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Begin New Search Political Geography Asia Content Type Working Paper Publication Year within 25 Years

31. Place-based policies and agglomeration economies: Firm-level evidence from Special Economic Zones in India

Author:
Holger Görg and Alina Mulyukova
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper exploits time and geographic variation in the adoption of Special Economic Zones in India to assess the direct and spillover effects of the program. We combine geocoded firm-level data and geocoded SEZs using a concentric ring approach, thus creating a novel dataset of firms with their assigned SEZ status. To overcome the selection bias we employ inverse probability weighting with time-varying covariates in a difference-in-differences framework. Our analysis yields that conditional on controlling for initial selection, SEZs induced no further productivity gains for within SEZ firms, on average. This effect is predominantly driven by relatively less productive firms, whereas more productive firms experienced significant productivity gains. However, SEZs created negative externalities for firms in the vicinity which attenuate with distance. Neighbouring domestic firms, large firms, manufacturing firms and non-importer firms are the main losers of the program. Evidence points at the diversion of inputs from non-SEZ to SEZ-firms as a potential mechanism.
Topic:
Economics, Business, Special Economic Zones, and Geography
Political Geography:
India and Asia

32. Cutting through the Value Chain: The Long-Run Effects of Decoupling the East from the West

Author:
Gabriel Felbermayr, Alexander Sandkamp, and Hendrik Mahlkow
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
With ever-increasing political tensions between China and Russia on one side and the EU and the US on the other, it only seems a matter of time until protectionist policies cause a decoupling of global value chains. This paper uses a computable general equilibrium trade model calibrated with the latest version of the GTAP database to simulate the effect of doubling non-tariff barriers - both unilateral and reciprocal - between the two blocks on trade and welfare. Imposing trade barriers almost completely eliminates bilateral imports. In addition, changes in price levels lead to higher imports and lower exports of the imposing country group from and to the rest of the world. The targeted country group increases exports to the rest of the world and reduces imports. Welfare falls in all countries involved, suggesting that governments should strive to cooperate rather than turning away from each other. By imposing a trade war on Russia, the political West could inflict severe damage on the Russian economy because of the latter’s smaller relative size.
Topic:
International Cooperation, International Trade and Finance, European Union, Conflict, Trade Wars, Protectionism, and Rivalry
Political Geography:
Russia, China, Europe, Asia, North America, and United States of America

33. Can Aid Buy Foreign Public Support? Evidence from Chinese Development Finance

Author:
Lukas Wellner, Brad Parks, Axel Dreher, Andreas Fuchs, and Austin M. Strange
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Bilateral donors use foreign aid to pursue soft power. We test the effectiveness of aid in reaching this goal by leveraging a new dataset on the precise commitment, implementation, and completion dates of Chinese development projects. We use data from the Gallup World Poll for 126 countries over the 2006–2017 period and identify causal effects with (i) an event-study model that includes high-dimensional fixed effects, and (ii) instrumental-variables regressions that rely on exogenous variation in the supply of Chinese government financing over time. Our results are nuanced and depend on whether we focus on subnational jurisdictions, countries, or groupings of countries.
Topic:
Development, Bilateral Relations, Foreign Aid, and Influence
Political Geography:
China and Asia

34. Who Lends to Africa and How? Introducing the Africa Debt Database

Author:
David Mihalyi and Christoph Trebesch
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Africa’s sovereign debt markets are not well understood, partly due to a lack of data. This paper introduces the Africa Debt Database (ADD), the most granular and comprehensive dataset on external borrowing by African governments thus far. Our project moves beyond existing aggregate datasets and instead releases information on individual loans and bonds, in particular on the financial terms of each instrument. Taken together, we cover nearly 7000 loans and bonds between 2000 and 2020, with a total volume of 644 billion USD. Using this data, we study Africa’s record lending boom of the 2010s in detail. The debt boom was mainly driven by large sovereign bond issuances in London and New York, as well as growing lending by Chinese state-owned banks. The micro data also reveal a large variation in lending terms across countries, time, and creditors. Sovereign external bonds have interest rates of 6 percent, on average, Chinese banks charge 2-4 percent, and multilateral organizations just 1 percent. Strikingly, many governments in Africa simultaneously borrow large amounts from both private and official creditors, at vastly different rates. The large differences in debt servicing costs are indicative of a cross-creditor subsidy, as cheap concessional loans can be used to pay the high interest to private or Chinese creditors.
Topic:
Economics, Foreign Aid, Credit, and Influence
Political Geography:
Africa, China, and Asia

35. Who wins and who loses from state subsidies?

Author:
Sourafel Girma, Holger Görg, and Ignat Stepanok
Publication Date:
05-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
China is perceived to rely on subsidizing firms in targeted industries to improve their performance and stay competitive. We implement an approach that allows for the joint estimation of direct and indirect effects of subsidies on subsidized and non-subsidized firms. We find that firms that receive subsidies experience a boost for productivity. However, our approach highlights the importance of indirect effects, which are generally neglected in the literature. We find that, in general but not always, non-subsidized firms experience reductions in their productivity growth if they operate in a cluster where other firms are subsidized. These negative externalities depend on the share of firms that receive subsidies in the cluster. Aggregating direct and indirect effects into a (weighted) total effect shows that this negative indirect effect tends to dominate. We interpret our results in the light of a simple heterogenous firm type model, which highlights that subsidization, in a competitive environment of firms, may potentially harm non-subsidized firms.
Topic:
Governance, Business, Subsidies, and Competition
Political Geography:
China and Asia

36. A Primer on the 2022 National Security Strategy

Author:
Peter Juul and Heba Malik
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Center for American Progress - CAP
Abstract:
The 2022 National Security Strategy introduces new ideas on navigating strategic competition with China and Russia, investing at home, and a renewed focus on the fight against climate change.
Topic:
Security, Climate Change, National Security, Rivalry, and Strategic Interests
Political Geography:
Russia, China, Europe, Asia, North America, and United States of America

37. Japan and the War in Ukraine

Author:
Eyal Ben-Ari
Publication Date:
05-2022
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Two weeks after the war began, Japan announced that its new National Security Strategy scheduled to be published this year would recategorize Russia from “partner” to “security challenge,” thus placing it alongside China and North Korea.
Topic:
Security, Defense Policy, Military Strategy, and Conflict
Political Geography:
Russia, Japan, China, Europe, and Asia

38. Biden, Israel, and China: Making a Difficult Threesome Work

Author:
Steven R. David
Publication Date:
05-2022
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
It is wrong to expect Israel, a middle-level economy, to decouple from China when far wealthier countries (including the United States) show no signs of following suit. Israeli companies should not be subject to restrictions not placed on companies elsewhere, including the United States itself.
Topic:
Diplomacy, International Trade and Finance, Hegemony, and Conflict
Political Geography:
China, Middle East, Israel, Asia, North America, and United States of America

39. A US failure in Ukraine Crisis could lead to a conflagration in Middle East, Asia

Author:
Efraim Inbar
Publication Date:
02-2022
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
China could learn that US determination is melting away, and its threats can be ignored. An attack on Taiwan could follow.
Topic:
Military Strategy, Hegemony, Conflict, and Strategic Interests
Political Geography:
China, Taiwan, Asia, North America, and United States of America

40. Could Biden construct a new world order through détente with Russia?

Author:
Efraim Inbar
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Such a scenario would give the US a leg up against China’s totalitarianism and expansionist aims, and bridge the age-old schism with Russia
Topic:
Diplomacy, Hegemony, Rivalry, and Strategic Interests
Political Geography:
Russia, China, Europe, Asia, North America, and United States of America