Advanced Search
MyIDEAS: Login to save this article or follow this journal

Are Exports of China, Japan and Korea Diverted in the Major Regional Trading Blocs?


Author Info

  • Hyun-Hoon Lee
  • Chung Mo Koo
  • Euijeong Park


In recent years China, Japan and Korea, the three major economies in East Asia, have been gearing up their efforts to sign free trade agreements with many different regions and countries. One of the main reasons for this is that they fear that with a regionalism movement rising in every corner of the world, their exports are discriminated against and diverted in the trading blocs of other nations. The main purpose of this paper is to investigate whether this is a real fear. We utilise the gravity equation augmented with dummy variables for regional trading blocs in three different specifications. One is the static, standard gravity model to examine the effect of regional blocs on the 'level' of exports from these three countries in 2003; the second is the fixed effects and random effects panel models for the period 1993-2003; and the third is the dynamic, partial-adjustment model to examine the effect of blocs on the 'changes' in exports between 1993 and 2003. The results show that trade diversion is observed only for China's exports in EU, EFTA and EAEC, but no diversion effect is observed for Japan's and Korea's exports in any of the major trading blocs. On the other hand, trade creation is observed for exports from China in ASEAN, for exports from Japan in ASEAN, CACM, CARICOM, EAEC, EU and NAFTA, and for exports from Korea in ASEAN, CACM, EAEC and MERCOSUR. Thus, Japan's and Korea's fear of discrimination and trade diversion is ungrounded, while China's fear is grounded only to a limited extent. Copyright 2008 The Authors. Journal compilation 2008 Blackwell Publishing Ltd.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL:
File Function: link to full text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Wiley Blackwell in its journal World Economy.

Volume (Year): 31 (2008)
Issue (Month): 7 (07)
Pages: 841-860

as in new window
Handle: RePEc:bla:worlde:v:31:y:2008:i:7:p:841-860

Contact details of provider:
Web page:

Order Information:

Related research



No references listed on IDEAS
You can help add them by filling out this form.


Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Lee, Hyun-Hoon & Park, Donghyun & Wang, Jing, 2013. "Different types of firms, different types of products, and their dynamics: An anatomy of China's imports," China Economic Review, Elsevier, vol. 25(C), pages 62-77.
  2. Richard Pomfret, 2009. "Regionalism in the Asia-Pacific Region: How Wide, How Deep?," School of Economics Working Papers 2009-31, University of Adelaide, School of Economics.


This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.


Access and download statistics


When requesting a correction, please mention this item's handle: RePEc:bla:worlde:v:31:y:2008:i:7:p:841-860. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.