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Vertical specialization with developed and developing countries

Author

Listed:
  • Don P. Clark

    (University of Tennessee-Knoxville, USA)

Abstract

This paper investigates country and industry-level determinants of vertical specialization-based production and trade between the United States and both developed and developing countries. Industries engaged in vertical specialization are identified through their use of offshore assembly provisions in the U.S. tariff code. The main difference between developed and developing countries is that educational attainment of the workforce exerts a positive effect on vertical specialization with developed countries and a negative effect with developing countries. Most industry-level determinants exert similar influences on the decision to conduct vertical specialization with developed and developing countries. Global firms must choose between developed and developing countries when deciding where parts and components will be produced and where final products will be manufactured.

Suggested Citation

  • Don P. Clark, 2010. "Vertical specialization with developed and developing countries," Journal of Developing Areas, Tennessee State University, College of Business, vol. 43(2), pages 327-339, January-M.
    • Handle: RePEc:jda:journl:vol.43:year:2010:issue2:pp:327-339
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    File URL: http://muse.jhu.edu/journals/journal_of_developing_areas/v043/43.2.clark.html
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    Citations

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    Cited by:

    1. Shahrun Nizam Abdul-Aziz & Normala Zulkifli & Norimah Rambeli@Ramli & Noor Al-Huda Abdul Karim & Zainizam Zakariya & Norasibah Abdul Jalil, 2019. "The Determinations of East Asia¡¯s Automobile Trade Using a Gravity Model," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(5), pages 113-128, December.
    2. Maritza Sotomayor, 2016. "Vertical Specialization of Production: Critical Review and Empirical Evidence for the Mexican Manufacturing Industries 1994-2014," International Journal of Business and Social Research, LAR Center Press, vol. 6(2), pages 11-28, February.
    3. Maritza Sotomayor, 2016. "Vertical Specialization of Production: Critical Review and Empirical Evidence for the Mexican Manufacturing Industries 1994-2014," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 6(2), pages 11-28, February.
    4. Huriye Alkin, 2018. "Gelen Dogrudan Yabanci Sermaye Yatırimlari ile Geri Bag Arasindaki Iliski," EconWorld Working Papers 18002, WERI-World Economic Research Institute, revised Mar 2018.

    More about this item

    Keywords

    Vertical Specialization; Coproduction Arrangements; Offshore Assembly;
    All these keywords.

    JEL classification:

    • F0 - International Economics - - General
    • F1 - International Economics - - Trade

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