Production Fragmentation and Trade Integration: East Asia in a Global Context

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Production Fragmentation and Trade Integration: East Asia in a Global Context

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Prema-chandra Athukorala ()
Nobuaki Yamashita ()

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Prema-chandra Athukorala

Abstract

This paper examines the implications of international production fragmentation for analysing global and regional trade patterns, with special emphasis on countries in East Asia. It is found that, while 'fragmentation trade' has generally grown faster than total world manufacturing trade, the degree of dependence of East Asia on this new form of international specialisation is proportionately larger compared to North America and Europe. International production fragmentation has certainly played a pivotal role in continuing dynamism of the East Asian economies and increasing intra-regional economic interdependence. There is, however, no evidence to suggest that this new form of international exchange has contributed to lessoning the regions dependence on the global economy. On the contrary, growth dynamism based on vertical specialisation depends inexorably on extra-regional trade in final good, and this dependence has in fact increased over the years.

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Paper provided by Australian National University, Economics RSPAS in its series Departmental Working Papers with number 2005-07.

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Length: 48 pages
Date of creation: 2005
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Handle: RePEc:pas:papers:2005-07

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Article
- Athukorala, Prema-chandra & Yamashita, Nobuaki, 2006. "Production fragmentation and trade integration: East Asia in a global context," The North American Journal of Economics and Finance, Elsevier, vol. 17(3), pages 233-256, December. [Downloadable!] (restricted)

Find related papers by JEL classification:
F15 - International Economics - - Trade - - - Economic Integration
F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
O53 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

This paper has been announced in the following NEP Reports:

NEP-ALL-2005-07-25 (All new papers)
NEP-INT-2005-07-25 (International Trade)
NEP-SEA-2005-07-25 (South East Asia)

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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Other versions:
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repec:rus:hseeco:123689 is not listed on IDEAS
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Other versions:
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

Haddad, Mona, 2007. "Trade integration in East Asia : the Role of China and production networks," Policy Research Working Paper Series 4160, The World Bank. [Downloadable!]
Götz Zeddies, 2007. "Determinants of International Fragmentation of Production in the European Union," IWH Discussion Papers 15-07, Halle Institute for Economic Research. [Downloadable!]
Rahardja, Sjamsu, 2007. "Big dragon, little dragons : China ' s challenge to the machinery exports of southeast Asia," Policy Research Working Paper Series 4297, The World Bank. [Downloadable!]

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