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© Yuan Zi

Yuan Zi

University of Oslo

Yuan Zi is an Assistant Professor in the Department of Economics at the University of Oslo, a senior researcher at University of Zurich and a research affiliate at the Centre for Economic and Policy Research (CEPR). Her research interests include international trade, economic geography and economic development, with a special focus on global value chains, trade and labor market interactions and firms in international trade.
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publication
Trade costs, global value chains and economic development

This paper develops a model to study the impact of trade costs on developing countries’ industrialization when sequential production is networked in global value chains (GVCs). In a two-country setting, a decrease in trade costs of intermediates is associated with South joining and moving up the value chain and both North and South experiencing a welfare improvement. The wage gap between North and South first increases and then decreases. Extending the model to a multi-country setting, I show that reduced trade frictions lead to South countries joining GVCs due to wage differentials and low trade costs. This increases the wage in North but may decrease the wages of South countries that are already part of the network. Moreover, South countries that join tend to be regionally clustered. The model provides a first look at GVCs from the development angle, and raises policy questions regarding the governance of GVCs.

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publication
Trade From Space: Shipping Networks and The Global Implications of Local Shocks

This paper examines the structure of the shipping network and its implications on global trade and welfare. Using novel data on the movements of container ships, we calculate optimal travel routes. We then estimate the impact of a shock to the network on global trade by means of a natural experiment: the 2016 Panama Canal expansion. Trade between country pairs using the canal increased by 9-10% after the expansion. While the building costs were borne by Panama alone, a model-based quantification shows that the welfare gains were shared by many countries, due to the network structure of shipping.

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publication
Cascading trade protection: Evidence from the US

In a world with increasingly integrated global supply chains, trade policy targeting upstream products has unintended consequences on their downstream industries. In this paper, we examine whether protection granted to intermediate manufacturers leads to petition for protection by their downstream users. We first provide a simple model based on the quantitative framework of Ossa (2014) which identifies the key factors and their interactions that cause cascading protection to motivate our empirical analysis. Then, we test our model by identifying the input-output relationships among the time-varying temporary trade barriers of the US using its detailed input-output tables. As predicted by the theory, we find that measures on imported inputs increase the likelihood of their downstream users' subsequent trade remedy petition over the 1988–2013 period. Moreover, our simulation exercise shows that cascading protection can cause additional welfare losses, and hence we propose that trade policy investigations should take vertical linkages into account.

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