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Foreign Financial Services Adoption in Manufacturing by Asian Economies: New Index from the Global Value Chain Perspective

Author

Listed:
  • Weikang Zhang

    (Institute of State Goverance, Shandong University, P. R. China)

  • Isabel Kit-Ming Yan

    (��Department of Economics and Finance, City University of Hong Kong, 83 Tat Chee Ave, Hong Kong, P. R. China)

  • Yin-Wong Cheung

    (��Department of Economics, University of California, Santa Cruz, California, USA)

Abstract

In this paper, we employ the input–output framework and recent global value chain (GVC) results to construct the index of foreign financial services adoption in manufacturing (FFSAM) that captures the role of foreign financial services in facilitating domestic manufacturing production. The FFSAM index shows that foreign financial services adoption by Asian economies has rapidly caught up with the Western world between 2007 and 2017. Asian economies tend to deploy more foreign financial services from high-income economies than low-income economies, and in high-technology manufacturing industries than low-technology manufacturing industries. Manufacturing industries that produce for domestic consumption and for exports tend to attract different groups of financial servicification providers. It is found that the FFSAM index is affected by the GVC position, financial institution factors, and financial market characteristics.

Suggested Citation

  • Weikang Zhang & Isabel Kit-Ming Yan & Yin-Wong Cheung, 2022. "Foreign Financial Services Adoption in Manufacturing by Asian Economies: New Index from the Global Value Chain Perspective," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 13(01), pages 1-32, February.
    • Handle: RePEc:wsi:jicepx:v:13:y:2022:i:01:n:s179399332250003x
    DOI: 10.1142/S179399332250003X
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    More about this item

    Keywords

    Cross-border financial services; financial servicification of manufacturing; global value chain; Asian economies;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F30 - International Economics - - International Finance - - - General

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