Arne Melchior

A Global Race for Free Trade Agreements : From the Most to the Least Favored Nation Treatment?

The article examines the currently expanding worldwide network of bilateral free trade agreements. Following regional integration in Europe and later the Americas, the process in East Asia has accelerated from 2002. A distinctive feature of the current stage is the expansion of FTAs beyond geographical regions and into global space, hence challenging WTOs supremacy on inter-continental trade rules. Setbacks in the WTO Doha Round may stimulate a further move towards "global bilateralism". While integration between geographically distant countries will have a smaller impact than integration between neighbours, countries may nevertheless gain from "global bilateralism". The more such agreements in place, the greater is the incentive for new ones. Even if political obstacles hinder some agreements, the process is currently accelerating. While it is rational for countries to pursue such agreements, the process is currently accelerating. While it is rational for countries to pursue such agreements, they should in parallel work for multilateral trade liberalisation in order to reduce the discriminatory impact of FTAs. This is needed if we are to avoud that "Most Favored Nation" treatment under the WTO actually becomes "Least Favored Nation" treatment: Rules that only apply to countries that are left outside the "free trade race".

Industrial heterogeneity of the ICT industry : An exploratory survey on Norwegian firms

The paper presents evidence from a limited survey undertaken among Norwegian ICT firms in 2001, supplemented with other statistical evidence. Corresponding to the limited production of ICT hardware in Norway, the hardware firms covered by the survey were dominated by sales outlets of foreign firms. While these firms are on average small and with a modest skill requirement, some of them are larger and more skill-intensive due to the provision of related software and services. Within-firm learning, higher education as well as sector- and industry-wide knowledge externalities generally matter to IT firms. Education is ranked third, and is more important for software and services than for hardware. Knowledge externalities are less important for foreign-owned firms. 2/3 of the firms surveyed produce various combinations of hardware, software and services, with software+services as the most frequent combination, composed by firms that are on average clearly larger than the sample average. Such firms rely more on learning within the firms and less on sectorwide knowledge externalities than other IT firms. Adaptation of products to individual customers is important for many IT goods, and implies that e.g. imported software frequently generates substantial domestic employment in related services. The survey tentatively suggests that such complementarities in production may be an important aspect of IT production. Norwegian IT exports are generally small, but pure software producers in the sample had larger exports.

Rammevilkår for norsk fiskeeksport

I en spørreundersøkelse ble 81 norske sjømateksportører også bedt om å kommentere ulike rammevilkår for eksporten. Dette notat oppsummerer resultatene fra denne del av undersøkelsen, uten å gjennomføre en full evaluering av de enkelte tiltak. Resultatene viser at toll og handelshindringer oppfattes som viktigst av ulike rammevilkår. Markedsføring og informasjon om handelshindringer fra EFF (Eksportutvalget for fisk) er også viktig for bedriftene, mens EFFs informasjon om enkeltmarkeder er lavere verdsatt. Mens mange norske sjømateksportører – spesielt små bedrifter - anvender GIEKs eksportkredittgarantier, mener en del av dem at GIEKs tilbud i markeder med høy risiko er for begrenset. Notatet reiser spørsmål om hvorvidt eksportfremmende tiltak i større grad bør rettes inn mot nye markeder i startfasen.

EUs utvidelse og handelsvilkårene for norsk fiskeeksport

Notatet analyserer hvordan tollbelastningen for norsk sjømateksport til søkerlandene kan påvirkes av EUs utvidelse. Norge har frihandelsavtaler med 11 av de 13 søkerlandene, og som følge av dette er tollen for fiskeeksport til disse landene null i de fleste tilfeller. Dersom EUs toll innføres for disse landene, øker tollen til 8.5% i gjennomsnitt fordi eksporten særlig består av varer med høy EU-toll (pelagisk fisk). I tillegg blir Norges konkurranseposisjon svekket fordi EU-landene får null toll istedenfor en tollbelastning på 5-8% i dag. Dersom Norge ikke får kompensasjon for økt toll, kan det føre til en betydelig reduksjon i eksporten. Ved tidligere EUutvidelser har imidlertid Norge fått kompensasjon, stort sett i form av tollfrie kvoter. Notatet argumenterer for at dette er sannsynlig også denne gang, selv om det juridisk sett ikke er helt selvsagt. Muligens vil en generell tollreduksjon være bedre enn tollfrie kvoter, fordi kvoter skaper byråkrati og ikke kan tilpasses endringer i handelsmønsteret.

Sunk costs in the exporting activity: Implications for international trade and specialisation

International trade costs may be sunk and not proportional to sales. The paper explores this theoretically, by allowing firms to invest in sales channels or marketing in order to increase demand in each market. The returns to such investments will, ceteris paribus, be higher in markets with lower variable trade costs (e.g. transport costs). Firms will therefore invest and sell more at home than in foreign markets, and more in foreign markets with low variable trade costs. Sunk export costs will therefore amplify the trade-reducing impact of other trade barriers, and dampen the «home market effect» whereby large countries tend to be net exporters of differentiated goods.

Learning, Networks and Sunk Costs in International trade: Evidence form Norwegian Seafood Exports

Based on new survey data for 81 Norwegian seafood exporters, the report examines the composition and magnitude of different types of trade costs, ranging from tariffs and transport costs to other sales costs. The results suggest that there are economies of scale in the exporting activity, due to fixed costs of market entry, learning through experience, and externalities between firms so that one exporter benefits from the others via learning or joint marketing effects. Seafood exports strongly rely on personal networks, and firms incur costs in order to establish these networks. On the whole, however, fixed sales costs for seafood exports are small, due to these products being relatively homogeneous. In spite of this, such costs matter for the choice of markets and the magnitude of trade. The report analyses how costs vary across products, firms and markets. For seafood exports, traditional trade barriers such as tariffs and transport costs are more important than the sunk costs. Transport costs do not increase proportionally with geographical distance, mainly since this is not the case for sea transports.

Globalisation and industrial location: The impact of trade policy when geography matters

The paper shows how industrial location and welfare depends on “most-favoured nation” (MFN) versus distance-related trade barriers, using a monopolistic competition model with regions located along a “Hotelling” line or on a square plain. Manufacturing production will cluster close to the periphery if transport costs are relatively high, but in central areas if MFN barriers are relatively high. The peripheries will be at a disadvantage, which increases when trade barriers are reduced. When countries or trading blocs are formed, a core-periphery pattern emerges within each of them. While lower transport costs create more centralisation within countries, lower MFN barriers between countries have the opposite effect.

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