factor proportion theories have strong tendencies to consider technology as something which can be bought by money.
You should also remind that Ricardian theory has been renovated in these ten years or so. First, what is understood as Ricardian theory in schools is not what Ricardo thought but an invention of John Stuart Mill.
See
Gilbert Faccarello (2017) A Calm Investigation into Mr Ricardo's Principles of International Trade, and
Yoshinori Shiozawa (2017) An Origin of Neoclassical Economics: Mill's 'Reversion' and its Consequences.
Second, a new general theory (the new theory of international values) in the Ricardian tradition is now build. It is much superior than four generations of neoclassical trade theories (textbook Ricardian, HO theory, New trade theory and New new trade theory). For example, the new theory of international values is a theory which permits input trade in a general form (Ricardo-Sraffa trade economy). This is the theoretical basis for the analyses of global value chains (GVCs), because GVCs are network of productions and international trade. Please note that above four generations preclude input trade by assumption or is practically a theory of small open economy as it is the case of New New Trade Theory. The new theory of international values is free from such theory questions of capital measurement and aggregated production functions, simply because it does not draw on such concepts and constructions.
Third. Another essential difference between the new theory of international values and HO theory is the theory of wages. HO theory has no good theory except factor price equalization theorem. The theorem claims that wages of all countries are the same in the factor proportion equalization cone. It is evident that this kind of theory cannot be used to analyse rich and poor counties problems, because this is practically the question that a rich country's workers gains higher wage rates than those in poor countries. The new theory of international values is a theory by which we can determine wage rate of each trading nations. Thus, workers of a nation gain five or twenty times as much as those of a poor nations. This big difference of wage rates between countries does not come from the difference of factor proportions. Wages depends on the technology (in other words, the set of production techniques that a nation [or firms of a nation] possesses) .
The first task that a poor nation must tackle is to change their production techniques to more productive ones. It does not mean to buy a new technology from abroad. By a change of production sites, productivity of production techniques can be changed tremendously. In this changing phase, foreign capitals' firms may give a good stimulation, but what is important is the efforts of workers (including directors and engineers) on the production site. It is also necessary to note that social infrastructures like roads and ports influence the total productivity of a nation, because transportation is an important part of production techniques.
Sarbajit Chaudhuri recommended Xiaojie Liu's post. It is a great pleasure that he is interested in our question. Please join us and give your opinions about international trade theory and its relations to development economics.
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I would like to test the relationship and impact of FIIs investment of particular company on company's equity price and also want to know the impact of FIIs investment on Stock Index. Pls suggest me, what are the statistical tools  good for conduct? I am using 10 years data.
Thank you,
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You can refer the above paper too @munji shanmukharao
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What is the purpose of the AR Roots graph in Eviews when dealing with VECM?
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If a time series is stationary, the roots of its characteristic polynomial will lie outside the unit circle. What does that mean?
Imagine you have the following AR(p) process:
y(t) = a(1) y(t-1) + ... + a(p) y(t-p) + e(t)
We can equivalently express this as:
(1 - a(1)L(1) - ... - a(p)L(p)) y(t) = e(t), where L is the lag operator.
let z^k = L(k), then we can express the characteristic equation as:
1 - a(1)z^1 - ... - a(p)z^p = 0
We have parameters a(k), so we can solve this equation for z^k. These are called the roots of the characteristic equation (which are guaranteed to exist by the fundamental theorem of algebra).
If all of the roots of this polynomial lie outside the unit circle (i.e. > 1), then the process is stationary. Eviews shows inverse roots (the reciprocal of the roots). If all inverse roots lie within the unit circle, equivalently, the process is stationary.
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Unemployment must be an important question also in trade theory. However, we see no many papers or books that argued and analyzed involuntary unemployment in trade theory. If you know any papers and books that treated Keynesian unemployment in relation to international trade, please teach me.
What I know is only a few:
(1) Harrod, R.F. (1939, 1949) International Economics, Second and revised edition.
(2) Robinson, Joan 1965 Inaugural Lecture, Cambridge University. (On New Mercantilism)
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That‘s nothing new. The GATT is held up as having systematically reduced trade barriers through periodic rounds of negotiations between its member states. However, although its members accounted for most of international trade, even by 1967 they were no more than 50 in number: very many newly independent countries and other smaller states did not join.
And the GATT had two major exceptions to trade liberalisation. The first was in agriculture, which its members were allowed to protect for purposes of food security. There was a strong case for this (and there still is), but it had the side-effect of making it more difficult for commodity-dependent developing countries to export some of their most important commodities.
The second was the Multi-Fibres Arrangement (MFA), which was introduced in 1974 as a temporary measure but repeatedly renewed until 2004, ten years after the creation of the WTO; and a previous arrangement for cotton textiles had started in 1961. The MFA imposed national quotas on non-members’ exports of textiles and clothing to GATT members. And if a country didn’t have a quota, it could be hard work to acquire one. Since this tends to be the first sector to industrialise in most countries, the MFA acted as a serious brake on poorer countries’ industrial development.
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I'm interrested in measuring the volume, the motivation, the institutonal settings and the economic effects of high skilled migration with special focus on Central Asia
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Dear Dr. Manfed Sargl you have raised the world wide growing concern that has a very serious impact on economy, health, education, etc in the developing countries.Brain drain is defined as the migration of health personnel in search of the better standard of living and quality of life, higher salaries, access to advanced technology and more stable political conditions in different places worldwide ( Dodani and LaPorte, 2005).Yes you are right dear Dr. Manfed Sargl . The majority of migration is from developing to developed countries.The main drivers of brain drain are:
  • Better standards of living and quality of life,
  • Higher salaries,
  • Access to advanced technology and
  • More stable political conditions in the developed countries attract talent from less developed areas.
So, addressing the aforementioned gaps can minimize brain drain from the developing countries.
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I am thinking of writing a dissertation on the same.
Thanks.
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These 2 references by the same renowned author my be helpful particularly in comparative analysis.
1-Maddison, A. (2003). The world economy: Historical statistics. Paris, France: Development Centre of the Organisation for Economic Co-operation and Development.
2-Maddison, A. (2007). Contours of the World Economy 1-2030 AD: Essays in Macro-Economic History. Oxford: OUP.
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"The rise of Global Value Chains (GVCs) has dramatically changed the organization of world production of goods and services in recent decades." Sónia Cabral (2016) thus remarks and continues that "GVCs cannot be perfectly understood with the traditional concepts of comparative advantage applied to countries and broad sectors." She then put it: "In theoretical terms, a comprehensive framework encompassing the specificities is still lacking." (Cabral 2016 p.279)
Satoshi Inomata (2017) implicitly reconfirms Cabral's proposition in his introductory chapter of the new biennial report (WTO et al., 2017) by putting line heading "The global value chain paradigm: New-New-New Trade Theory?".
Is Cabral and Inomata's observation true? My humble but bold contention is different. The new theory of international values presents such a theory that explains what drives the rise of GVCs and how such a process goes on (See Shiozawa 2017) at least from 2017. How do you think of this point?
References
Cabral, Sónia (2016) Global Value Chains: A Survey of Drivers and Measures. Journal of Economic Surveys 30(2): 278-301.
Inomata, Satoshi (2017) Analytical Frameworks for Global Value Chains: An Overview. Chapter 1, pp.15-35. In WTO et al., Global Value Chain Development Report 2017 (Measuring and Analyzing the Impact of GVCs on Economic Development).
Shiozawa, Y. (2017) The New Theory of International Values: An Overview. Chapter 1, pp.3-73. In Shiozawa et. al., A New Construction of Ricardian Theory of International Values, 2017, Spinger, Songapore.
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Dear Sebastain @Sebastain Uremandu
Thank you for posing this very basic question and giving me the chance to answer it.
A value chain is a network of productions and exchanges that ends to the production of a final good. As almost all industrial products are produced by using many kinds of materials, parts and components, each product has its own value chains. Before 1970's, the value chain of majority of products extended only within a country, if we excludes a few number of imported materials. Since 1970's the value chains began to extend beyond national boundaries. They grew very rapidly since 1990's and the value chain of some products now extends all over the world. Such a value chain is called global value chain.
For example, more than half of all i-Phones are made in China. Apple buys many components like the memory chip, the modem, the camera module, the microphone and the touch-screen controller from more than 200 suppliers around the world. An estimate tells that, out of a total of $370.25 total cost of i-Phone X, $110 goes to Samsung Electronics in South Korea for supplying displays, another $44.45 goes to Japan’s Toshiba Corp and South Korea’s SK Hynix for memory chips. The assembler in China, like Foxconn, gains value-added of only an estimated 3 to 6 percent of the manufacturing cost. (Reuters #BUSINESS NEWSMARCH 21, 2018 / 9:05 PM)
You can see how some of values chains are globalised. We talk often of globalization. There are many aspects in it. The real economy side of globalization is represented by the rapid growth of Global Value Chains (GVCs). Innomata (2017) tells that 60 per cent of global trade now consists of trade in intermediate goods and services.
GVCs have brought big consequences for economies participating to GVCs. Recent East and South East Asian economic development (including China) cannot be understood without the growth of GVCs. Climbing-up the GVC ladder is now a national strategy for some countries to avoid the middle-income trap.
Despite of the importance of GVCs, the traditional trade theories were rather incompetent in explaining the growth of GVCs. Three generations of trade theories (textbook Ricardian trade theory, Heckscher-Ohlin-Samuelson theory, and New trade theory) all excluded trade of intermediate goods by assumption. The theory of the fourth generation, called "New new trade theory," is in essence a theory of open economy of a country and cannot be a theory of GVCs. This explains why arguments on GVCs started in disciplines other than economics, like sociology, organizational theory and others. An economic theory that can explain growth of the GVCs is seriously required but no traditional theories can respond to this requirement. Hence my question. For more details, please read two reports in the references: Cabral (2016) and Inomata (2017).
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I have read in many papers that remittances can lead to domestic currency appreciation. However, I am more interested if someone can point out balanced theories and arguments of how inflow of remittances can cause currency depreciation aside from only appreciation.
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Need Micro Data of the Volume of Derivative Instruments  used by Chinese companies for hedging exchange rate and interest rate exposure.
Right now I look at every annual report but unfortunately some reports are only in Chinese. Is there any data already collected for the years 2010-2013 or any faster way to collect the data?
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I'm currently working on a critique of the WTO using liberal economics epistemology and I would need the information that I'm asking for to present a recount of Human Rights Academia critiques to the WTO. 
It does not matter if the articles are published in academic journals or the press as long as they do it from a HR perspective. 
Thank you everyone for your help. 
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check this
Focus on the Global South |
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countries use their foreign exchange reserves to keep the value of their currencies at a fixed rate, could be replaced with Cryptocoin 
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I think the literature is fairly clear that the transactions themselves do not matter for the value of a currency, but the demand for inventory of a money does. So dollar credit does not so much affect the velocity of money as people shift from using dollar currency or dollar deposits to dollar credit, to say a credit card. What matters is that someone is holding dollars to pay my credit card charges instead of my holding it, so the total demand for dollars is not affected by whether I hold and use dollars or a creditor holds and uses dollars to pay my credit card charges. The same is true if we imagine buying French goods in France in euros or buying them in stores in the US using dollars. No effect on the demand for dollars or euros. 
If the demand for bitcoin holdings rises relative to dollars that is a different matter. As noted above, however, that is not happening in two very important senses: the quantity of bitcoin is very small relative to the supplies of most currencies and transactions using bitcoin are not affecting the demand for any currency relative to bitcoin. So far, perhaps mainly due to tax policy, bitcoin are not much of a substitute for dollars as money because of the volatility and because of the tax treatment of bitcoin as an asset in many countries. So far bitcoin is not money, even though it is used in some third party transactions, because it is a poor store of value or as Friedman put it, a poor "temporary abode of purchasing power." 
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Please if you do not have a theoretical framework put your answers in bullets.
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The crisis of rising expectations and the failure of the new, young leadership to bring any changes sparked events, but despite the fact that each country suffered from the same problems, their situations brought different results.  Gamal Mubarak was promising, but then disappointed.  Saif Ghaddafi, Bashir Assad and King Abdullah II are also in those molds.  However, the make up of society in Egypt is not that in Tunisia, or Libya, or Syria or Jordan.
Hence, while we can easily categorize and generalize about the causes (Iran included), the results cannot be so easily put into a theoretical model.
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I want to assess the effects of US unemployment on the ratio of US consumer demand for Chinese manufactured products to US consumer demand for US products. The idea is that decreased manufacturing employment in the US (partly caused by imports from China which are caused by the supply shock in China (Autor, Dorn en Hanson, 2013)), results in lower household income, which in turn increases demand for cheap Chinese products (relative to the demand for US products). I want to use the approach of Autor et al. in the sense of using the same commuting zones in the US. So, it will be a panel data study. I have two problems:
-I need variation in Chinese imports for each commuting zone. Is there data available on this?
-How to solve the endogeneity problem caused by reverse causality? I will need a good instrument.
Thank you in advance for any remarks/answers. I also appreciate it if someone knows related literature, since I haven't found anything empirical on this relation yet.
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Dear Ttia Burg, 
Try United Nation Comtrade Database https://comtrade.un.org/
Best wishes
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Does anyone know of reports/publications that analysis university spin-outs and the royalty rates agreed with the parent University or Institution? Any case studies or meta-analyses would be helpful to us.
Also, an associated question.  If a university holds equity in the spin-out, how much does that reduce royalty rates?
I know these are difficult questions, but I am thinking that someone may have compiled examples, which would be helpful to us. 
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thanks Idaver, the CMU document is really useful
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I am currently doing research on economic integration and FDI relationship. I have looked on websites of UNCTAD and OECD but I am unable to find bilateral FDI data. I found data on UNCTAD but it is only from 2001 to 2012 whereas I am looking for data dating back to 1990. Any help would be much appreciated. Thank you.
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UNTAD: Investment and Enterprise division
World Bank Investment Division
The Division is recognized as a global center of excellence on issues related to investment and enterprise for sustainable development. Built on several decades of successful experience, its staff provide international expertise in research and policy analysis, inter-governmental consensus-building, and technical assistance to over 150 countries. Its flagship product is the annual World Investment Report and its main global stakeholder event is the biannual World Investment Forum. The Division also maintains the interactive World Investment Network of over 9,000 members to disseminate and promote all its work on investment and enterprise.
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Hello everyone.  I want to know what countries do to attract FDI after relief of sanctions. Thanks a lot. 
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Dear Abbasi, 
I found out visa facilitation to boost FDI in general. Other variables have also been investigated accordingly. 
I enclose the paper for your attention.
Best regards,
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The number of trades and the volume of dollars just in the US is enormous. I'm wondering about the connection between the amount of dollars that are used for financial transactions and standard correlations to macroeconomic variables; something like correcting M1 for a part being siphoned off to be used almost exclusively for financial transactions.
And if anyone has already done this, can you tell me the study?
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There is an open data site. You might find it there.
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Dear all,
I really appreciate if anyone can tell me some databases on trade statistics before 1950 (and better in the 19th century). I mean trade data at world scale, not those on a particular country (e.g. US export data).
Thank you!!!
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Dear Yue Teng,
Have your checked the United Nations Statistics Division (see the enclosed pdf)?
All the best,
Monica
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I need to measure net product physical labour productivity within a world industry by using World Input Output Tables. Can I use PPP exchange rates for this purpose?
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Dear Andrea,
I have been using another approach to problems like this. It involves valuing the international market value of a country. See
Clark, E. and K. Kassimatis, “An alternative measure of the ‘world market portfolio’: determinants, efficiency, and information content”, JOURNAL OF INTERNATIONAL MONEY AND FINANCE, Vol 30, n° 5, (2011) pp 724-748.
We use the methodology to generate  the "Market Index" in Financial theory, but the values are generated for each country. We use the USD as the base currency. If you are interested and the demo seels long and irritating, just go to the numerical example in the appendix. You can find country values and rates of return from 1980 to 2012 at https://countrymetrics.wordpress.com/blog/
The advantage of this approach is that it gives the values (and returns in international relative prices.
Best,
Ephraim
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According to Professor James Foreman-Peck, the language skill deficit costs Britain 3.5% of their annual GDP, roughly £48bn a year. An comprehensive ELAN study from the EC estimated that 945,000 European SMEs may be losing trade as a result of lack of language competence, resulting in the average loss per business over a three year period around €325,000. Is such data available for the US, who are known to be extremely monolingual?
Best I could find is a survey conducted in 2014 where they asked 2101 US companies and 14% reported a loss of business opportunities because of a lack of foreign language skills. But no ballpark figure of actual losses.
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The costs of language skills shortages and lack of expatriate training in Canada are similar to those in the USA.
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TPP (Trans-Pacific Partnership) before effectuation is the latest multi-national trade agreement and its ratification is now a big political issue for almost all participating countries.
In the recent republican national convention, Trump declared its opposition to TPP. Senator Sanders, who was a closely competing candidate for democratic party nomination, has expressed his opposition to TPP as well.
How do International Political Economy and International Trade Theory explain the strong opposition among people to free-trade agreement in general and to TPP in particular?
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Trump articulated the discontent that those dispossessed of jobs and prospects that is experienced as a result of the after-effects of globalization.  It was the policies of the elite, both Republican and Democrat, that produced those after-effects.  The dispossessed wanted someone to blame, and Trump offered immigrants, refugees, outsourcing companies, foreign investors, etc.  The results of the election prove that the dispossessed accepted Trump's "blame mongering!"  BUT, the economic reality is that the factory jobs have gone forever,  THAT is why Trump offered "infrastructure building jobs" as the source of "recovery employment."  BUT, once the infrastructure is built, those jobs will disappear.  This is a short-term solution.  Regrettably, at the moment this is the only time-frame that most people use.  The problem here is not economics but rather social psychology - the public just wants to "re-activate the American Dream," not to change it.  BUT, fundamental change is what is really needed.  What can be done?
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Graham occupies a singular position in the history of the theory of international trade. He oppose to the neoclassical theory since John S. Mill, which is based on the reciprocal demand. He claimed that the neoclassical approach contains “the vital defects” (Graham 1932 The Theory of International Values, Quarterly Journal of Economics, 46(4): 581-316.) I wonder if there are recent studies on F. D. Fraham’s theory of international values.
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I have checked four documents hinted by Jetty Ramadevi. I could read three of them. This post is my comment on the first document:
            Frank D. Graham, 1890-1949.
Jetty linked this to a website in Japan, which is run by a famous columnist and translator Hiroo Yamagata. The original article was written by Gonçalo L. Fonseca and made open in the History of Economic Thought Website, which had been sponsored by the New School for Social Research, of which Fonseca was a graduate student. The website once disappeared but revived under the sponsorship of the Institute for New Economic Thinking. Actual URL:
In the Wikipedia (English), we have an article Frank D. Graham but it is an article on a successful writer with the same name (middle names are different with the same capital D.). I sincerely hope that someone will create an article Frank D. Graham (economist) in Wikipedia.
Gonçalo’s article is concise and exact except for two points. The first point concerns the circumstance of Graham’s death. Fonseca writes that Graham was professor at the Princeton University “until his retirement.” In fact, Graham died from a fall at Palmer Stadium at eh close of the Princeton-Lafayette football game, when he was still an active professor at the Princeton. (See Richard A. Lester, In Memoriam, American Economic Review 40(2): 585-587, May 1950)
The second point is more controversial. Graham criticized the use of two-sector, two-country models adopted by majority of trade theorists. This is true but it is doubtful if his intention was simply to question the validity of a two-sector, two country model in more general many-commodity, many-country case. Graham criticized the well established tradition since John Stuart Mill to determine the terms of trade by the workings of reciprocal demands. Graham argued instead that, in a general case, there are common goods (link commodities) that are produced by more-than-one countries. The existence of commonly produced goods determines relative wages of linked countries, and by consequence, the product prices that are produced in those countries. He in fact claimed that the international values are determined by the same logic as the classical theory of domestic values. His criticism was not a simple existence of an equilibrium solution for a many-commodity, many-country model.
Fonseca writes also that
  • “It was in solving to 'Graham's Model' that Lionel McKenzie (1954) introduced the first proof of existence of a general equilibrium via a fixed-point theorem.”
It is true that McKenzie (1954) thought that he had provided a proof of existence of a general equilibrium, but this is a half truth because what Graham wanted was not such a solution in general equilibrium framework à la John Stuart Mill.
I cannot blame Fonseca, because his comment is widely accepted one. However, this common understanding reveals how Graham has been long misinterpreted. For the reason of this misunderstanding, I ask readers to read my paper (still in a form of working paper) An Origin of the Neoclassical Economics: Mill’s “Reversion” and its Consequences (the second draft of “Mill’s Reversion and an Origin of Neoclassical Revolution”), which I will upload soon.
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Dear All, 
I have price indices for Developed Countries and need data for Emerging markets (10 years Govt. Benchmark Bonds, price indices). 
Brazil, Russia, India, China, South Africa, Pakistan.
I will be grateful to you all.
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Try Bloomberg.
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I am doing doctoral study in above topic. Please suggest or recommend me research methodologies with related to above topic. I will check expansion of urban fringe in the Karachi, will construct variables pinpointing infrastructure deficiencies due to sprawl and at the last will check relation of these both variables with respect to economic inequalities.
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Dear Sayed, I suggest you to take a look at the article "Urban Sprawl: Diagnosis and Remedies" (by Jan K. Brueckner) http://irx.sagepub.com/content/23/2/160.short?rss=1&ssource=mfr
I think it could be helpful.
Good luck!
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I would like to analyse the performance of sections of agriculture such as crops and determine their likelihood to succeed on international markets thus justifying promoting investment in such subsectors. The interest covers agriculture, manufacturing and mining sectors? Investment opportunities are being considered in these sectors.  
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I am not quite familiar with agriculture, and mining? But in manufacturing sectors or business of manufacturing, I have written a Chapter of a book on International or Global Manufacturing Competitiveness. 
Take a look...
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in WinRats or Stata or any other software
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Hi, Tipe the following command in Stata:
help vec
if the package is not installed , you type: ssc install vec 
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We are looking for comparable data on (C)SR in different countries-for corporations in general and also for leaders in CSR (persons)? How to measure CSR in different countries?
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Dear Zhanna,
I have read the previous answers and honestly see them perfect! Just hope you will do the best in your research.
Yours,
Ehsan
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the 4th research about International trade,,please share me ideas my beloved friends.
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Greetings from Romania to Indonesia, greetings to the world!
According to the World Bank experts:
"Trade competitiveness is no longer about viewing exports and export performance in isolation. Increasingly, it is the result of strong interdependencies between imports and exports, as well as international flows of capital, investment, and know-how. In addition, modern, competitive services are vital as intermediate inputs to a high-performing private sector. Indeed, the interactions between all of these factors determine firm productivity. Through trade and foreign investment, developing countries can benefit from a range of ideas that come from abroad: intellectual property, trademarks, managerial and business practices, marketing expertise, and organizational models. The flows of goods, services, people, ideas, and capital are now interdependent and should be assessed jointly.
Finally, a phenomenon important to developing countries is the emergence and endurance of global value chain (GVC) production. The flow of know-how from developed to developing countries often takes place in the context of vertical trade and production chains that cross many borders from raw material to finished product. Taking advantage of that structure is a key determinant of industrial development in the 21st century. Developing countries can now industrialize by joining GVCs instead of building their own value chain from scratch."
Please check the tools for analysis developed by the World Bank:
and also a useful joint paper of the World Economic Forum Global Agenda Council on Trade & FDI and Global Agenda Council on Competitiveness:
and the Trade Competitiveness Map of ITC:
You could have a look at WEF Global Competitiveness Index (GCI), several subindexes are relevant for trade competitiveness, too.
However, first of all, as mentioned by Professor Yoshinori Shiozawa, we need a good definition of competitiveness in international trade.
Good luck!
Best regards from Romania,
Monica
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In International trade, to know about economic progress for the future. we have to measure by forecasting analysis. Could you possibly explain forecast of the economic in International trade?
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Two approaches for forecasting future in economics are possible. The first approach is used more frequently and it uses statistical methods. Future is extrapolated using past trend. Technically, there are many methods of implementation, but neural network just makes this forecast a bit more complicated. The basic principle here is that future dynamics is the function of the past dynamics.
The second approach is fundamental, but is used not so often. It may be based on calculation of general equilibrium and convergence to it. However, we often have the factors that emerge from nowhere (the so called “black swans”) that work as shocks for economic systems. Analysts usually write a lot about that, but it is technically difficult to calibrate the scale of such effects even if one knows that such event is highly likely to happen.
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suhaily hasnan
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Available on BoardEx.
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Migrants often have higher rates of self-employment than natives. Does the export industry benefit?
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Of course; you can rely on my 2 articles on Hong Kong development, in which I said that migration of people from Mainland China created enterprises because they had nothing else to do, and these SMEs were an engine for the export-oriented growth until the 1990s. But you can wonder if the example of Hong Kong can be generalized (probably not) as it benefited from specific circumstances.
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Why or why not?  What are the main factors involved in the current low oil prices?
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Yes. Fracking.
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I need to examine its effect on Iran's major oil rivals; Saudi Arabia, UAE 
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I think it will bring about a vital change in the area. however it is to keep in mind that the situation is changing in the area and will effect the relation between Saudi Arabia and Iran not only its bilateral relation but also international level. Iran and US is coming closer is also a point to be noted.
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The multilateral trade resistance term was introduced by Anderson & Wincoop (2003) to explain flows of trade 
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Dear Atif Rao, I suggest you to go though the third Chapter of  the joint work by UNCTAD and WTO entitled "A Practical Guide to Trade Policy Analysis." 
Good luck!
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A chapter of Paul Krugman's book Pop Internationalism (1997) is titled The Illusion of Conflict in International Trade. In this chapter, Krugman contends that trade problems between low and high waged nations are an illusion and there is nothing to worry from the globalization in trade. He even analyzes why many eminent writers (including Lester Thurow and Robert Reich) make such ridiculous arguments when they begin to discuss international trade. Krugman contends that they should learn the international trade theory that is taught in undergraduate economics class before they begin to argue on these questions, because it is the matter which requires special knowledge of a special field of economics.
Now, this is my question. Are the contents of the standard international trade theory sane in the sense that they reflect the reality of economies that are influenced by the rapid change of international trade? Is it true that the trouble attributed to trade is an illusion and the international trade theory is fundamentally right? Are the problems that international political economy argues under the subject of trade conflict all illusion? If yes, this must be a true charge against international political economy.
My opinion is that the standard international trade theory has some serious defects and Krugman is not aware of this grave fact.
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Good morning.
Interesting debate, indeed. First, I would say it is important to separate theories from empirics and perceptions.
National politics in developed countries has followed opinions and turned against trade after the 2008-2009 global crisis because of unemployment. Blaming trade was the easiest way and made it easy for politicians to blame unfair competition from developing countries. This may probably not resist a closer analysis, but it is another debate.
I take a theoretical perspective here and will focus on the following part: "Is it true that the trouble attributed to trade is an illusion and the international trade theory is fundamentally right"
First,  we cannot know for sure that a theory (be it on trade or on elementary particles) is fundamentally right. Theories evolve with time, revised and falsified by new data and new evidences (here, I am definitely Popperian . 
Second, even from the neo-classic perspective close to Krugman, the fact that trade is welfare enhancing should not lead to the conclusion that it is without troubles, at least if we take a dynamic perspective and look at transitions between "steady-states".  
Transitions can be long and painful. Besides the traditional gains from trade, trade in long term growth model is expected to boost technological progress (total factor productivity). And economists should know (thanks to Schumpeter, not a neo-classic, but certainly not a protectionist) that progress is also painful: creation is destructive.
My opinion (not backed with data, so it is of very limited value) is that because a series of structural and institutional changes in the world economy, space and time have started collapsing after the late 1980s. The emergence of global supply chains, the convergence of consumption models or the spread of international travel are just one of the indices of this smaller and faster world.
This had positive impacts (faster convergence between developing and developed economies during the 15 glorious 1990-2005 years and sharp reduction in poverty indicators) and negative ones (societies and workers had little time to adjust to the fast transitions, income distribution within countries worsen and structural unemployment --open like in some European countries or hidden through a larger informal economy, like in Latin America).
As physicists know, the damage caused by frictions increases with speed. But theory should not be blamed for the adjustment frictions.
Best regards,
Hubert
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I am looking for a case study on how countries are managing deficit. How did these countries manage to increase their revenues and reduce costs?
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Hello Roy: Thanks for the book,
Policies to reduce a budget deficit:
1)  Cut government spending
2)  Tax increases
3)  Economic Growth
4) Bailout
5) Default
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I'm actually trying to run a regression test in Stata for Cross-Section gravity equation using the variable Trade value (ltrd_val) as dependent variable with independents variables such as GNI (lgni) Distance (ldist) contig comlang comcol. I'm testing the country Togo and its bilateral trade partners for year 2013.
Ln(trd_val) = β0 + β1 Ln(gni) + β2 contig + β3 comlang + β4 comcol + β5 Ln(dist)
ltrd_val = Trade value between country "i" and country "j" (e.g. Togo "i" and Algeria "j"...)
lgni = Gross national income
lgnicap = Gross national income per capita
ldist = distance between country "i" and country "j"
limports = imports from "j" to "i" (e.g. Algeria to Togo) at time t
lexports = exports from "i" to "j"
Dummy vairables (0 or 1)
contig = Togo and country "j" neighboring countries ;
0 if not sharing borders and 1 if sharing borders.
comlang = Share official common language between Togo and country "j" ;
0 if not sharing and 1 if sharing.
comcol = Togo former colonisator the same as for country "j" ;
0 if not and 1 if same colonisator.
Is there any special way of organizing the compiled gravity equation data in excel file before importing to Stata for good manipulation? I have put in attached file, the excel file and the Stata *.dta file.
Any help would be really appreciated!
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Hi Kalgora,
I agree with Nguyen. It seems like you forgot a dimension of the gravity equation. The crossectional gravity equation has 2 dimensions: importer and exporter (or i and j). So you have to add log GNI of the partner country as well as log GNI per capita of the partner country.
Also, you might want to consider controlling for the multilateral resistance term.
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thank you mr.vahid mohammed I m greatful.
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Is there any recent research about determinants of banking flows between countries or between banks with a certain nationality to other countries? Determinants related to global push factors, local pull factors, variables that capture financial and non financial linkages.
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Hello Mafalda,
If you're interested, we have developed and estimated a theoretical framework to study cross-border banking between Euro Area participants:
Kind regards
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Which model is suitable for Forecasting Price of Export Product?
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Dear Tu Thanh Nguyen,
Let me add some words on your  research program. Just applying statistical model is measurement without theory. Please study the new theory of international values.
You may have an easy access to the field if you read my conference paper:
The New Interpretation of Ricardo's Four Magic Numbers and the New Theory of International Values / A Comment on Faccarello's " Comparative advantage "
You can also find references to some other papers.
Yoshinori Shiozwaw
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The Worldwide Governance Indicators are: 
Voice and Accountability
Political Stability and Absence of Violence/Terrorism
Government Effectiveness
Regulatory Quality
Rule of Law
Control of Corruption
However, instead of observing the percentile rank for Brazil, for the purposes of my research, I need the data concerning the individual ranking of each of the 26 Federal States and the Federal District.
Any ideas?
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Unfortunately I am not aware of such indicators. But would be interested to know and compare those with the South Asian countries' indicators.
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Dear Researchers
Please someone tell me,  what is the economic rational to take the cost of production (proxy by  wages) as exogenous variable in export supply function? please explain it i am very thankful to you
Regards
Sayed Irshad Hussain
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Dear Sayed, I’d try to explain it in the simplest way. 
As any other producer, exporters deal with production costs. One of them (maybe the most important in economics) is wage. As export supply depends on international prices then relative production costs are determinants. That’s why wages are considered as an exogenous variable. 
Best regards!
Ramiro
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Please , if anyone give the relations between these variables.
Best Regards,
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Dear Sir, 
Both the commodities Gold and Crude oil have positive relation with each other and almost follow the same pattern (ups and downs). However, their is a negative correlation between gold prices and stock markets price indices. But this negative correlation dose not persist over the long-run. If you decomposed both time series (gold prices and Stock market indices) with the help of wavelets techniques at different investment horizons you can see that the this relationship is changing at various investment horizons. Overall, gold has weak correlation with stock markets prices indices. 
While, the crude oil has weak positive correlation with stock markets prices indices. on the other hand gold has strong positive correlation with dollar depreciation if dollars loosing its value it would have a positive effect on gold prices. which makes gold investment as an perfect hedge against dollar movement. 
See, Baur and Lucey, 2010; Baur and Mcdormmt, 2010, Juan C Robredo, 2014. 
Best Regards, 
Naveed Raza
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I am going to estimate the export supply function. Please can someone explain me why we include the cost variable (wages or other input cost) as supply side determinant in export supply function. What is economic rational by including this variable and how theoretically we related these two variables. Please explain with possible references. I am very thankful
Thanks and best regards
Sayed Irshad Hussain
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Input costs, typically proxied by the manufacturing wage are important for export supply functions. Have a look at Abbott & De Vita (2002) in Applied Economics, 34, 1025-1032. This paper unpacks the theory behind your question based on Riedel (1988)  modelling approach (see Economic Journal, 98, 138-48). I hope you find this useful.
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I have conducted survey and fieldwork about awareness of and demand for Islamic loans in Norway and I am looking to expand the research. I am particularly interested in work in sociology or anthropology or religious studies. 
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Abdul, thank you. I do not really use LInkedin, and I was hoping to find groups here in RG.
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I am searching for some models related to Small‐Firm Performance. But I have not found a model and references. Can you help me?
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Dear Tu
This link:: http://ssrn.com/abstract=1496201 and this book http://urn.kb.se/resolve?urn=urn:nbn:se:hj:diva-207 will help you to begin your studies. This you want is about entrepreneuship so you can read several studies on this site.
Kind regards,
Sílvio.
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There is a big range of countries which benefit from globalization much more than the others, let's say Serbia, Albania or Moldova in Europe, many countries in other parts of the world. Why  is it so striking and happening in the present world?
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i am no expert in this fleld. But i am afraid, if you think of globalization in Terms of economics and financial profit, there are two main reasons.
One is inside the subject: regarding what Mohammad said under 1. The Connections and communication abilities of a region or Country are important. As well it must be taken into account what it can offer to others ("only" the green lung of the earth like the Jungles, or oil. rare earths, Diamonds...)
For Muhammads 2. i would still shift the Focus: Outside of the subject is lying what other countries and powerfull persons, companies, banks and institutions are planning for the short and for the long run as what is helping them to remain in Power and even grow it. Unfortunately altruistic thinking seems to be very Little involved unless we talk of real and Independent NGOs and researchers. So i am also afraid that all the big plans of China for Africa, especially for Southafrica´s future, are far from altruistic.
Of course there are also many other parts of globalization, like how the different cultures treat women and where the new global tendency of acceptance of violence against women is going: Let´s all beat them now or better not and give selfdetermination and education to everyone, "even" women.
Another part is the health: globalization in medicine, what does it mean? Is it for the People´s health or the drug companies´s health, or do we find a fair and more reasonable way than before for both?
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In this paper I have shown that the notion of comparative advantage that can be found in todays economic textbooks is the result of important misinterpretations of Ricardo’s famous numerical example, like the definition of the four numbers and the relationship with the labor theory of value, among others. These misinterpretations led to a different notion of comparative advantage than Ricardo’s.
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Dear Jorge,
Forgive me for asking you what might seem to be an unnecessary, or even ill-informed, question but I am as much concerned by the manner in which the theories and ideas within the 'body of knowledge' that make up our 'discipline' relate to and thereby identify themselves as oriented towards a common goal, or a set of disparate goals, as by their details.  Also by the existence of any disparity between their apparent, or stated purpose, and their evident, or correlated purposes.  My question arises from your statement "The classical rule of specialisation – which is the rule Ricardo and other classical political economists applied in order to find out whether a particular trade is beneficial for a country or not..".
I would like to ask, initially perhaps:
"Does all of the classical economic writing, upon which the modern mainstream of economic teaching and of national policy development advice is ultimately based, have as its proximate, or its immediate, goal the benefit of the country or state?"
It occurs to me that if the 'production value' of the labour of individuals, to them, is to be maximised by their mutual specialisation of their individual labours in the context of their being a free and fair mechanism for the mutually agreeable exchange of the greater volumes of goods, and hence of greater value at fixed prices, that is being produced by their specialisation, and then one quickly moves on, as both Ricardo and Smith do, to  a consideration of the same basic processes across wider geographic areas which then subsume national boundaries and then to re-state the previously identified benefits to skilled or able individuals of the specialised application of their labours to being legitimately identified with "the benefit of the country or state" is to build into all subsequent economic argument the implicitly assumed and non-violate and rigid relationship to exist between 'the state' and the individuals through whom it is manifest and the individuals whose labour produced the products by and through which the benefit of 'the state' is being sought through this body of theory.
This seemingly natural identification of the goal of the benefit to 'the state' --- which is to be gained through the application of economic understanding and policies that are based upon that knowledge of the benefits which individuals labouring to produce goods in greater volume by their mutually 'agreed' specialisation avail themselves through their subsequent free and fair agreeable exchange  ---  dramatically exposes the nature of the social order existing in Mercantile times.  One in which the right of 'dominion' over lands had already been extended for hundreds of years to imply an absolute right of holder's of that dominion to be extended over the lives, labours and possessions of the main body of people residing within those dominions whenever and however it pleased them.
This assumption, it seems to me is still embedded today in our 'political economy', that is to say the 'study and development of state policy towards the economic activities of the people within the state'.  Further it suggests that very socio-political structure must tend to generate its own legitimate 'theory of political economy' as a body of views and policy generation processes in service of each state.
The consequence of this is that 'political economy' is greatly over reaching itself when it considers what is good for the world through the study and prescription of trade policy internationally, or any other area of policy for that matter, according to any specific, and probably dominant, socio-political order.   It is thus by this mechanism that a global hegemony in economic outlook is and has been established by the most dominant states and by which it is perpetuated.
This is neither 'scientific', legitimate or moral.....
....and the alternative of accepting the legitimacy of 'state specific' political economy cannot be legitimate either unless that study and body of policy is itself under-pinned by a basic, commonly and freely agreed body of knowledge and understanding regarding the individual rights and inviolate principles to be applied to the individuals comprising humanity itself.
Without this, everything we and our colleagues are engaged in serves humanity in no imaginable way for their long-term benefit, or short-term since that is always subsumed by the focus of political economy being on the benefits to be gained by the individuals most closely representing and embodying 'the state'.
Can you help me to understand what the actual purpose of all our evident philosophical and practical skills?  Is it to help all people?  or do we trust the interests of 'our paymasters' to be identical with those of all people?
And if they are "How do we know that as a fact and be sure that it will remain to be so?"
There is still a very long way to go before what we concern ourselves with now can be developed into something which has a context and demonstrable purpose within which we can then think about making the use of our skill in any way efficient and effective as a permanent means of benefiting mankind.
Kind regards,
Robin
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I’m trying to think this question through with the help of concepts like ‚differential inclusion’ and ‚obscene exclusion’ as Nicola De Genova suggests in "Spectacles of migrant ‘illegality’: the scene of exclusion, the obscene of inclusion" (2003). Maybe some of you have an other ideas on how I could find an answer to this question?
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Dear Isabel Villiger,
I hope the following references may be of assistance – they are a variety of empirical studies drawing on different strands of political economic theory.
Kind regards
Paul Chaney
Sohn, Christophe (2014) The Border as a Resource in the Global Urban Space: A Contribution to the Cross‐Border Metropolis Hypothesis, International Journal of Urban and Regional Research, Vol.38(5), pp.1697-1711
Pagliari, Stefano ; Vallée, Shahin (2014) Europe between financial repression and regulatory capture, IDEAS Working Paper Series from RePEc, 2014
Perkmann, M (2007) Policy entrepreneurship and multilevel governance: a comparative study of European cross-border regions, Environment And Planning C-Government And Policy, Vol.25(6), pp.861-879
Perkmann, M (2003) Cross-border regions in Europe - Significance and drivers of regional cross-border co-operation, European Urban And Regional Studies, Vol.10(2), pp.153-171
Nelles, Jen ; Durand, Frédéric (2014) Political rescaling and metropolitan governance in cross-border regions: comparing the cross-border metropolitan areas of Lille and Luxembourg, European Urban and Regional Studies, Vol.21(1), pp.104-122
Chilla, T ; Evrard, E ; Schulz, C (2012) On the Territoriality of Cross-Border Cooperation: "Institutional Mapping" in a Multi-Level Context, European Planning Studies, 2012, Vol.20(6), pp.961-980
Anderson, James ; O'Dowd, Liam (1999) Borders, Border Regions and Territoriality: Contradictory Meanings, Changing Significance, Regional Studies, 1999, Vol.33(7), p.593-604
Turkina, Ekaterina ; Postnikov, Evgeny (2014) From Business to Politics: Cross-Border Inter-Firm Networks and Policy Spillovers in the EU's Eastern Neighbourhood, Journal of Common Market Studies, Vol.52(5), pp.1120-1141
Kolosov, V. ; Zotova, M. ; Sebentsov, A. (2014) Structural features of the economy and gradients of socioeconomic development of the border regions of Belarus, Russia, and Ukraine, Regional Research of Russia, 2014, Vol.4(4), pp.286-300.
Dascher, Kristof ; Haupt, Alexander (2011) The political economy of regional integration projects at borders where poor and rich meet: The role of cross-border shopping and community sorting, Journal of Urban Economics, Vol.69(1), pp.148-164
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There are now number of papers with a title which includes "processing trade." One can say that processing trade is now a flourishing subject matter in the research of international trade. The concept is now well established but it is enigmatic that this concept remained obscure in the 20th century.
 Papers and books with titles which include "processing trade" before 2000 are rather rare. For example, we can cite these titles:
  • Kang, C. K., & Chang, S. I. (1987). Processing trade and industrial organization. KIET, Seoul.
  •  Kalyuzhnova, Y. (1995). Outward processing trade between the European Union and the associated countries of Eastern Europe: the case of textiles and clothing. Economic Bulletin for Europe, 47, 109-127.
  •  Dapei, Z. (1997). China's Present Processing Trade and Processing Trade Policies [J]. Productivity Research, 2.
  • Eichengreen, B., & Kohl, R. (1997). The State and the External Sector in Eastern Europe: Implications for Foreign Investment and Outward Processing Trade. In Conference held by the Berkeley Roundtable on the International Economy and the Kreisky Forum for International Dialogue:" Will There Be a Unified European Economy (pp. 5-6).
 At around 2000, the titles with "processing trade" increased suddenly. For example, I can cite many papers in the year of 2000 alone.
  •  Görg, H. (2000). Fragmentation and trade: US inward processing trade in the EU. Weltwirtschaftliches Archiv, 136(3), 403-422.
  •  Fabbris, T., & Malanchini, F. (2000). Patterns of vertical specialization and European Outward Processing Trade (OPT): a comparative analysis between Mediterranean countries and CEECs. Is there real Competition.
  •  Baldone, S., Sdogati, F., & Tajoli, L. (2000). Patterns and determinants of international fragmentation of production: Evidence from outward processing trade between the EU and the countries of Central-Eastern Europe (No. 134). Queen Elizabeth House.
  •  Zhao, C. (2000). Developing overseas investments with overseas processing trade as the new starting point'. Almanac of China’s Foreign Economic Relations and Trade 2000, 45-46. 
Of course, processing trade has been discussed inside the text. For example, let me cite papers which appeared before 1990.
  •  Watanabe, T., & Komiya, R. (1958). Findings from Price Comparisons Principally Japan vs. the United States. Weltwirtschaftliches Archiv, 81-96.
  •  Murakami, M. (1968). Geographical analysis of the industrialization in Singapore. Geographical Review of Japan, 41(9), 541-570.
  •  Watanabe, S. (1972). International subcontracting, employment and skill promotion. Int'l Lab. Rev., 105, 425.
  •  Haitani, K. (1973). Japan's Trade Problem and the Yen. Asian Survey, 723-739.
  •  Yamazawa, I., & Hirata, A. (1978). Industrialization and External Relations: Comparative Analysis of Japan’s Historical Experience and Contemporary Developing Countries’ Performance. Hitotsubashi Journal of Economics, 18(2), 33-61.
  •  Nakajō, S. (1980). Japanese direct investment in Asian newly industrializaing countires and intra-firm division of labor. The Developing Economies, 18(4), 463-483.
  •  Oda, H. (1984). The Administration of Foreign Trade in the People's Republic of China. The Developing Economies, 22(2), 155-168.
  •  Grunwald, J., & Flamm, K. (1985). The global factory: Foreign assembly in international trade. Brookings Institution Press. 
My question is why the notion of "processing trade" did not become major subject matter before 2000. As you see from the list above, early papers on processing trade have been written mainly by Japanese. This can be explained by the fact that promotion of processing trade (加工貿易) has been national policy (or 国是=national principle) for Japan since many years. At the first phase of Meiji period, Japan depended heavily on the exports of Silk and Copper, but soon it started to export cotton textile which was a typical processing trade, as Japan imported cotton flower and processed and exported it. 
The story was the same for Great Britain in the time of the Industrial Revolution. It imported cotton from India, United States and others and exported cotton textile. Lionel McKenzie emphasized that "Lancashire would be unlikely to produce cotton cloth if the cotton had to be grown in England" (McKenzie 1954, p.179). Processing trade promotion is also a vital question for newly developing countries now. 
Processing trade was one of the most important forms of international trade from the beginning of modern industrial economy. It remains to be so even today. It is enigmatic why this important category of international trade remained in the background until the arrival of fragmentation and global value chain. 
Perhaps the easiest answer is to point the lack of trade theory which can treat intermediate or input goods. Despite the fact that McKenzie and Jones pointed the necessity to build a theory of intermediate or input goods, no such general theory was provided during the 20th century. In view of its importance, one may ask again why the theory of input trade was not developed much earlier. 
Do you have any good explanation? 
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Robin Edward Jarvis raises at once so points of discussion that are all important, I cannot follow him promptly. I want to answer to his second post (post number 7). In his third post (post number 10), he makes a point that economics cannot and should not go without ethics. He is fundamentally right, but I am not prepared to discuss this question yet and do not enter to this question in this question page. Mohammad Israr Khan posed a question: How do the economists define self-interest and rationality?
In order to answer to his question in depth, I believe we cannot go without asking the elation between economics and ethics. I only started to learn one or two basic books to consider on this question. I will try to challenge answering in the near future (I hope). 
Another fascinating wonderful question, totally new to me, was raised by Carlos Eduardo Maldonado (post number 1) and Robin Edward Jarvis (post number 3, at the end of his post) mentioned on it:
  • There exist large areas of economics which have not yet been studied or recognized although they still do happen  
I will come back to this question after I will have discussed Robins’ two points. 
Robin Edward Jarvis (post number 7) raises many points here also, but I want to discuss following two points in the coming two posts :
  • (1) Technology in economics.
  • (2) Fractal-like structure of the world production network.
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I'm looking into international tax structures and would greatly appreciate any insights on royalty financing or the use of intercompany royalty payments as quasi-equity.
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Many thanks Ufuk - much appreciated!
Best regards
Ann
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If I want to export a product, what should I take into account? GDP or GDP per CAPITA?
My destinations are:
-U.S
-China
-France
-Finland
-Turkey
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A lot depends on the nature of the product: if you dream of selling something relatively cheap to millions of customers, then you need a large market (in terms of population, too, not only in terms of GDP), if you wish to target rich customers, you can check GDP per capita, but you also have to find out how many rich customers live in that country (e.g. in China, GDP per capita is lower than in Finland, but the number of millionaires should be higher). Also, you should check how "full" that market is in terms of competitors' products, which products local customers prefer etc....
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I need to inquire about the following :
1- case study in trade gravity model with panel data using stata or eviews or minitab
2- econometric problems with gravity model and solving
3- interpretation the results
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The following website can be helpful:
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My case study is the U.S and I'll be assessing how conflict scenarios can have an impact on economic indicators and the extent to which economic performance is affected (whether adversely or positively). I was just wondering whether running a regression model using Military expenditure as the independent variable and GDP growth as the dependent variable would lead to viable results. 
It's either that or I may opt for a panel data analysis. I just wanted some opinions on the methodology that I've opted to use here and it's viability. 
Notes: I'm using the U.S as my primary source of investigation and I'd be looking mostly at the Iraq war as my primary source of conflict. If I were to opt for a panel data analysis, I'd look at the entire world and relate it back to varying conflicts in those geographical locations.  Attached is a general consensus of my research work (which isn't necessary to read ).
Thanks in advance for all your opinions.
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Methodologically, I believe that the connection between military expenses and GDP growth is very weak if you are looking at the effects of armed conflicts and economic performance. First, as some already pointed out, using military expenses as proxy for armed conflicts is not a good selection. Besides, the U.S. do not face an armed conflict as many other countries actually do. These conflicts are beyojnd their borders. So, it would be very interesting to develop a theoretical model that shows this connection and see if theoretically this effect is significant. And second, you need to define what armed conflicts are. For instance, there are several countries in Latin America and Africa with extreme violence and many thousands of people killed per year; so are these events counted as armed conflicts? Besides, some countries do not spend much money on arms. So, it would be very important to have first a precise definition of armed conflict and try to model it theoretically to have a look at your hypotheses.
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Political science, International relations
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Dear Sharifah,
It is understandable that some people have misgivings about the utilization of the concept of "world government" to describe the current state of world politics. Perhaps "governance" would be a more adequate term to denote the sometimes loose and overlapping network of international institutions which have impact on global affairs. It is a system very different from the concept of "government" used in the national context.
Naturally we can use "world government" not only as a descriptive but also as a prescriptive concept -- as a political proposal for the future. To explain what I mean please think of the Stanford definition (http://plato.stanford.edu/entries/world-government/): "‘World government’ refers to the idea of all humankind united under one common political authority." It goes on to state that "it has not existed so far in human history, yet proposals for a unified global political authority have existed since ancient times..."
Then the link with the idea of capitalism: It is usually claimed that some sort of world government ideas existed before the advent of capitalism (ancient Chinese, ancient Romans etc.) However capitalism is the first truly global economic system, and it is logical that those who think it needs to be regulated at that same global level see merits in a world government.  It is also logical that those liberals who fear the dangers of extending the problems of bureaucracy from national to global level reject it.
That leads us to an important underlying question: Global government (or governance) for what? What do we want to regulate, how and in whose interest? Your question about capitalism in the title may indicate the dominance of economic regulation but that would risk a neglect of political, social, cultural and security issues. It is also a recurrent question how to protect the poor and the weak under such a world government. If somebody creates it emulating the national systems (e.g. majority vote), there is an increased danger of marginalization for small and weak groups.
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Does anyone know how to compute a test of over-identifying in a system of simultaneous equations? Sargan and Hansen tests are just used for a single equation but I need the test for the whole system of many simultaneous equations. I think there is a Hansen-Sargan test for this but I did not find any explicit reference exposing the formula.
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All the above answers are correct
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This question is a derivative from my other question:
Why did Eaton and Kortum model perform so badly?
The topic International Trade counts (as of September 16, 2015) 99 questions and 6,003 followers. My above question attracted only 50 views and two followers including me (ditto). This state may indicate the general atmosphere of researchers who work on international trade. They are not much interested in the theory.
This indifference in theory problems must really be a serious problem in international trade economics. How do you think about it?
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Does anything fit in economic models ?
If it were so, "crisis" would not sprout the way they do.
We (economists) learnt how to describe well but fail on how understand the reality
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The recent financial crisis has again raised the question to what extent price-stability-oriented monetary policy frameworks (bank central) should take into account financial stability objectives.
How could one use game theory in the interaction among goals of central banks, particularly in the trade-off between financial stability and monetary stability?
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Tetik is right, of course, but some of the other issues still arise. And Bias is right, too, in arguing that a mixed-strategy equilibrium is inappropriate to the case. But game theory is more than mixed-strategy equilibrium. In particular, when the game is noncooperative but allows some communication, a correlated strategy solution may occur. As Aumann notes, one way to achieve this is for a neutral third party to provide appropriately coordinated signals to the players. If, then, we model the private sector decisions as a large-scale coordination game, and treat the central bank as the neutral third party -- more or less neutral! -- there might be some interesting insights on information-release and secrecy as well as rules vs. discretion. 
Resources: 
Rosenstein-Rodan, Paul (1943), “Problems of Industrialization of Eastern and South-Eastern Europe,” Economic Journal  v. 53,  (June-Sept) pp. 202-211.
Although not game-theoretic, this sets the stage for treating the private-sector decisions as a coordination game. 
Aumann, Robert J. (1974), “Subjectivity and Correlation in Randomized Strategies,” Journal of Mathematical Economics  v. 1,  pp. 67-96.
McCain, Roger A. (2014),  Game Theory: A Nontechnical Introduction to the Analysis of Strategy, Third Edition (Singapore: World Scientific Publishers), pp. 251-254
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Are there any studies about the application of physics on international economics except the Gravity model?
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Econophysics is f.i. a standard topic at the triennial Statphys conferences, see the linked page. Personally I am reluctant to consider this a part of physics, although it certainly uses many ideas, concepts and methods from (statistical) physics. 
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Papers in relation to Chinese monetary policy.
Evidence of undervaluation of Chinese exchange rate.
How Chinese monetary policy affect the international economic and financial stability?
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The reason why Chinese currency became under valued is that the capital account was not free. However we should not forget that China has invested lot of money in US securities. If currency is revalued higher, this investment value will go down for China 
From, Purchasing Power Parity theory Chinese currency is not much under valued now. Onehas to compare just the Five Star Hotels charges in Bejing, and New York. China's intervention in foreign exchange markets and buying foreign currency also made the currency under valued. But that intervention was mostly sterilization and did not result in inflation there. But now wages started going up in China, and the economy is slowing down
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I am researching transit corridors of Tajikistan for the regional development with special refers to trade and confused about which theory and model (in methodology) can be used. 
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Hi everyone,
I am recently performing my analysis however, I get an error which I can not explain. I have searched on the internet but can not seem to find the right answer. 
I ran the following command and got the error; initial values not feasible (r1400). 
xtpoisson Patents Zemplshyoung Zemplshold, re normal
Fitting comparison Poisson model:
teration 0: log pseudolikelihood = -5572903.9
Iteration 1: log pseudolikelihood = -5496510.4
Iteration 2: log pseudolikelihood = -5496430.4
Iteration 3: log pseudolikelihood = -5496430.4
Fitting full model:
tau = 0.0 log pseudolikelihood = -5496430.4
tau = 0.1 log pseudolikelihood = -5461458.2
tau = 0.2 log pseudolikelihood = -5461856.8
initial values not feasible
r(1400);
When I run a xtpoisson with fixed effects +robust standard errors I do not have this problem. Also when I run xtpoisson with random effects, without robust standard errors this problem does not occur. However, I need xtpoisson, random effects + robust standard errors.  How can I run this analysis properly? 
Best,
Amber
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Hi Amber,
This is a strange occurrence, and you did a good job of trying out various work-arounds. I would suggest that you try meglm which will allow you to choose the Poisson family and logit link and allow you nest your data accordingly (together with robust standard errors). 
I am not sure if this will circumvent your problem, but it may.
I hope this helps