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North-South technology diffusion, regional integration, and the dynamics of the “natural trading partners” hypothesis

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Author Info
Maurice Schiff
Yanling Wang
Abstract

Based on static analysis, a number of studies argue that forming a regional trade agreement (RTA) is more likely to raise welfare if member countries are ?natural trading partners,? while other studies claim the opposite. This paper considers the argument from a dynamic viewpoint by examining the impact of trade with Japan, North America and the EU on technology diffusion and total factor productivity (TFP) in Jordan, Korea and Mexico. Using industry-level data, we show that: i) technology diffusion and productivity gains tend to be regional: Jordan, Korea, and Mexico tend to benefit mainly from trade with the EU, Japan, and North America respectively; and ii) the dynamic version of the ?natural trading partners? hypothesis seems to hold. JEL Classification: F02, F13, F15, F43, O39

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Publisher Info
Article provided by De Boeck Université in its journal Revue d'économie du développement.

Volume (Year): 21 (2007)
Issue (Month): 5 ()
Pages: 69-84
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Handle: RePEc:cai:edddbu:edd_215_0069

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Related research
Keywords: North-South technology diffusion; productivity; regional integration; natural trading partners; Korea; Mexico;

Find related papers by JEL classification:
F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F15 - International Economics - - Trade - - - Economic Integration
F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
O39 - Economic Development, Technological Change, and Growth - - Technological Change - - - Other

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This page was last updated on 2009-12-13.

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