Essays on International Trade and Energy Usage

Abstract

This dissertation explores research questions in international trade economics, with chapters on landlocked trade and deep-water ports trade, and in energy economics, with a chapter on residential energy usage. The first chapter looks into the effect of being landlocked on international trade flows in the manufacturing sector. The study overcomes the empirical challenge of using a country-specific variable ‘landlocked’, within a structural gravity framework in the presence of importer and exporter fixed effects. Results show that the impact of being landlocked for manufactured goods trade is highly negative and statistically significant. Such effect is higher for low-income landlocked countries as compared to high-income landlocked countries. The impact of being landlocked on manufactured goods trade declined in 2005 as compared to 1980. A series of robustness checks further confirm the estimates. The second chapter looks into the effects of having deeper ports, which are capable of hosting larger ships, on international trade in the manufacturing, agricultural, mining and services sectors, using a structural gravity model. Results show that countries with at least one port capable of hosting a Panamax ship (i.e., port depth of at least 41 feet) trade tremendously more (e.g., 163.0 to 174.8 percent more manufactured goods) than countries without such ports. Ten additional feet of port depth is estimated to increase a country's international trade in manufactured goods by 8.2 to 12.7 percent, in mining goods by 29.5 to 33.9 percent, and in agricultural goods by 31.9 to 34.1 percent. Port depth does not appear to be a strong determinant of trade in services, especially considering its effect on individual service industries. For trade in commodities, having more ports at deeper cutoff depths is shown to be an additional trade facilitator and most of the trade elasticities become even larger when landlocked countries are excluded from our sample. The third chapter, in energy economics, explores residential energy usage using a Conditional Demand Analysis model using data from the 2019 Residential Energy Use Survey. The study estimates the impact of solar photovoltaics (PV) and weather on the end use electricity consumption by residential households in Hawai`i. Hawai`i has a high penetration of distributed PV systems and this chapter delves into how electricity consumption in various households differs with and without photovoltaic systems. Results show that households with PV have more electric appliances and higher gross electricity usage than those without PV. Electricity usage by households with PV is more sensitive to weather than the usage by households without PV.