Transcript Экономическое развитие, глобализация, и

Economic diversification,
development and globalization
Natalya Volchkova
November 20-21, 2008
New Delhi, India
Motivation
• Very little is known about diversification
• Diversification of Russian economy is claimed to
be a prerequisite of sustainable long-term
growth
• What needs to be diversified: output or export?
– This is especially important for resource rich economy
• What diversification depends on? Which
policy can affect it?
Questions to address
• Stylized facts about diversification and
development
• How diversification depends on
– openness,
– resources,
– FDI,
– policies?
• Type of globalization matters: regionalism
vs. WTO?
How to measure diversification
•
•
•
•
•
Gini, HH, CR3, Min-Max spread…..?
What level of industry desegregation?
Manufacture vs. overall economy
Export vs. Output
In this study we use Gini and HH index for
3-digit ISIC – we study concentration
Concentration and development: literature
• Imbs and Wacziarg (AER 2003) “Stages of
diversification”: U-shape dependence of VA
manufacturing concentration on income level
Concentration and development
• There is no U-shape in concentration of
manufacturing output and export
Theory: concentration and
• Openness: economic efficiency increases
due to specialization (both of output and
export)
• Natural resources: ambiguous effect on
output concentration, positive effect on
export concentration
• FDI: fall in output concentration,
ambiguous effect on export concentration
Empirical analysis of concentration
• Cross-country analysis
• Data:
• Output concentration:
– Manufacture output, 3-digit ISIC rev.2 from CEPII database GINI
• Export concentration:
– Manufacture export, 3-digit ISIC rev.2 from CEPII database GINI
– Export, 4-digit SITC rev.2 from COMTRADE ООН – HerfindalHirshman
• Country data – from WDI
• FDI – from WDI and OECDIDI
Variables
• Concentration: Gini, Herfindal – Hirshman
• Development (and size of economy) –
GDP per capita, PPP
• Openness – share of trade (export) in
GDP
• Resources – share of primary export
(metals, fuel and raw agriculture) in total
export
Output concentration
Concentration
of output
    * GDP per capitai   * Opennesi   * Re sourcesi   * FDIi   i
i
-
+
-
?
Dependent variable: average concentration of manufacture output, 1990-1995
Log of GDP per capita, 1990
-.020***
(0.007)
Openness, 1990
.034*
(0.018)
Resources, 1990
-0.021
(0.028)
Share of accumulated FDI in GDP, 1990
-0.017**
(0.007)
Constant
R-squared
Observations
***, **, * - significant at 1, 5, 10%; standard error in parenthesis
0.266***
0.30
43
Export concentration
Concentration
of export
    * GDP per capitai   * Opennesi   * Re sourcesi   * FDIi   i
i
-
+
+
?
Dependent variable: average concentration of export, 1990-1995
Log of GDP per capita, 1990
-.033**
(0.016)
Openness, 1990
.079***
(0.030)
Resources, 1990
0.210*
(0.092)
Share of accumulated FDI in GDP, 1990
-0.041**
(0.021)
Constant
R-squared
Observations
***, **, * - significant at 1, 5, 10%; standard error in parenthesis
0.041***
0.29
68
Openness and concentration: type
of globalization matters
Dependent variable: average concentration of export, 2000-2005
Log of GDP per capita, 2000
-.042***
(0.011)
Openness, 2000
.120***
(0.046)
Resources, 2000
0.071*
(0.038)
Share of export that goes to PTA countries, 2000
-0.067**
(0.035)
Constant
0.533***
R-squared
0.28
Observations
114
***, **, * - significant at 1, 5, 10%; standard error in parenthesis
Summary of empirical results:
Diversification of output and export increases
along with
– development
– FDI increase
decreases along with
– openness
Resources
– do not affect manufacture output diversification
– are bad for export diversification
PTA participation has positive effect on
diversification of export
FDI and globalization?
• Analysis of bilateral FDI in gravity model framework
FDI
  ij   * ln_ GDPi ,t   ln_ GDPj ,t  X ij,t   ij,t
GDP ij,t
• Xij,t – dummy variables
– WTO membership (both countries in, only one country in)
– Member of common PTA
• Panel fixed effect (by pairs) estimations, 1975-2005
Multilateral vs. preferential openness
and FDI
Dependent variable: inflow of FDI from donor to recipient as a share of
recipient’s GDP
Log of donor’s GDP
0.000039***
(0. 00001)
Log of recipient's GDP
0.00006***
(0. 00001)
Both are WTO members
-0.00002
(0. 0003)
Only recipient is WTO member
-0.00001
(0. 0003)
Only donor is WTO member
0.00008
(0.0003)
Both countries are members of PTA
0.0001***
(0.00005)
Constant
-0.002***
R-squared
0.002
# of observations
125813
Diversification and Trade
Liberalization
• At least two effects of PTA on export
diversification – direct (foreign market
access) and through FDI
• Both effects increase diversification
• WTO membership could have negative
effect on export diversification
Policy Implication
• Regional integration matters for export and
output diversification
• For Russia bilateral trade liberalization and
participation in regional trade agreements could
help to overcome both output and export
concentration
• Further promotion of Russian trade agreements
with China and India should also be considered
in this respect – there are steps toward it but
there is still a long way to go to liberal trade
agreements.