St. Louis Fed Publication Focuses on Trends in International Trade

ST. LOUIS—The latest issue of The Regional Economist, a publication of the Federal Reserve Bank of St. Louis, explores trends in and prospects for international trade.

In separate reports, economists examine:

• an alternative definition of “regional” in order to understand trade and interconnectedness of countries’ business cycles;

• the increasing importance of contract enforcement, corruption controls and other institutions in facilitating trade; and

• the factors behind the dramatic increase in international trade, and what can be done to increase it further.

In the first article, the authors look at a new way of defining “region”: countries that have such things as language, culture and institutions in common, as opposed to just being physically adjacent.  The rising popularity and significance of regional trade pacts are also explored.

In the second article, the authors note that in the past, the study of international trade often focused on differences in labor, land, capital and the distance between trading partners. But economists are increasingly looking at the role played by courts and other institutions “that lay down the rules, procedures and guidelines for trade in a clear and transparent manner, as well as institutions that protect traders from predation.”  Such institutions are particularly needed by countries that want to produce and export sophisticated high-quality products.

In the third article, the author shows that most of the growth in trade over the last half of the 20^th century and the first part of this one can be attributed to countries that have been trading with one another since the 1940s.  She briefly explains what can be done to encourage trade among new partners.

Other topics covered in the latest issue of The Regional Economist include gender wage gaps and labor force participation rates among married and never-married individuals, the costs of credit card default, stimulus funding for public school districts, and the track record for business startups in the Eighth Federal Reserve District and the nation.

The full publication is now available online.