Trade liberalization and foreign direct investment: an applied general equilibrium model for Costa Rica

This paper quantifies the welfare impact of unilateral trade liberalization and computes the optimal tariff structure for Costa Rica in the presence of trade-policy-induced international capital flows and foreign capital taxation. For this, an applied general equilibrium model integrating trade, capital flows and international capital income taxation is used. The model has been calibrated to a 1990-91 data set for the economies of Costa Rica and a group of OECD countries. In the model, foreign capital income is taxed by host countries and the tax-credit system operates in foreign investors home countries. Results for Costa Rica show that complete trade liberalization ends up being welfare-reducing, as it leads to an outflow of capital and loss of tax revenue which more than offset the efficiency gains from an enhanced resource allocation. The optimal tariff structure for the Costa Rican economy turns out to be a mixture of import tariffs and subsidies, though of a relatively small level

Demand Side Considerations and the Trade and Wages Debate

Recent trade and wages literature focuses on whether trade or technology has been the major source of increases in wage inequality in OECD countries since the 1980s. In this literature, no attention has been paid to demand side considerations. Using a simple heterogeneous goods trade model of the Armington type, and UK data, we show how trade shocks affecting the price of unskilled-intensive goods can be absorbed on the demand side, with little or no impact on relative wage rates. No wage impact occurs if the elasticity of substitution in preferences between imports and import substitutes is one. As this elasticity increases, trade plays an ever larger role in explaining wage inequality changes, and as the elasticity goes below one the sign of the effect changes. We suggest that since many import demand elasticity estimates are in the neighbourhood of one, there is a prima facie case that demand side considerations further lower the significance of trade as an explanation of recent trends in OECD wage inequality -beyond that reported in recent literature.

Fuzzy reasoning in confidence evaluation of speech recognition

Confidence measures represent a systematic way to express reliability of speech recognition results. A common approach to confidence measuring is to take profit of the information that several recognition-related features offer and to combine them, through a given compilation mechanism , into a more effective way to distinguish between correct and incorrect recognition results. We propose to use a fuzzy reasoning scheme to perform the information compilation step. Our approach opposes the previously proposed ones because ours treats the uncertainty of recognition hypotheses in terms ofPeer ReviewedPostprint (published version

Contextual confidence measures for continuous speech recognition

This paper explores the repercussion of contextual information into confidence measuring for continuous speech recognition results. Our approach comprises three steps: to extract confidence predictors out of recognition results, to compile those predictors into confidence measures by means of a fuzzy inference system whose parameters have been estimated, directly from examples, with an evolutionary strategy and, finally, to upgrade the confidence measures by the inclusion of contextual information. Through experimentation with two different continuous speech application tasks, results show that the context re-scoring procedure improves the capabilities of confidence measures to discriminate between correct and incorrect recognition results for every level of thresholding, even when a rather simple method to add contextual information is considered.Peer ReviewedPostprint (published version

Investment Subsidies and Time-Consistent Environmental Policy

We describe a model of dynamic pollution abatement choices with heterogeneous agents, where, due to the presence of a distributional objective and to the absence of incentive-compatible compensation mechanisms, the choice of a second-best level of emission taxation is time-inconsistent. In this model, we investigate whether investment subsidies can act as a substitute for policy commitment.Pollution Abatement ; Emission Taxes ; Investment Subsidies

The Choice of Structural Model in Trade-Wages Decompositions

This paper explores the use of structural models as an alternative to reduced form methods when decomposing observed joint trade and technology driven wage changes into components attributable to each source. Conventional mobile factors Heckscher-Ohlin models typically reveal problems of specialisation unless price changes accompanying trade shocks are small, and can also produce wide ranges for the decomposition for parameterisations consistent with the joint change. A differentiated goods model which generalises Heckscher-Ohlin removes problems of specialisation and concentrates the range of decompositions more narrowly, but introduces larger demand side responses to trade shocks which greatly reduce the effect of trade. The conclusion offered is that the choice of structural model matters for decomposing observed wage changes into trade and technology components, and that reduced-form methods which do not discriminate between alternative structural models may not be that informative for such decompositions.

Decomposing Wage Inequality Change Using General Equilibrium Models

This paper presents ex post decomposition analysis of wage inequality change using multi-sector general equilibrium models. The analytical structure used is a specific- factors model of trade, which we calibrate to UK data for the two years 1979 and 1975. We first calibrate our general equilibrium trade model to observations on wage inequality, trade, production and consumption spanning these years, capturing the separate influences of trade, technology and demographics on inequality. Between these years wage inequality changed, but multiple changes in exogenous variables occurred (world prices, technology, endowments). We use calibration techniques to determine parameter values consistent with both the equilibria and the changes in exogenous variables contributing to the wage inequality change being decomposed. We then compute counterfactual equilibria in which only some of the changes in exogenous variables are present to allow us to assess what portion of the observed change is attributable to the various contributing factors. Our findings are that the roles of trade and factor-biased technological change are relatively larger than in earlier literature. We also find that changes in factor endowments to offset increased inequality generated by trade and skilled-biased technological changes, a feature that seems to have gone relatively unnoticed in earlier literature.

Debt Relief under the HIPC Initiative: Context and Outlook for Debt Sustainability and Resource Flows

Debt relief, External debt sustainability, HIPC Initiative, Poverty reduction

Debt Relief under the HIPC Initiative - Context and Outlook for Debt Sustainability and Resource Flows

external debt sustainability, HIPC Initiative, poverty reduction

Making Immigrants into Criminals: Legal Processes of Criminalization in the Post-IIRIRA Era

During a post-election TV interview that aired mid-November 2016, then President-Elect Donald Trump claimed that there are millions of so-called “criminal aliens” living in the United States: “What we are going to do is get the people that are criminal and have criminal records, gang members, drug dealers, we have a lot of these people, probably two million, it could be even three million, we are getting them out of our country or we are going to incarcerate.” This claim is a blatant misrepresentation of the facts. A recent report by the Migration Policy Institute suggests that just over 800,000 (or 7 percent) of the 11 million undocumented individuals in the United States have criminal records. Of this population, 300,000 individuals are felony offenders and 390,000 are serious misdemeanor offenders — tallies which exclude more than 93 percent of the resident undocumented population (Rosenblum 2015, 22-24).[1] Moreover, the Congressional Research Service found that 140,000 undocumented migrants — or slightly more than 1 percent of the undocumented population — are currently serving time in prison in the United States (Kandel 2016). The facts, therefore, are closer to what Doris Meissner, former Immigration and Naturalization Service (INS) Commissioner, argues: that the number of “criminal aliens” arrested as a percentage of all fugitive immigration cases is “modest” (Meissner et al. 2013, 102-03). The facts notwithstanding, President Trump’s fictional tally is important to consider because it conveys an intent to produce at least this many people who — through discourse and policy — can be criminalized and incarcerated or deported as “criminal aliens.” In this article, we critically review the literature on immigrant criminalization and trace the specific laws that first linked and then solidified the association between undocumented immigrants and criminality. To move beyond a legal, abstract context, we also draw on our quantitative and qualitative research to underscore ways immigrants experience criminalization in their family, school, and work lives. The first half of our analysis is focused on immigrant criminalization from the late 1980s through the Obama administration, with an emphasis on immigration enforcement practices first engineered in the 1990s. Most significant, we argue, are the 1996 Illegal Immigration Reform and Immigration Responsibility Act (IIRIRA) and the 1996 Antiterrorism and Effective Death Penalty Act (AEDPA). The second section of our analysis explores the social impacts of immigrant criminalization, as people’s experiences bring the consequences of immigrant criminalization most clearly into focus. We approach our analysis of the production of criminality of immigrants through the lens of legal violence (Menjivar and Abrego 2012), a concept designed to understand the immediate and long-term harmful effects that the immigration regime makes possible. Instead of narrowly focusing only on the physical injury of intentional acts to cause harm, this concept broadens the lens to include less visible sources of violence that reside in institutions and structures and without identifiable perpetrators or incidents to be tabulated. This violence comes from structures, laws, institutions, and practices that, similar to acts of physical violence, leave indelible marks on individuals and produce social suffering. In examining the effects of today’s ramped up immigration enforcement, we turn to this concept to capture the violence that this regime produces in the lives of immigrants. Immigrant criminalization has underpinned US immigration policy over the last several decades. The year 1996, in particular, was a signal year in the process of criminalizing immigrants. Having 20 years to trace the connections, it becomes evident that the policies of 1996 used the term “criminal alien” as a strategic sleight of hand. These laws established the concept of “criminal alienhood” that has slowly but purposefully redefined what it means to be unauthorized in the United States such that criminality and unauthorized status are too often considered synonymous (Ewing, Martínez, and Rumbaut 2015). Policies that followed in the 2000s, moreover, cast an increasingly wider net which continually re-determined who could be classified as a “criminal alien,” such that the term is now a mostly incoherent grab bag. Simultaneously and in contrast, the practices that produce “criminal aliens” are coherent insofar as they condition immigrant life in the United States in now predictable ways. This solidity allows us to turn in our conclusion to some thoughts about the likely future of US immigration policy and practice under President Trump. [1] These numbers are based on the assumption that “unauthorized immigrants and lawful noncitizens commit crimes at similar rates” (Rosenblum 2015, 22). However, there is research that provides good support that criminality among the undocumented is lower than for the foreign-born population overall (Rumbaut 2009; Ewing, Martínez, and Rumbaut 2015)