IDEAS home Printed from https://ideas.repec.org/a/taf/glecrv/v38y2009i1p63-76.html
   My bibliography  Save this article

Horizontal and Vertical Intra-industry Trade and Firm's Investment Strategies: Evidence from the IT Industry in the Asian, EU and US Markets

Author

Listed:
  • Shun-Chiao Chang

Abstract

This study investigates the features and determinants of the horizontal and vertical intra-industry trade (HIIT and VIIT, respectively) and firms' investment strategies of the information technology (IT) industry in the Asian, European Union (EU) and US markets from 1996 to 2005. The respective evolutions of the HIIT and VIIT of the IT industry indicate that HIIT has often dominated VIIT in the IT industry, which is obviously contrary to the present pattern of world trade. The empirical results further reveal the principal pattern of the IT firms' foreign direct investment strategies as facilitating the market rather than seeking efficiency in the host regions. The effect of revealed comparative advantage in relation to VIIT and HIIT demonstrates that vertical specialization is significant between Asia and the EU whereas horizontal specialization plays a key role between Asia and the US. The Asian financial crisis significantly promoted VIIT in regard to Asian IT firms in the US market. Finally, regional trade associations such as the EU and Association of South East Asian Nations (ASEAN) have strengthened the vertical specialization of EU IT firms in Asian countries.

Suggested Citation

  • Shun-Chiao Chang, 2009. "Horizontal and Vertical Intra-industry Trade and Firm's Investment Strategies: Evidence from the IT Industry in the Asian, EU and US Markets," Global Economic Review, Taylor & Francis Journals, vol. 38(1), pages 63-76.
  • Handle: RePEc:taf:glecrv:v:38:y:2009:i:1:p:63-76
    DOI: 10.1080/12265080802692696
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/12265080802692696
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/12265080802692696?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Frahan, Bruno Henry de & Tharakan, Joe, 1998. "Horizontal And Vertical Intra-Industry Trade In The Processed Food Sector," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20903, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Aggarwal, Sakshi, 2023. "The empirical measurement and determinants of intra-industry trade for a developing country," MPRA Paper 117112, University Library of Munich, Germany.
    2. Masoud Nonejad, 2012. "Measuring Goods Quality in Iran’s Intra- Industry Trade with G-8 Member States," Journal of Economics and Behavioral Studies, AMH International, vol. 4(6), pages 344-353.
    3. Sakshi Aggarwal & Debashis Chakraborty, 2021. "Which Factors influence Vertical Intra-Industry Trade in India? Empirical Results from Panel Data Analysis," Working Papers 2154, Indian Institute of Foreign Trade.
    4. Thorpe Michael William & Leitão Nuno Carlos, 2013. "Determinants of United States’ Vertical and Horizontal Intra-Industry Trade," Global Economy Journal, De Gruyter, vol. 13(2), pages 233-250, June.
    5. George Emm Halkos & Nickolaos Tzeremes, 2009. "Electricity Generation and Economic Efficiency: Panel Data Evidence from World and East Asian Countries," Global Economic Review, Taylor & Francis Journals, vol. 38(3), pages 251-263.
    6. Nuno Carlos LEITÃO & Marius-Razvan SURUGIU & Camelia SURUGIU, 2014. "Romanian intra-industry trade: a panel data approach," EuroEconomica, Danubius University of Galati, issue 2(33), pages 7-18, November.
    7. Sakshi Aggarwal & Debashis Chakraborty, 2022. "Which Factors Influence India’s Intra-Industry Trade? Empirical Findings for Select Sectors," Global Business Review, International Management Institute, vol. 23(3), pages 729-755, June.
    8. Maylene Y. Damoense-Azevedo & André C. Jordaan, 2012. "Factors influencing bilateral intra-industry trade in the auto industry: the case of South Africa," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 4(1/2), pages 63-82.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fertő, Imre & Hubbard, Lionel J., 2003. "A vertikálisan és horizontálisan differenciált mezőgazdasági termékek ágazaton belüli kereskedelme Magyarország és az Európai Unió Között [Intra-industry trade in vertically and horizontally differ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(2), pages 152-163.
    2. Fertő, Imre, 2006. "Vertikálisan és horizontálisan differenciált, ágazaton belüli kereskedelem az Európai Unió tejpiacán [Trade within vertically and horizontally differentiated industries on the milk market of the Eu," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(6), pages 526-539.
    3. Imre Ferto & Lionel J. Hubbard, 2002. "Intra-industry trade in horizontally and vertically differentiated agrifood products between Hungary and the EU," CERS-IE WORKING PAPERS 0202, Institute of Economics, Centre for Economic and Regional Studies.
    4. van Berkum, Siemen & van Meijl, Hans, 2000. "The application of trade and growth theories to agriculture: a survey," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 44(4), pages 1-38.
    5. Levkovych, Inna, 2011. "Der ukrainische Außenhandel mit Produkten der Agrar- und Ernährungswirtschaft: Eine quantitative Analyse aus Sicht traditioneller und neuer Außenhandelstheorien," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 59, number 109520.
    6. Imre Ferto & Lionel J. Hubbard, 2001. "Intra-Industry Trade in Agri-Food Products between Hungary and EU," CERS-IE WORKING PAPERS 0106, Institute of Economics, Centre for Economic and Regional Studies.
    7. Fertő, Imre & Hubbard, Lionel J., 2001. "A mezőgazdasági termékek ágazaton belüli kereskedelme. Magyarország és az Európai Unió között [Intra-industry trade in agricultural products between Hungary and the European Union]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 766-778.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:glecrv:v:38:y:2009:i:1:p:63-76. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RGER20 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.