Professor Scott L. Baier
I am a Professor in the John E. Walker Department of Economics at Clemson University. Currently, I am also serving as the (acting) Associate Dean of Research for the Wilbur O. and Ann Powers College of Business. Prior to this appointment I was of the Chair of the Economics Department from 2016-2024. My main areas of research are international trade and economic growth. As this website evolves, it will eventually have links to current working papers, links to published papers and access to the data sets and programs.
Gravity and Gobalization with Samuel Standaert: In their 2002 paper, Lai and Trefler showed that while the gravity model can account for a large share of the cross-sectional variation of bilateral trade flows, it does a poor job of explaining how trade changes over time. In order to better account for the growth of trade, we propose an empirical specification that allows for shocks to global trade costs. While these shocks are global meaning that they affect all country pairs, the extent to they affect trade is allowed to differ for each importer-exporter combination. To estimate this model, we employ a Bayesian Gibbs sampling approach where the trade shocks are identified using state-space techniques. We find that the trade shocks show a very strong and robust pattern over time, bearing a close resemblance to shocks to total factor productivity; that is, like total factor productivity, they can be measured, but the cause and/or nature of the shock is no known. By augmenting a structural gravity model with these global trade shocks, we are able to explain roughly 60 percent of the growth of bilateral trade. Furthermore, the inclusion of trade shock
A substantial body of literature establishes that economic integrations agreements (EIAs) facilitate trade among member countries. However, their impact on migration flows remains less understood. In this paper, we construct a stylized spatial general equilibrium model to study the impact of economic integration agreements on trade and migration. The model is similar to that of Allen and Arkolakis (2014) and Redding
and Rossi-Hansberg (2017), and yields structural gravity equations for both trade andmigration that allow us to estimate the direct impact of trade agreements on trade and
migration flows. Given these parameter estimates, we can simulate the spatial model do highlight the general equilibrium effects of trade agreements on trade and migration.
In our simulation exercise, we show that if the United States-Mexico-Canada Agreement (USMCA) were modified to have the trade-creating effect of a common market, it would foster more trade within the group and encourage in-migration from outside the trading bloc. If the USMCA was also modified to allow migration costs to fall to the level of a common market, the within-migration impact on trade and welfare would
be more modest.
