Journal of International Commerce, Economics and Policy

This paper reviews the International Monetary Fund (IMF) policy advice to emerging market economies (EMEs) during the 2008-09 crisis, contrasting it to previous crisis episodes. EMEs that had strong fundamentals, and were mainly affected through international trade and financial spillovers, were advised to loosen monetary and fiscal policies, much like the counter-cyclical policies pursued by advanced economies. But in EMEs with "home-grown" vulnerabilities, the advice was more traditional fiscal consolidation, monetary restraint and structural reform, albeit with more financing and greater emphasis on cushioning the impact of the shock. Thus, the "new" IMF advice was the result of "new fundamentals" in EMEs.

This study examines the determinants of host-location of cross-border acquisitions by Indian Business Group (BG)-affiliates and other firms during 2000–2008. Our empirical estimates indicate the general attraction of host country market-size and double-taxation-avoidance treaty. However, unlike the standalone firms, the acquisition-location of BG-affiliates is favourably influenced by the host growth rate and bilateral investment treaty, apparently drawn to distant nations, and not significantly affected by the cultural proximity. The host's share of home exports affects relatively more the acquisition-location of standalone firms. Thus the derived resources/ parental networks of BG-affiliated emerging market multinational enterprises influence their outward-FDI locational pattern.

This paper looks at the performance of the United States (US) on the Global Entrepreneurship and Development Index (GEDI), capturing the contextual features of entrepreneurship. The US ranks third on the GEDI. It performs well on the aspirations sub-index but lags on the attitudes and activity sub-indices. Its performance is strong in areas of startu skills, competition, and new technology but weak in cultural support, tech sector, and high-growth business. Performance is stronger on institutional variables than on individual variables. Apparent weakness in the tech sector, lack of cultural support for entrepreneurship and lack of high-growth business can be due to the changing political environment and international volatility, 1990s tech sector bubble burst, the recent recession, and the improving performance of other counties.

Ogawa and Shimizu (2005) proposed an Asian Monetary Unit (AMU), which is a common currency basket composed of ASEAN plus three Asian currencies, and AMU Deviation Indicators (AMU DIs), which indicates deviations of each Asian currency in terms of the AMU compared to the benchmark rate. In this paper, we use daily and monthly data of AMU and AMU DIs to examine their usefulness as a surveillance indicator for monetary cooperation in Asia. We find that an AMU peg system stabilizes the trade-weighted exchange rates within Asia and that AMU DIs warn of misalignments of and between Asia currencies.

This paper considers how exchange rates affect East Asian trade. The evidence indicates that exports produced within regional production networks depend on exchange rates throughout the region while labour-intensive exports depend on exchange rates in the exporting country. These results make sense since the majority of the value-added of processed exports come from imported parts and components while most of the value-added of labour-intensive exports comes from the domestic economy. Recent findings also indicate that imbalances between China and the US are a major outlier and that an appreciation of the Chinese yuan (CNY) is necessary to reduce these imbalances.

This paper focuses on the implications of the economic crisis and recession of 2008–2009 for climate change and related policy responses. Stressing that even prolonged output losses make very little difference to appropriate emissions reduction objectives, the paper argues that a cautious shift towards a more aggressive path of carbon pricing need not impede recovery and could make a valuable contribution to addressing looming fiscal challenges. Well-designed and monitored "green" stimulus measures can help sustain aggregate demand during the downturn, while increased climate-related public spending will likely be needed into the longer-term. However, it is critical to avoid undue reliance on spending rather than tax measures, particularly as the recovery strengthens.

The literature on the effects of aid and remittances as a share of GDP on growth of the GDP per capita has placed much emphasis on growth regressions thereby emphasising only the direct effects on growth. In order to get the total effect one has to capture the indirect ones too and integrate them with the direct effects. To do so we integrate all equations into a dynamic system and run a baseline simulation. We compare several scenarios — doubling aid, cutting remittances to half, and stopping net migration — to the baseline simulation for all variables.

This paper reviews the literature on tax assignment in decentralised countries. Ideally, own-source revenues should be sufficient to enable at least the richest subnational governments to finance from their own resources all locally-provided services that primarily benefit local residents. Subnational taxes should also not unduly distort the allocation of resources. Most importantly, to the extent, possible subnational governments should be accountable at the margin for financing the expenditures for which they are responsible. Overall, the 'best' package for any particular country or subnational government is likely to be not only context-specific and path-dependent, but also highly sensitive to the balance struck between different political and economic factors and interests.