Working Paper
How Much Will the Belt and Road Initiative Reduce Trade Costs?
de Soyres, Francois; Mulabdic, Alen; Murray, Siobhan; Rocha, Nadia; Ruta, Michele (2020-02-26)
This paper studies the impact of transport infrastructure projects of the Belt and Road Initiative on shipment times and trade costs. Based on a new data on completed and planned Belt and Road transport projects, Geographic Information System analysis is used to estimate shipment times before and after the Belt and Road Initiative. Two sets of data are computed to address different research questions: a global database based on an analysis of 1,000 cities in 191 countries and 47 sectors and a regional database that focuses on more granular information (1,818 cities) for Belt and Road ...
International Finance Discussion Papers , Paper 1274

Working Paper
Common Transport Infrastructure: A Quantitative Model and Estimates from the Belt and Road Initiative
de Soyres, Francois; Mulabdic, Alen; Ruta, Michele (2020-02-26)
This paper presents a structural general equilibrium model to analyze the effects on trade, welfare, and gross domestic product of common transport infrastructure. The model builds on Caliendo and Parro (2015) to allow for changes in trade costs due to improvements in transportation infrastructure, financed through domestic taxation, connecting multiple countries. The model highlights the trade impact of infrastructure investments through cross-border input-output linkages. This framework is then used to quantify the impact of the Belt and Road Initiative. Using new estimates on the effects ...
International Finance Discussion Papers , Paper 1273

Working Paper
Global Trade and GDP Co-Movement
de Soyres, Francois; Gaillard, Alexandre (2020-05-27)
We revisit the association between trade and GDP comovement for 135 countries from 1970 to 2009. Guided by a simple theory, we introduce two notions of trade linkages: (i) the usual direct bilateral trade index and (ii) new indexes of common exposure to third countries capturing the role of similarity in trade networks. Both measures are economically and statistically associated with GDP correlation, suggesting an additional channel through which GDP fluctuations propagate through trade linkages. Moreover, high income countries become more synchronized when the content of their trade is ...
International Finance Discussion Papers , Paper 1282

Discussion Paper
How Global Value Chains Change the Trade-Currency Relationship
de Soyres, Francois; Frohm, Erik; Gunnella, Vanessa (2020-02-03)
This note summarizes the main results of the de Soyres et al. (2018) paper, drawing out the most policy-relevant implications.
FEDS Notes , Paper 2020-02-03

Discussion Paper
Increasing Business Cycles Synchronization: The Role of Global Value Chains, Market Power and Extensive Margin Adjustments
de Soyres, Francois; Gaillard, Alexandre (2019-12-13)
In this note, based on de Soyres and Gaillard (2019a, 2019b), we argue that the propagation of shocks across countries through trade linkages is large and propose the first model that accounts for such propagation with a magnitude in line with the data.
FEDS Notes , Paper 2019-12-13-3