From the Editor

Dear Readers,

Welcome to the second issue of The International Trade Journal (ITJ)’s thirty-fifth volume. The articles in this issue look at how food safety scares affect exports, how outsourcing affects wages, how industrial clustering affects transportation costs at the U.S.-Mexico border, and how exchange rate volatility affects exports in Thailand.

The first article in this issue, by Elham Darbandi, Riza Radmehr, and Sayed H. Saghaian, looks at how food safety scares affect U.S. beef exports. They construct an index variable based on a LexisNexis search for keywords related to food safety. They find that an additional media report about food safety reduced exports by 0.8%.

The second article in this issue, by Kuang-Chung Hsu, Yungho Weng, and Hui-Chu Chiang, is a theoretical study. Using a model with unionized domestic firms that outsource some inputs from foreign producers, they assess how outsourcing affects wages in the home country.¹ They find that the effect depends on why the company chose to outsource more. If outsourcing increases because foreign workers’ productivity increases, this will increase wages in the home country. In contrast, if outsourcing increases because domestic workers’ productivity falls, wages will fall.

The third article in this issue, by Ernesto Duarte-Ronquillo and Thomas M. Fullerton, compares transportation costs in the four main custom districts on the U.S.-Mexico border: Laredo, El Paso, Nogales, and San Diego. They then relate transportation costs to the extent of industrial clustering in the districts. They find that greater clustering is associated with reduced transportation costs.

The final article, by Augustine C. Arize, Asli Ogunc, Ebere Ume Kalu, and John Malindretos, looks at how exchange rate volatility affects Thailand’s export demand after allowing for nonlinear asymmetric effects.² Using quarterly data from the beginning of 1973 through the end of 2017, they find a long-run negative relationship between exports and exchange rate volatility. They note, however, that this relationship is visible only after they allow for asymmetric effects; without doing this, they find that the model is mis-specified and that the evidence for cointegration is weaker.

As usual, we would like to thank the people without whom the ITJ would not succeed. We would like to thank the authors who contribute their articles, the anonymous referees who give detailed and timely comments, the team at the International Trade Institute at Texas A&M International University who process submissions quickly and efficiently, our Editorial Board who guide the journal, and our publisher, Taylor and Francis, who ensures the ITJ keeps its high standards.

Notes

¹ In a recent article in the ITJ, Hsu, Lin, and Weng (2015) look at how unionization in the U.S. affects international outsourcing.

² Several recent studies in the ITJ have used similar techniques to look at how exchange rates affect trade in Turkey, (Ari, Cergibozan, and Cevik 2019), Malaysia (Bahmani-Oskooee and Harvey 2018), and East Africa (Hunegnaw and Kim 2020).