Economics Theses and Dissertations
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Browsing Economics Theses and Dissertations by Author "Blonigen, Bruce A."
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Item Open Access Essays on Cross-Border Mergers and Acquisitions, Technology, and Frictional Costs(University of Oregon, 2012) Lee, Donghyun; Lee, Donghyun; Blonigen, Bruce A.Foreign direct investment (FDI) has played a major role in the increasing economic globalization of the past couple decades. Cross-border mergers and acquisitions (M & A) is the major source of FDI, particularly for developed countries accounting for as much as two-thirds of FDI. Yet, studies on such cross-border M & A activities are scant in the literature. This dissertation aims at explaining the relationship between cross-border M & A, technology, and frictional costs using both theoretical and empirical analyses. In chapter II, I conduct empirical analysis to determine the relationship between exchange rates and acquisition FDI. I find that depreciation of the host country's currency leads to an increase in acquisition FDI into high-R & D sectors for U.S. inbound acquisition FDI from multiple country sources, but not for inbound acquisition FDI for other various developed countries. In chapter III, I develop an equilibrium model of cross-border M & A and show that the model predicts that firms from a larger country are more likely to acquire in a smaller country when M & A activity is driven by a technology-seeking motive, but the opposite is true when it is driven by a market-seeking motive. I also find empirical evidence that cross-border M & A activity exhibits behavior consistent with this prediction. In chapter IV, I empirically examine the relevance of heterogeneous sector-specific frictional costs using detailed data on worldwide M & A activity. Results show that cultural distance, tradeability, and regulation play an important role in determining heterogeneous frictional costs across different sectors. This dissertation includes unpublished co-authored material.Item Open Access Essays on Trade and Transportation(University of Oregon, 2017-09-06) Friedt, Felix; Blonigen, Bruce A.This dissertation considers the interconnections between trade and transportation. Through various theoretical and empirical analyses, I provide novel evidence of the simultaneity of trade and transportation, of spillover effects across integrated transport markets, and of the influence of the international transport sector on trade policy effectiveness and natural disaster induced trade disruptions. In the first substantive chapter, I develop a model of international trade and transportation. Accounting for the joint-production present in the international container shipping industry, I illustrate that freight rates adjust to differences in the international demands for transport and can result in balanced or imbalanced equilibrium trade in the presence of asymmetric freight rates. The empirical results exhibit the simultaneity of international trade and transportation costs and show that the dependence of transport costs on the trade imbalance can lead to spillover effects across bilateral export and import markets. In the second substantive chapter, I investigate the effects of maritime trade policy on bilateral trade in the presence of trade imbalances. Using the previously developed model, I show that the trade elasticities with respect to carrier costs vary systematically across transport markets, bilateral trade imbalances and differentiated products. Empirically, I estimate the varying effects of an EU environmental policy on U.S.-EU trade and provide strong evidence in support of the theoretical results. In the third substantive chapter, I analyze the dynamics and spatial distribution of the trade effects induced by natural disasters. I develop a spatial gravity model of international trade and apply the model to monthly US port level trade data. Empirically, I estimate the dynamic evolution of trade effects caused by Hurricane Katrina differentiating trade disruptions at the local port level. The estimates point to the static and dynamic resilience of international trade. While ports closest to Katrina's epicenter experience significant short-run reductions that can be of permanent nature, international trade handled by nearby ports rises in response to this disaster, both in the short- and in the long-run. Overall, the analysis underlines the significance of local infrastructure networks to reduce the devastation inflicted by natural disasters. This dissertation includes previously unpublished co-authored material.Item Open Access Exchange Rate Fluctuations, Currency Invoicing, and International Trade(University of Oregon, 2015-08-18) Roehling, Allison; Blonigen, Bruce A.Economic intuition suggests that real currency depreciation should lead to long run improvement in a country's trade balance. The short run implications of real depreciation are relatively unknown. The current literature suggests that the short run relationship between trade and real exchange rates is country-specific. This literature has not explored if product and trading partner characteristics play a role in this relationship. This dissertation explores how heterogeneity in trade influences the responsiveness of trade to real exchange rate fluctuations. To my knowledge, this is the first set of papers exploring this heterogeneity. The first paper of this dissertation explores heterogeneity with U.S. commodity-level trade data. Trade responsiveness to real fluctuations varies across product and trading partner characteristics. I find no evidence of long run gains in trade following real depreciation, suggesting that currency manipulation policies meant to improve a country’s trade balance may have no effect on trade in the long run. Prices in international trade contracts with U.S. firms are largely invoiced in U.S. dollars. However, the current literature suggests that the currency in which these prices are set should affect the relationship between trade and real exchange rates in the short run. The second paper of this dissertation explores the implications of currency invoicing patterns using Japanese commodity-level trade data. I find that the response of trade to real fluctuations may differ in the short and long run across product and trading partner characteristics. I also find that the response of trade in the long run may be correlated with comparative advantage. The third paper of this dissertation explores the implications of foreign exchange market liberalization in Japan following the Asian Financial Crisis. I find that liberalization, coupled with financial market reforms, resulted in trade being less responsive to real fluctuations. I also find no evidence of long run trade balance improvement before or after liberalization and that the reform may have eliminated temporary short run gains, suggesting that currency manipulation policies may have no effect on short or long run trade.Item Open Access The Impact of Transportation Costs and Trade Barriers on International Trade Flows(University of Oregon, 2015-08-18) Query, Jason; Blonigen, Bruce A.Because trade is seen as welfare improving for society, governments have long employed their policy-making powers to increase trade levels. In recent years, no strategy has been more employed by policy makers than free trade agreements. As free trade agreements become more popular, world tariff levels rapidly approach zero. Given this, policy makers must look to other methods to encourage trade. I examine how non-tariff trade barriers impact international trade levels. By better understanding these trade barriers, policy makers will be able to make more informed decisions. To better understand non-tariff trade barriers, I begin with well-known impediments to trade, including the border effect, transportation costs, and the trade creation and trade diversion effects of regional trade agreements. I then demonstrate and examine heterogeneity in these trade costs. In Chapter II I examine the often-studied border effect, the notion that regions trade more intra-nationally than internationally. I demonstrate that smaller regions are less attractive to foreign trading partners than their larger counterparts. Fixed costs of crossing an international border, as well as more effective marketing methods, mean economically larger U.S. states or Canadian provinces see a smaller border effect. In Chapter III I look at how transportation costs incurred within the exporting country impact trade levels. Using a unique instrumental variable strategy, I show that the cost of getting a good to a port is a significant hindrance to trade. Finally, in Chapter IV I show that the benefits of joining the European Union are heterogeneous across countries. This means that while the E.U. may be beneficial on average, it may not be beneficial for individual countries.