As governments resort to industrial policies to achieve economic and non-economic objectives, the number of subsidies implemented each year has more than tripled in the last decade. Using detailed data across a large number of advanced and emerging economies, we empirically investigate the effects of domestic subsidies on international trade flows. Estimates from a difference-in-difference specification show that on average subsidies promote both exports and imports. These effects are partly driven by selection into subsidies, as governments target export-oriented and import-competing products. The results however mask significant differences across countries. Specifically, exports of subsidized products from G20 emerging markets increase 8 percent more than exports of other products, with no evidence of selection. The gravity estimates confirm that subsidies promote international relative to domestic trade. These spillover effects are concentrated in some industries, such as electrical machinery, and are stronger when subsidies are given through tax breaks than other policy instruments. The subsidy-led rise in trade calls for international cooperation to manage risks of retaliatory actions and possible drifts towards a subsidy war.

A New Global Economic Order: New Challenges to International Trade Law examines the dislocating effects of the policies implemented by the Trump Administration on the global economic order and brings together leading scholars and practitioners of international economic law come together to defend multilateralism against unilateralism and populism.

What guidance does academic research really provide to economic policy development? The critical and analytical surveys in this volume investigate links between policies and outcomes by surveying work from broad macroeconomic policies to interventions in microfinance. Asserting that there are no universal correspondences between policies and outcomes, contributors demonstrate instead that only an intense familiarity with the development context and the universe of applicable economic models can generate successful policies. Getting cause-and-effect right is essential for policy design and implementation. With the goal of drawing researchers and policy makers closer, this volume highlights our increasing understanding of ways to combine economic theorizing with careful, thoughtful empirical work. - Presents an accurate, self-contained survey of the current state of the field - Summarizes the most recent discussions, and elucidates new developments - Although original material is also included, the main aim is the provision of comprehensive and accessible surveys

In the Middle East and North Africa (MENA) countries price subsidies are common, especially on food and fuels. However, these are neither well targeted nor cost effective as a social protection tool, often benefiting mainly the better off instead of the poor and vulnerable. This paper explores the challenges of replacing generalized price subsidies with more equitable social safety net instruments, including the short-term inflationary effects, and describes the features of successful subsidy reforms.

Highlights what national governments should know to properly conduct their industrial policies under the multilateral trading system.

Does the WTO leave appropriate policy space to its Members to pursue legitimate objectives, such as the economic development of developing countries, the conversion to a greener economy, or recovery in times of a global economic downturn? This legal and normative analysis of the WTO rules on subsidies and countervailing measures sheds light on why governments resort to subsidization and, by tracing the historical origins of the SCM Agreement and the Agreement on Agriculture, on why they have been willing to gradually confine their policy space. This sets the stage for a systematic and comprehensive legal analysis of both agreements, which integrates the vast amount of case law and proposals tabled in the Doha round. A separate case study explores the complex rules on export credit support, and the book closes with an in-depth normative assessment of these WTO rules on subsidies and countervailing measures.

Deep trade agreements (DTAs) cover not just trade but additional policy areas, such as international flows of investment and labor and the protection of intellectual property rights and the environment. Their goal is integration beyond trade or deep integration. These agreements matter for economic development. Their rules influence how countries (and hence, the people and firms that live and operate within them) transact, invest, work, and ultimately, develop. Trade and investment regimes determine the extent of economic integration, competition rules affect economic efficiency, intellectual property rights matter for innovation, and environmental and labor rules contribute to environmental and social outcomes. This Handbook provides the tools and data needed to analyze these new dimensions of integration and to assess the content and consequences of DTAs. The Handbook and the accompanying database are the result of collaboration between experts in different policy areas from academia and other international organizations, including the International Trade Centre (ITC), Organisation for Economic Co-operation and Development (OECD), United Nations Conference on Trade and Development (UNCTAD), and World Trade Organization (WTO).