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Geographical simulation analysis for logistics enhancement in Asia

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  • Kumagai, Satoru
  • Hayakawa, Kazunobu
  • Isono, Ikumo
  • Keola, Souknilanh
  • Tsubota, Kenmei

Abstract

This paper presents a simulation of the reduction of several components in trade cost for Asia and examines its impact on the economy. Our simulation model based on the new economic geography embraces seven sectors, including manufacturing and non-manufacturing sectors, and 1,715 regions in 18 countries/economies in Asia, in addition to the two economies of the US and the European Union. The geographical course of transactions among regions is modeled as determined based on firms’ modal choice. The model also includes estimates of some border cost measures such as tariff rates, non-tariff barriers, other border clearance costs, transshipment costs and so on. Our simulation analysis for Asia includes several scenarios involving the improvement/development of routes and the reduction of the above-mentioned border cost. We have shown that the contribution of physical and non-physical infrastructure improvements conducted together is larger than the sum of the contribution by each when conducted independently.

Suggested Citation

  • Kumagai, Satoru & Hayakawa, Kazunobu & Isono, Ikumo & Keola, Souknilanh & Tsubota, Kenmei, 2012. "Geographical simulation analysis for logistics enhancement in Asia," IDE Discussion Papers 369, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper369
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    References listed on IDEAS

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    Cited by:

    1. Hidetoshi Nishimura & Fukunari Kimura & Masahito Ambashi & Souknilanh Keola, . "Lao PDR at the Crossroads: Industrial Development Strategies 2016–2030," Books, Economic Research Institute for ASEAN and East Asia (ERIA), number 2015-rpr-02 edited by Hidetoshi Nishimura & Fukunari Kimura & Masahito Ambashi & Souknilanh Keola, July.
    2. Ikumo Isono & Satoru Kumagai & Fukunari Kimura, 2012. "Agglomeration And Dispersion In China And Asean: A Geographical Simulation Analysis," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 1(01), pages 1-16.
    3. Fukunari Kimura & Ayako Obashi, 2016. "Production Networks in East Asia: What We Know So Far," ADB Institute Series on Development Economics, in: Ganeshan Wignaraja (ed.), Production Networks and Enterprises in East Asia, edition 1, chapter 0, pages 33-64, Springer.
    4. Chen, Ching-mu & Kumagai, Satoru, 2016. "Economic impacts of the Kra Canal : an application of the automatic calculation of sea distances by a GIS," IDE Discussion Papers 568, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    5. A S M Abdul Quium, 2019. "Transport Corridors for Wider Socio–Economic Development," Sustainability, MDPI, vol. 11(19), pages 1-23, September.
    6. Isono, Ikumo & Ishido, Hikari, 2016. "Service liberalization in Lao PDR," IDE Discussion Papers 559, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    7. Kumagai, Satoru & Gokan Toshitaka & Keola, Souknilanh, 2018. "Economic impacts of economic corridors in Mongolia : an application of IDE-GSM," IDE Discussion Papers 701, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    8. Peter Morgan & Michael G. Plummer & Ganeshan Wignaraja & Fan Zhai, 2015. "Economic Implications of Deeper South Asian–Southeast Asian Integration: A CGE Approach," Asian Economic Papers, MIT Press, vol. 14(3), pages 63-81, Fall.
    9. Tadateru Hayashi & Satoru Kumagai & Sanchita Basu Das & Manbar Singh Khadka & Ikumo Isono & Souknilanh Keola & Kenmei Tsubota & Kazunobu Hayakawa, 2023. "Analysis of the Economic Impact of Improved Connectivity in Nepal," Journal of Asian Economic Integration, , vol. 5(2), pages 145-166, September.
    10. Ikumo Isono & Satoru Kumagai, 2023. "ASEAN's Role in the Threat of Global Economic Decoupling: Implications from Geographical Simulation Analysis," Working Papers PB-2022-10, Economic Research Institute for ASEAN and East Asia (ERIA).
    11. Toshihiro KUDO & Satoru KUMAGAI & So UMEZAKI, 2013. "Making Myanmar the Star Growth Performer in ASEAN in the Next Decade: A Proposal of Five Growth Strategies," Working Papers DP-2013-19, Economic Research Institute for ASEAN and East Asia (ERIA).
    12. Ikumo Isono & Satoru Kumagai, 2013. "Long-run Economic Impacts of Thai Flooding: Geographical Simulation Analysis," Working Papers DP-2013-08, Economic Research Institute for ASEAN and East Asia (ERIA).
    13. Satoru Kumagai & Toshitaka Gokan & Kenmei Tsubota & Ikumo Isono & Kazunobu Hayakawa, 2021. "Economic Impacts of the US–China Trade War on the Asian Economy: An Applied Analysis of IDE-GSM," Journal of Asian Economic Integration, , vol. 3(2), pages 127-143, September.
    14. Yoshikazu Kobayashi & Han Phoumin, 2019. "Cross-border Transport Facilitation in Inland ASEAN and the ASEAN Economic Community," Books, Economic Research Institute for ASEAN and East Asia (ERIA), number 2017-rpr-18 edited by Yoshikazu Kobayashi & Han Phoumin, July.
    15. Kumagai, Satoru & Isono, Ikumo & Hayakawa, Kazunobu, 2018. "Economic impacts of high-speed rail between Kuala Lumpur and Singapore : an application of IDE-GSM," IDE Discussion Papers 700, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    16. Ikumo Isono & Satoru Kumagai, 2016. "Economic Impacts of Improved Connectivity for ASEAN: An Application of the Geographical Simulation Model," Asian Economic Policy Review, Japan Center for Economic Research, vol. 11(2), pages 290-306, July.
    17. Isono, Ikumo & Kumagai, Satoru, 2017. "Geographical simulation analysis of the development of Thilawa and Myanmar," IDE Discussion Papers 639, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    18. Shahrokhi Shahraki, Hamed & Bachmann, Chris, 2019. "Integrating a Computable General Equilibrium model with empirically calibrated transportation models for border crossing investment analysis," Research in Transportation Economics, Elsevier, vol. 78(C).
    19. Kudo, Toshihiro & Kumagai, Satoru & Umezaki, So, 2013. "Five growth strategies for Myanmar : re-engagement with the global economy," IDE Discussion Papers 427, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    20. Kudo, Toshihiro & Kumagai, Satoru, 2012. "Two-polar growth strategy in Myanmar : seeking "high" and "balanced" development," IDE Discussion Papers 371, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    21. Keola, Souknilanh & Kumagai, Satoru, 2016. "Measuring population mobility speed from space," IDE Discussion Papers 574, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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    More about this item

    Keywords

    Asia; Transportation; Distribution; Costs; International trade; Geographical simulation; New economic geography; Trade cost;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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