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UBC Theses and Dissertations

Essays on the mobility of goods and people Wagner, Donald Mark

Abstract

This thesis comprises three essays on the international movement of merchandise and people. The first essay measures the effects of foreign aid flows on a donor's merchandise exports. On average, donor countries tie approximately 50% of their foreign aid to exports, but the export stimulation of aid may exceed the amount that is directly tied. This essay uses the gravity model of trade to statistically test the link between aid and export expansion. The results suggest that aid is associated with an increase in exports of goods amounting to 120% of the aid. The essay also makes comparisons among donors and finds that Japan, which has drawn harsh criticism for using aid to gain unfair trade advantages, derives less merchandise exports from aid than the average donor. The second essay investigates the effects of immigration on Canada's pattern of trade. I derive three alternative functional forms capturing the relationship between immigration and trade based on the proposition that immigrants use their superior "market intelligence" to exploit new trade opportunities. I then employ province-level trade data with over 150 trading partners to identify immigrant effects and obtain results suggesting that immigrants account for over 10% of Canada's exports. The third essay addresses the question of whether tax differences contribute toward the brain drain from Canada to the U.S. This essay tests whether the U.S.'s lower taxes draw Canadians south by examining a sample of Canadians living in Canada and a sample of Canadians living in the U.S. Using information from these samples I estimate how much these individuals would earn in the opposite country and estimate the taxes they would pay. I find that the people who have the most to gain in income and in tax-savings are the most likely to choose to live in the U.S., and thus corroborate the claim that tax differences contribute toward Canada's brain drain.

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