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Dennis Novy.

Dennis Novy

Associate

Expertise: international trade, international economics, macroeconomics, economic history.

Telephone:
0247 615 0046
Email:
d.novy1@lse.ac.uk
d.novy@warwick.ac.uk
Room:
32L 2.23 B
Connect:
Twitter
Website
CV
Links:
CEP Trade
University of Warwick

Biography

Dr Dennis Novy is Professor of Economics at the University of Warwick. He is a Research Fellow at the Centre for Economic Policy Research (CEPR) and an Associate at the Centre for Economic Performance (CEP) at the London School of Economics. Dennis was appointed to the UK Council of Economic Advisers by the Chancellor of the Exchequer in 2018. He was the Specialist Adviser to the House of Lords on the Transatlantic Trade and Investment Partnership (TTIP). He received a PhD from the University of Cambridge.

Current areas of research include:

  • International trade: Trade costs and gravity equations; Brexit; Trading networks; Trade and uncertainty; Spatial location of economic activity
  • International economics and macroeconomics: Exchange rates; Currencies of invoicing currencies; Currency unions; Consumer price inflation
  • Economic history: Trading blocs and trade wars; History of trade policy

Publications

Journal article
Gravity and Heterogeneous Trade Cost Elasticities

How do trade costs affect international trade? This paper offers a new approach. We rely on a flexible gravity equation that predicts variable trade cost elasticities, both across and within country pairs. We apply this ... Read more...

Natalie Chen and Dennis Novy

01 May 2022

Blog
Import liberalisation as export destruction: evidence from the United States

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson look at US-China trade relations to examine how import liberalisation brings down import costs and increases competition, but can also lead to lower export ... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

11 April 2022

Journal article
Vehicle Currency Pricing and Exchange Rate Pass-Through

Using detailed firm-level transactions data for UK imports, we find that invoicing in a vehicle currency is pervasive, with more than half of the transactions in our sample invoiced in neither sterling nor the exporter’s... Read more...

Natalie Chen, Wanyu Chung and Dennis Novy

01 February 2022

Journal article
The Brexit vote, inflation and UK living standards

This article studies how voting for Brexit affected living standards in the United Kingdom. Using heterogeneity in exposure to import costs across product groups, we analyze how the depreciation of sterling caused by the... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

01 February 2022

Journal article
Estimating border effects: the impact of spatial aggregation

Trade data are typically aggregated across space. In this article, we investigate the sensitivity of gravity estimation to spatial aggregation. We build a model in which micro regions are aggregated into macro regions. W... Read more...

Cletus C. Coughlin and Dennis Novy

01 November 2021

CEP discussion papers
Trade, gravity and aggregation

Gravity regressions are a common tool in the empirical international trade literature and serve an important function for many policy purposes. We study to what extent micro-level parameters can be recovered from gravity... Read more...

Holger Breinlich, Dennis Novy and J.M.C. Santos Silva

22 September 2021

Blog
The impact of trade costs can be weak or strong - depending on how much countries trade

Many countries try to bring down trade costs by striking free trade agreements, forming currency unions or joining the WTO. But when trade costs fall, how much does trade increase? Natalie Chen and Dennis Novy explain th... Read more...

Natalie Chen and Dennis Novy

17 September 2021

CEP discussion papers
Import liberalization as export destruction? Evidence from the United States

How does import protection affect export performance? In trade models with scale economies, import liberalization can reduce an industry's exports by cutting domestic production. We find this export destruction mechanism... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

30 June 2021

Journal article
Trade and uncertainty

We offer a new explanation as to why international trade is so volatile in response to economic shocks. Our approach combines the idea of uncertainty shocks with international trade. Firms order inputs from home and fore... Read more...

Dennis Novy and Alan M. Taylor

01 October 2020

Journal article
Trade Blocs and Trade Wars during the Interwar Period

What precisely were the causes and consequences of the trade wars in the 1930s? Were there perhaps deeper forces at work in reorienting global trade prior to the outbreak of World War II? And what lessons may this partic... Read more...

David S. Jacks and Dennis Novy

01 July 2020

Journal article
Voting with their money: Brexit and outward investment by UK firms

We study the impact of the 2016 Brexit referendum on UK foreign direct investment. Using the synthetic control method to construct appropriate counterfactuals, we show that by March 2019 the Leave vote had led to a 17% i... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

01 May 2020

CEP discussion papers
Exchange rates and consumer prices: evidence from Brexit

This paper studies how the depreciation of sterling following the Brexit referendum affected consumer prices in the United Kingdom. Our identification strategy uses input-output linkages to account for heterogeneity in e... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

10 December 2019

CEP discussion papers
Voting with their money: Brexit and outward investment by UK firms

We study the impact of the 2016 Brexit referendum on UK foreign direct investment. Using the synthetic control method to construct appropriate counterfactuals, we show that by March 2019 the Leave vote had led to a 17% i... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

24 July 2019

CentrePiece - The magazine of the Centre for Economic Performance
In brief...Brexit and outward investment by UK firms

Media reports have highlighted that some UK firms have started to move production abroad in anticipation of Brexit. CEP analysis confirms that there has indeed been a substantial increase in outward investments. The shif... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

01 July 2019

CEP discussion papers
Vehicle currency pricing and exchange rate pass-through

Using detailed firm-level transactions data for UK imports, we find that invoicing in a vehicle currency is pervasive, with more than half of transactions in our sample invoiced in neither sterling nor the exporter's cur... Read more...

Natalie Chen, Wanyu Chung and Dennis Novy

04 June 2019

CEP discussion papers
Trade blocs and trade wars during the interwar period

What precisely were the causes and consequences of the trade wars in the 1930s? Were there perhaps deeper forces at work in reorienting global trade prior to the outbreak of World War II? And what lessons may this partic... Read more...

David S. Jacks and Dennis Novy

16 May 2019

CEP Brexit analysis Papers
Voting with their money: Brexit and outward investment by UK firms

Foreign direct investment (FDI) has grown rapidly in recent decades. Through FDI, firms headquartered in the UK can own and operate subsidiaries throughout the world. FDI opportunities give firms a choice between investi... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

11 February 2019

Journal article
Who voted for Brexit? Individual and regional data combined

Previous analyses of the 2016 Brexit referendum used region-level data or small samples based on polling data. The former might be subject to ecological fallacy and the latter might suffer from small-sample bias. We use ... Read more...

Eleonora Alabrese, Sascha O. Becker, Thiemo Fetzer and Dennis Novy

01 January 2019

Journal article
The Economic Effects of Brexit: Evidence from the Stock Market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investors� expectations about the effects of leaving theEuropean Union on the UK economy. Our results suggest that initial sto... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy, Thomas Sampson and Ahmed Usman

01 December 2018

CEP discussion papers
The economic effects of Brexit - evidence from the stock market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investors’ expectations about the effects of leaving the European Union on the UK economy. Our results suggest that initial stoc... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy, Thomas Sampson and Ahmed Usman

07 September 2018

Journal article
Market Potential and Global Growth over the Long Twentieth Century

We examine the evolution of market potential and its role in driving economic growth over the long twentieth century. Theoretically, we exploit a structural gravity model to derive a closed-form solution for a widely-use... Read more...

David S. Jacks and Dennis Novy

01 September 2018

CEP discussion papers
Market potential and global growth over the long twentieth century

We examine the evolution of market potential and its role in driving economic growth over the long twentieth century. Theoretically, we exploit a structural gravity model to derive a closed-form solution for a widely-use... Read more...

David S. Jacks and Dennis Novy

20 July 2018

CEP discussion papers
Currency unions, trade and heterogeneity

How do trade costs affect international trade? This paper offers a new approach. We rely on a flexible gravity equation that predicts variable trade cost elasticities, both across and within country pairs. We apply this ... Read more...

Natalie Chen and Dennis Novy

15 June 2018

CEP Brexit analysis Papers
The Brexit vote, inflation and UK living standards

The vote to leave the European Union (EU) was an unanticipated shock to the UK economy that increased uncertainty and reduced the country’s expected future openness to trade, investment and immigration with the EU. Our r... Read more...

Holger Breinlich, Elsa Leromain, Dennis Novy and Thomas Sampson

20 November 2017

Journal article
Who voted for Brexit? A comprehensive district-level analysis

On 23 June 2016, the British electorate voted to leave the European Union (EU). We analyse vote and turnout shares across 380 local authority areas in the United Kingdom. We find that exposure to the EU in terms of immig... Read more...

Sascha O. Becker, Thiemo Fetzer and Dennis Novy

01 October 2017

CEP discussion papers
Who voted for Brexit? A comprehensive district-Level analysis

On 23 June 2016, the British electorate voted to leave the European Union. We analyse vote and turnout shares across 380 local authority areas in the United Kingdom. We find that exposure to the EU in terms of immigratio... Read more...

Sascha O. Becker, Thiemo Fetzer and Dennis Novy

24 April 2017

CEP discussion papers
Estimating border effects: the impact of spatial aggregation

Trade data are typically reported at the level of regions or countries and are therefore aggregates across space. In this paper, we investigate the sensitivity of standard gravity estimation to spatial aggregation. We bu... Read more...

Cletus C. Coughlin and Dennis Novy

06 May 2016

CentrePiece - The magazine of the Centre for Economic Performance
TTIP: is free trade coming to the North Atlantic?

If successfully concluded, the Transatlantic Trade and Investment Partnership (TTIP) would be the most ambitious free trade agreement in history. Dennis Novy explains that while the potential benefits from liberalised tr... Read more...

Dennis Novy

19 January 2015

CEP discussion papers
Trade and Uncertainty

We offer a new explanation as to why international trade is so volatile in response to economic shocks. Our approach combines the uncertainty shock idea of Bloom (2009) with a model of international trade, extending the ... Read more...

Dennis Novy and Alan M. Taylor

21 May 2014

CEP discussion papers
On the Measurement of Trade Costs: Direct vs. Indirect Approaches to Quantifying Standards and Technical Regulations

In this article, we review the literature on the measurement of trade costs in international trade with a special emphasis on nontariff measures and in particular on standards and technical regulations. We distinguish ‘d... Read more...

Natalie Chen and Dennis Novy

13 September 2012

CEP discussion papers
Is the International Border Effect Larger than the Domestic Border Effect? Evidence from U.S. Trade

Many studies have found that international borders represent large barriers to trade. But how do international borders compare to domestic border barriers? We investigate international and domestic border barriers in a u... Read more...

Cletus C. Coughlin and Dennis Novy

07 September 2012

CEP discussion papers
Gravity Redux: Measuring International Trade Costs with Panel Data

Barriers to international trade are known to be large but due to data limitations it is hard to measure them directly for a large number of countries over many years. To address this problem I derive a micro-founded meas... Read more...

Dennis Novy

17 January 2012

CEP discussion papers
International Trade Without CES: Estimating Translog Gravity

This paper derives a micro-founded gravity equation in general equilibrium based on a translog demand system that allows for endogenous markups and substitution patterns across goods. In contrast to standard CES-based gr... Read more...

Dennis Novy

01 December 2010

CEP discussion papers
International Trade Integration: A Disaggregated Approach

This paper investigates the sources and size of trade barriers at the industry level. We derive a micro-founded measure of industry-specific bilateral trade integration that has an in-built control for time-varying multi... Read more...

Natalie Chen and Dennis Novy

01 January 2009

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