Current Institutional Affiliation
Professor, Economics and Finance, Utah State University

I am a professor of economics in the Department of Economics and Finance, Huntsman School of Business, at Utah
State University. My area of research specializ ation is international trade theory and policy. My recent theory work
has looked at adjustment costs, automation, imperfect factor mobility, and outsourcing. I also do trade policy work,
especially computable general equilibrium analysis of trade policy developments. Much of my work in this area has
been on regional trading agreements in the Asia- Pacific.

Award Information

Abe Fellowship 2013
Institutional Affiliation (at time of award):
Professor, Economics and Finance, Utah State University
Quantitative Assessment of the Trans-Pacific Partnership

The Trans-Pacific Partnership (TPP) is the first regional trading agreement that would bring free trade between the economies of Japan and the United States, along with ten other nations. What will be the economic impact of the agreement on Japan and the other member economies? Numerical simulation methods can help us answer that question. I propose to travel to Hitotsubashi University for 12 months to study Japanese economic perspectives on, and formally model Japan's economic interests in, the TPP, using computable general equilibrium (CGE) techniques. The fellowship will allow me to work with leading international trade economists in Japan on an set of issues that are of substantial academic, policy, and social interest. The resulting research and quantitative assessments will be useful for academics studying regional trade agreements, and officials/policymakers in the US, Japan, and the other TPP member economies. CGE methods have been widely used to assess the economic impact of regional trade reforms. They are beginning to be applied to the TPP, and some early work from Japan has generated results that conflict with other research. The exact reasons for this discrepancy are unclear, but they must reflect different assumptions on the characteristics of the Japanese economy. Collaboratively developing transparent assumptions that accurately reflect the unique aspects of the Japanese economy is necessary. Specifically, in this project I will: (a) Work with Japanese economists to establish unique characteristics of the Japanese economy that will affect the economic outcomes associated with the TPP; (b) estimate a set of critical parameters describing import/domestic substitutability for key goods; (c) build a new CGE model of the Japanese economy that incorporates these features and using the model, simulate the economy-wide impact of the TPP; (d) use the quantitative simulation results to provide policy-relevant information to TPP members. The TPP is currently being negotiated. Regional trade liberalization is a defining trend in the current global trade environment. The information generated by this project will be useful not only in assessing the TPP but also in guiding future FTA proposals/negotiations. Hence, the project has a clear contemporary focus. While a free trade agreement between the member economies of the TPP has been committed to in principle, the details are still being decided. The proposed simulation work will provide direct quantitative insights into the economic impact of the policy proposals as they are being shaped. The project has the potential to directly inform the negotiations. Moreover, this work will not only quantify the effects of the TPP, but will also highlight unintended consequences. With this information, policymakers can design better implementations. Hence the project is policy relevant. The TPP is a transnational agreement. The nature of CGE modeling is such that the quantitative simulation results will be of interest to policymakers in all of the TPP countries. Japan is a major export market for the other TPP member economies, and the project will pay considerable attention to how the Japanese economic response will impact its partner economies. Hence the project has a transnational perspective.