Ruta, Michele

Macroeconomics, Trade & Investment Global Practice
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International Economics, International Integration, Regional Integration
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Macroeconomics, Trade & Investment Global Practice
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Last updated: December 5, 2023
Michele Ruta is Lead Economist in the Macroeconomics, Trade & Investment Global Practice of the World Bank Group, where he leads the work program on regional integration. He had previous appointments as Economic Advisor to the Senior Director of the Trade & Competitiveness Global Practice (2015-2018), Senior Economist at the IMF (2013-2015), Counsellor at the WTO (2007-2013) and Marie Curie Fellow at the European University Institute (2004-2007). He holds a PhD in economics from Columbia University (2004) and an undergraduate degree from the University of Rome “La Sapienza” (1998). Michele’s research interests are in international economics, and particularly on issues concerning international/regional integration. He has published in refereed journals such as the Journal of International Economics, the Journal of Public Economics, and the Journal of the European Economic Association. He was a lead author of the World Trade Report of the WTO between 2008 and 2013, and contributed to many policy reports, including the Global Economic Prospects of the World Bank, and the World Economic Outlook of the IMF. His work has been cited, among others, in the Economist, Financial Times, Guardian, Le Monde.
Citations 52 Scopus

Publication Search Results

Now showing 1 - 10 of 46
  • Publication
    Trade and Infrastructure Integration in Africa
    (World Bank, Washington, DC, 2023-11-28) Fontagné, Lionel; Lebrand, Mathilde; Murray, Siobhan; Santoni, Gianluca; Ruta, Michele
    Economic integration of the African continent rests on two pillars: the ratification of an ambitious trade agreement and massive investment in transportation infrastructure. Leveraging a newly created city-level database on African exporters’ transport times, transport route optimization and general equilibrium modeling of international trade, the paper quantifies the impact of greater trade and transport integration in Africa. A pan-African agreement, such as the African Continental Free Trade Area, would increase African countries’ exports by an average of 3.4 percent and increase gross domestic product by 0.6 percent. Complementing trade integration by reducing transportation time on roads, ports and border posts would increase exports by 11.5 percent and increase gross domestic product by 2 percent. Major transport investments are necessary to reap the full benefits of the African Continental Free Trade Area.
  • Publication
    Deep Trade Agreements and Heterogeneous Firms Exports
    (World Bank, Washington, DC, 2023-01) Neri--Lainé, Matteo; Orefice, Gianluca; Ruta, Michele
    This paper studies the effect of regional trade agreements on firms’ exports. Using detailed information on the content of trade agreements and firm-level exports for 31 developing countries between 2000 and 2020, the analysis shows that the depth of trade agreements matters for the export performance of firms. Moving from shallow to deep trade agreements boosts firms’ exports, on average, by 3.6 percent. In line with models of trade with heterogeneous firms, the trade impact of deep trade agreements depends on firm’s characteristics. The impact is stronger for large firms and firms involved in global value chains and is negative for small firms. Robustness tests and an Instrumental Variable strategy confirm the causal interpretation of the results. These heterogeneous impacts on firms’ exports imply a selection effect of deep trade agreements with significant welfare consequences.
  • Publication
    Scarcity Nationalism during COVID-19: Identifying the Impact on Trade Costs
    (World Bank, Washington, DC, 2022-11) Egger, Peter H.; Masllorens, Gerard; Rocha, Nadia; Ruta, Michele
    During the COVID-19 pandemic, many countries used export and import policy as a tool to expand the availability of scarce critical medical products in the domestic market (scarcity nationalism). This paper assesses the direct and indirect (via trade in intermediates) increases in trade costs of critical medical goods resulting from these uncooperative policies. The results show that scarcity nationalism led to substantial increases in trade costs between February 2020 and December 2021 for most COVID-19 critical medical products, particularly garments (for example, face masks) and ventilators. The exception is vaccines, which saw a reduction in trade costs, which, however, was driven by the reduction in indirect trade costs for high-income countries, consistent with the view of a COVID-19 vaccine production club.
  • Publication
    Deep Trade Agreements: Anchoring Global Value Chains in Latin America and the Caribbean
    (Washington, DC : World Bank, 2022-07-12) Rocha, Nadia; Ruta, Michele
    International economic integration offers unexploited opportunities to Latin America and the Caribbean. This report studies how the region’s countries can leverage trade agreements to promote their economies’ participation in global value chains (GVCs).The gaps between potential and actual GVC integration follow from the region’s Economic fundamentals, such as geography, market size, institutions, and factor endowments. But policy choices matter as well. The report, based on new data and evidence, shows that trade agreements can drive policy reforms and help the region overcome some of its disadvantageous fundamentals. The report makes specific policy recommendations to guide Latin American and Caribbean countries in leveraging trade agreements to pursue greater international integration and economic growth. Four main findings emerge from the analysis: (i) Latin America and the Caribbean’s poor international integration and limited participation in GVCs have contributed to its low economic growth over the past decade; (ii) Although the region’s countries increasingly participate in preferential trade agreements (PTAs), there are gaps in the content of these agreements; (iii) Deep trade agreements present an avenue to promote trade and boost GVC integration and upgrading, thus contributing to improved economic performance; (iv) Four areas of deep integration - trade facilitation, regulatory cooperation, services, and state support - are priorities to improve these countries’ GVC participation and upgrading.
  • Publication
    Trade Policy and Exporters’ Resilience: Evidence from Indonesia
    (World Bank, Washington, DC, 2022-05) Cali, Massimiliano; Ghose, Devaki; Montfaucon, Angella Faith; Ruta, Michele
    How does trade policy affect exporters’ ability to respond to foreign demand shocks Faced with a sudden change in the demand for their goods, exporting firms must optimally change their inputs and/or input sources. This paper tests whether a country’s own trade policy makes such adjustments harder for firms that rely on imported inputs. The analysis exploits new time-varying data on tariffs and non-tariff measures faced by Indonesian firms and focuses on the impact of exchange rate shocks on exports to Japan. In response to a depreciation of the yuan, which makes Chinese exports more competitive, the findings show that firms that face non-tariff measures on their inputs see a much larger drop in their export values compared to firms that do not face any non-tariff measures. That is not the case for import tariffs on inputs, which do not affect the export response to the shock. This difference is consistent with the (partial) fixed costs imposed by non-tariff measures on imports in contrast to the pure variable costs of tariffs. The magnitude of this effect depends on the type of non-tariff measure and on firms’ characteristics, such as their participation in global value chains, size, and product quality.
  • Publication
    The Impact of Regional Trade Agreements on Georgia's Exporters: A Firm-Level Analysis
    (World Bank, Washington, DC, 2021-09) Neri-Laine, Matteo; Orefice, Gianluca; Ruta, Michele
    This paper assesses the trade impact of regional trade agreements signed by Georgia. Using information from the World Bank’s Deep Trade Agreements database and the Exporters’ Dynamics Database for Georgia for 2000–20, the paper tests the effect of regional trade agreements on the performance of Georgian exporters. The results show that the depth of regional trade agreements has a positive effect on the exports of firms, and the more so if trade agreements include legally enforceable provisions. Interestingly, the effect of regional trade agreements is not homogeneous across exporters with different characteristics. While large exporters and firms participating in global value chains benefit from deep trade agreements, small firms are negatively affected. Deep trade agreements have a positive effect on the probability of entry into the export market for large firms and firms in global value chains.
  • Publication
    Natural Disasters and the Reshaping of Global Value Chains
    (World Bank, Washington, DC, 2021-06) Freund, Caroline; Mulabdic, Alen; Ruta, Michele; Mattoo, Aaditya
    To understand the longer term consequences of natural disasters for global value chains, this paper examines trade in the automobile and electronic sectors after the 2011 earthquake in Japan. Contrary to widespread expectations, the analysis shows that the shock did not lead to reshoring, nearshoring, or diversification; and trade in intermediate products was disrupted less than trade in final goods. Imports did shift to new suppliers, especially where dependence on Japan was greater. But production relocated to developing countries rather than to other top exporters. Despite important differences, the observed pattern of switching may be relevant to disasters like the COVID-19 pandemic.
  • Publication
    Trade Facilitation Provisions in Preferential Trade Agreements: Impact on Peru’s Exporters
    (World Bank, Washington, DC, 2021-05) Lee, Woori; Rocha, Nadia; Ruta, Michele
    Trade facilitation measures that simplify, modernize, and harmonize export and import processes are particularly important in a world of global value chains where goods cross borders multiple times. At the firm level, trade facilitation commitments in preferential trade agreements can generate larger gains for firms participating in global value chains, as these firms can benefit both from efficiency enhancement at their own border (when importing inputs) and at the partner countries’ borders (when exporting). This paper uses Peruvian customs data to investigate the heterogeneous impact of trade facilitation provisions across firms, depending on their global value chain linkages. The results show that trade facilitation provisions in preferential trade agreements promote the export performance of global value chain firms, especially when they import inputs from the preferential trade agreement partner country. In the case of Peru, the main benefit of trade facilitation provisions results from efficiency enhancements at its own border, allowing global value chain firms to import inputs in a more timely and predictable manner.
  • Publication
    A General Equilibrium Assessment of the Economic Impact of Deep Trade Agreements
    (World Bank, Washington, DC, 2021-04) Fontagne, Lionel; Rocha, Nadia; Ruta, Michele; Santoni, Gianluca
    This paper explores the economic impacts of preferential trade agreements, focusing on the provisions they contain, beyond phasing out tariffs. Clustering 278 preferential trade agreements based on 906 provisions grouped into 18 policy areas, three clusters are obtained for which a trade elasticity to preferential trade agreement is estimated using structural gravity. A series of full general equilibrium counterfactual situations for endowment economies is simulated, revealing the economic impacts of deepening existing trade agreements and signing new ones—that is, the intensive and extensive margins of preferential trade agreements. The paper illustrates the method with a general deepening of existing preferential trade agreements worldwide. Focusing on the examples of the Latin America and the Caribbean and East Asia and Pacific regions, the paper shows that deepening preferential trade agreements leads to higher trade and welfare effects than signing new ones.
  • Publication
    Machine Learning in International Trade Research: Evaluating the Impact of Trade Agreements
    (World Bank, Washington, DC, 2021-04) Breinlich, Holger; Corradi, Valentina; Rocha, Nadia; Ruta, Michele; Santos Silva, J.M.C.; Zylkin, Tom
    Modern trade agreements contain a large number of provisions besides tariff reductions, in areas as diverse as services trade, competition policy, trade-related investment measures, or public procurement. Existing research has struggled with overfitting and severe multicollinearity problems when trying to estimate the effects of these provisions on trade flows. This paper builds on recent developments in the machine learning and variable selection literature to propose novel data-driven methods for selecting the most important provisions and quantifying their impact on trade flows. The proposed methods have the advantage of not requiring ad hoc assumptions on how to aggregate individual provisions and offer improved selection accuracy over the standard lasso. The analysis finds that provisions related to technical barriers to trade, antidumping, trade facilitation, subsidies, and competition policy are associated with enhancing the trade-increasing effect of trade agreements.