Vanessa Cirannek

PhD Student in Economics
University of Potsdam
Stanford University
BMW PhD Fellow
vanessa.cirannek -AT-

About me ...

I am in my final year of being an economics Ph.D. student in the fields of international trade and econometrics. My research focusses on the supply of foreign markets, specifically the choice into exports and foreign production.

In my approach I developed a theoretical NEG model explaining the coexistence of exports and foreign production through export platforms. To test my theoretical findings I analyzed the global production and supply pattern of more than 100 automotive OEMs. The empirical results originating from simulation, descriptive statistics, regression analysis, choice modeling, and data mining, support my theoretical model and the significance of its main forces: Geographic distribution, political integration, production costs, and FDI friendly environment.

Professional Interest:

I am generally interested in understanding the economic behavior of firms and consumers in order to generate higher profitability and consumer satisfaction. It is my passion to evaluate the variety of alternatives/choices firms and consumers face in their actions. These business questions are traditionally addressed with financial models, moreover, I specifically want to exploit the increasing amount of data available and translate costumer insight into competitive advantage. In particular I extract trends/knowledge from data, utilizing techniques such as simulation, descriptive statistics, regression analysis, choice modeling, and data mining.

It is my interest to get my financial, statistics, and econometrics knowledge to work, and directly contribute to market research, business development, product development, and product placement.

Research Papers

Exports, Horizontal FDI and Export Platforms

International operating firms often follow complex market supply strategies, ranging from exports and Foreign Direct Investments (FDI) to regional export platforms. Explaining the driving forces behind multinational setups and their influence on the agglomeration-core pattern has become an emerging question pressuring economists to expand existing models. This paper builds on the fundaments of Brainard (1997), who introduces a multi production strategy into the classic NEG model and suggests that multinational activities either evolve into exports or horizontal FDI. By integrating Melitz (2003)'s concept of firm heterogeneity, Helpman, Melitz and Yeaple (2003) can already explain the co-existence of exports and horizontal FDI on the country-level. However, every firm follows a exclusive strategy, using only one distinct supply option to serve a foreign market.

In this paper I extend the work of Brainard (1997) to a three country world. By taking account for the relative distance between the countries, this model leads to three distinct supply scenarios. It explains the simultaneous existence of exports and horizontal FDI on the firm-level, and furthermore introduces the supply strategy of an export platforms.

Negotiating FTAs and the Role of Third Party Agreements - The Case of the ASEAN-EU FTA and the Automotive Market

This paper emphasizes the role of third party agreements in the evaluation of Free Trade Agreements (FTA). In particular, I study the implications of a FTA between the European Union (EU) and the Association of South East Asian Nations (ASEAN) for the automotive industry. The third party agreement I consider is the Japan-ASEAN FTA (JAEPA), coming into force in the year 2009. Allowing for various outcomes of the EU-ASEAN FTA negotiations, I analyze and compare the trade and welfare effects of four different scenarios: (1) No FTA, (2) ASEAN-EU FTA only, (3) JAEPA FTA only and (4) JAEPA + ASEAN-EU FTA. I apply the partial-equilibrium global simulation model (GSIM) developed by Francois and Hall (2003), which examines world trade between multiple regions and imperfect substitution of products across regions. Using data on aggregated trade in automotive goods and weighted average tariffs, I show, that the presence of JAEPA as a third party agreement influences intra-ASEAN integration, the advantages of the EU, and the competitive equality between Japan and the EU27.

From Trade and Spatial Theory to the New Economic Geography (NEG)

A long-standing goal of economic theory has been to explain the location of economic activity into agglomerated clusters and a periphery. In the past, two distinct fields independently examined this question: trade theory and spatial theory. The New Economic Geography (NEG) model developed by Paul Krugman in 1991 successfully integrates both approaches. This paper contrasts NEG with the theories of Ohlin, Samuelson-Mundell, von Thuenen, Weber and Loesch to understand the fundamental contributions preceding Paul Krugmans NEG. Many of the ideas such as the interactions between factor mobility and transportation costs, between economies of scale and transportation costs, circular causations, iceberg transportation costs and intra-industry trade have been addressed earlier in interdisciplinary models of trade and spatial theory. The real contribution of NEG thus lies in the integration of pre-existing theories into a unifying analytical formulation.
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