Explore the vast range of titles available.

The novelty of this study is that it empirically tests four hypotheses of the Dutch Disease in the Azerbaijan economy while systematically controls for other possible explanations of the observed processes over the period 2000–2007. The study concludes that an “absolute de-industrialization” has not taken place in Azerbaijan, rather the country suffers from a “relative de-industrialization” in the non-oil tradable sector. Additionally, the paper shows that the non-tradable sector has substantially expanded during the 2000–2007 period. Analysis also presents that the government expenditures have created a “spending effect”, which is more crucial than the “resource movement effect”. Furthermore, it was found that rapid increases in the wages and the non-tradable prices have led to appreciation of the real exchange rate in Azerbaijan. Finally, the study reveals that foreign direct investments inflow to the oil sector is harmful for non-oil exports and therefore, it contributes to deepening of resource, or oil, dependence. Findings in this paper support the view that to obtain a diversified economy with a long-term balanced growth development of the non-oil tradable sector should be of the major focus for the policymakers.

This study examines the impact of remittances on Nigeria’s real exchange rate and the productivity of its tradable and non-tradable sectors. Drawing on the Dutch Disease Model and the Balassa–Samuelson Effect, the research investigates how remittance inflows influence economic dynamics in a developing, oil-dependent economy. Using annual data from 1980 to 2022 obtained from the World Development Indicators and the Central Bank of Nigeria, the study employs the Autoregressive Distributed Lag (ARDL) approach to analyse both short- and long-term effects. The results reveal a complex relationship that challenges traditional expectations. In the short term, remittances decrease productivity in the tradable sector while improving productivity in the non-tradable sector. However, over time, the tradable sector recovers and experiences sustained gains, whereas the non-tradable sector experiences declines in productivity. Contrary to the Dutch Disease hypothesis, remittances do not exert a long-term impact on the real exchange rate. Other factors, including trade openness, inflation, and terms of trade, also significantly influence the real exchange rate and tradable sector. The findings suggest that Nigeria should avoid over-reliance on remittances as a tool for exchange rate stabilisation. Instead, efforts should prioritise strengthening the capital market, curbing capital flight, and promoting export growth. By shedding new light on the intricate effects of remittances, this study provides valuable insights for policymakers in Nigeria and other developing economies.

This study investigates the impact of social and physical infrastructure spending on the non-oil tradable and non-tradable sectors while controlling for non-oil capital stock and employment in the Azerbaijani economy for the period 1995-2014. The analysis employs the Engle-Granger and Phillips-Ouliaris cointegration tests using FMOLS estimation results to test for the existence of long-run relationships. The tests results indicate the existence of long-run relationships among the variables. The estimation results reveal positive impacts of both social and physical infrastructure spending on non-oil tradable and non-tradable outputs. However, the impacts on the non-tradable sector are considerably larger than those on the non-oil tradable sector. Developing the non-resource tradable sector, and thereby reducing possibility of the “Resource Curse” and especially the Dutch Disease, is one of the strategic aims of natural resource-rich countries. In this regard, the findings of this research may be useful for Azerbaijani policymakers in taking measures that aim at fostering the development of the non-oil tradable sector, thereby avoiding possible negative outcomes of resource dependency such as the Dutch Disease.

The impact of the digital economy (DE) has become the important faction of the market volume of domestic non-tradable sectors (DNSs). As rising digitalization supersedes traditional market power as a driving force, there is increasing concern about the volume of trade and economy; however, the literature of how the DE procession changed the DNS’s are limited, although the Chinese government is eager to enlarge the scale of the domestic market to be consistent with the trend of digitalization. This paper addressed this issue by employing a series of data from prefecture-level cities between 2010 and 2019 in China. Using panel data methods under fixed effect, synthetic difference-in-differences (SDID), and temporal-spatial econometrics, the paper’s hypothesis sheds light on the positive impact of the DE on DNSs. The regression results showed a 14.84% of improvement for the effects of DE development on DNS growth. The policy impact effect increased the average treatment effect by 3.9% average treatment effect, accompanied by temporal and spatial correlations. Further analysis illustrated that a possible intermediary mechanism through which the DE promotes the development of DNSs is the enhancement of the local product market development. It was concluded that policy-makers of developing countries should be devoted to breaking down domestic trade barriers among different regions to enhance the benefits of digitalization.

This paper investigates the role played by total factor productivity (TFP) in the tradable and nontradable sectors of the United States, the euro area, and Japan in the emergence and evolution of today's global trade imbalances. Simulation results based on a dynamic general equilibrium model of the world economy, and using the EU KLEMS database, indicate that TFP developments in these economies can account for a significant fraction of the total deterioration in the U.S. trade balance since 1999, as well as account for some the surpluses in the euro area and Japan. Differences in TFP developments across sectors can also partially explain the evolution of the real effective value of the U.S. dollar during this period.

Understanding how and why economies structurally transform as they grow is crucial for making sound national policy decisions. Typically, analysts who study this issue focus on sectoral shares of gross domestic product and employment. This paper extends those studies to include exports, including exports of services. It also considers mining, in addition to agriculture and manufacturing, and recognizes that some of the products of these four sectors are nontradable. The section on theory presents a general equilibrium model that provides hypotheses about structural change in different types of economies as they grow. These are then tested econometrically with annual data for the period 1991–2014 for a sample of 117 countries. The results point to the futility of adopting protective policies aimed at slowing deagriculturalization and subsequent deindustrialization in terms of sectoral shares, since those trends inevitably will accompany economic growth. Fortuitously, governments now have more efficient and equitable ways of supporting adjustments needed by people who choose or are forced to leave declining industries.

We return to the traditional theme of the distributive consequences of international prices and trade policies, focusing on economies relatively abundant in natural resources with a large non-tradable-goods sector. Changes in international prices create an aggregate demand effect which impacts on the earnings of factors employed in the non-traded goods sector. We show that, in economies highly specialized in the production of tradable goods and where the import-competing sector is small, under standard assumptions, terms-of- trade shifts have a neutral effect on factor prices and thus lack distributive effects, quite differently from Stolper-Samuelson scenarios. In economies with sizable import-competing sectors and two “urban” productive factors (e.g. skilled and unskilled labor), changes in the terms of trade do induce distributional tensions through two channels: (i) the exogenous shift in the relative price of tradable goods, and (ii) the endogenous displacement of the demand for non-tradables. We illustrate how, according to the structure of the economy, different patterns of income distribution may arise. Next, we analyze the introduction of trade duties. Trade taxes change relative prices between tradable goods as a terms-of-trade shock does, but also introduce an additional demand mechanism, that depends on the use the government gives to the revenues. If the tax revenues are transferred back to the private sector, the resulting reallocation of spending favors those factors used intensively in the production of non-tradables.

Reduced trade barriers and lower costs of transportation and information have meant that a growing part of the economy has been exposed to international trade. In particular, this is the case in the service sector. We divide the service sector into a tradable and a non-tradable part using an approach to identify tradable industries utilizing a measure of regional concentration of production. We examine whether the probability of displacement is higher and income losses after displacement greater for workers in tradable services and manufacturing (tradable) than in non-tradable services. We also analyze whether the probability of re-employment is higher for workers displaced from tradable services and manufacturing than from non-tradable services. We find that in the 2000s the probability of displacement is relatively high in tradable services in comparison to non-tradable services and manufacturing. On the other hand, the probability of re-employment is higher for those displaced from tradable services. The largest income losses are found for those who had been displaced from manufacturing. Interestingly, the income losses of those displaced from manufacturing seems mainly to be due to longer spells of non-employment, whereas for those displaced in tradable services lower wages in their new jobs compared to their pre-displacement jobs appears to play a larger role.

We study the impact of shocks to different types of government spending on the sectoral composition of output for a panel of EMU member countries. We find that fiscal shocks lead to an increase in the relative size of the nontraded sector, with the impact varying across the different spending categories. There is typically no significant impact on the level of production in the tradables sector but the level of imports increases and the level of exports declines in most cases. Overall, the results show that fiscal shocks matter not only for aggregate variables but also for the sectoral composition of output. The sectoral output results are consistent with previous work concerning the impact of fiscal shocks on the real exchange rate and the relative price of nontradables.

This paper investigates the effects of fiscal policy shocks on net export performance and the sectoral composition of output in Greece in the post 2000 period. A reduction in government spending (or tax hike) exerts a negative response on output which reduces import demand. A cut back in government spending boosts exports through the labor cost competitiveness channel further improving net exports. Tax hikes in particular on social security contributions and other indirect taxes reduce export performance. Although real aggregate output declines following a cut in government spending, the tradable sector output responds positively, further improving net exports.