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Dragon by the Tail, Dragon by the Head, Bilateralism and Globalism in East Asia

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  • Roland-Holst, David
  • Tarp, Finn
  • Huong, Pham Lan
  • Thanh, Vo Tri

Abstract

In this paper, we examine the bilateral implications of regional and global trade arrangements in the East Asian context. Using a dynamic global CGE model, we examine a variety of trade scenarios, in terms of bilateral relations between China and two of its most populace regional partners, Vietnam and Japan. Given the differences between the latter two economies, it might be reasonable to expect divergence in the bilateral outcomes. Our findings indicate that differences in initial conditions can indeed have a significant impact on bilateral adjustments, and that these can be adverse for some partners in the absence of policies that promote trade complementarity. By the latter we mean bilateral import and export patterns where the aggregate grows faster for each country than their total trade, but which help sustain bilateral balance of payments equilibrium.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 29423.

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Date of creation: 2003
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Handle: RePEc:pra:mprapa:29423

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Keywords: Dragon; Head; Bilateralism; Globalism;

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References

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  1. Hiro Lee & David Roland-Holst, 1994. "Trade Liberalization and Employment Linkages in the Pacific Basin," OECD Development Centre Working Papers 94, OECD Publishing.
  2. Sébastien Dessus & Kiichiro Fukasaku & Raed Safadi, 2001. "Multilateral Tariff Liberalisation and the Developing Countries," OECD Development Centre Policy Briefs, OECD Publishing 18, OECD Publishing.
  3. Lluch, Constantino, 1973. "The extended linear expenditure system," European Economic Review, Elsevier, Elsevier, vol. 4(1), pages 21-32, April.
  4. C. Fred Bergsten & C. Randall Henning, 1996. "Global Economic Leadership and the Group of Seven," Peterson Institute Press: All Books, Peterson Institute for International Economics, Peterson Institute for International Economics, number 45, July.
  5. Bhagwati, Jagdish & Greenaway, David & Panagariya, Arvind, 1998. "Trading Preferentially: Theory and Policy," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 108(449), pages 1128-48, July.
  6. Rutherford, Thomas F. & Tarr, David G., 2002. "Trade liberalization, product variety and growth in a small open economy: a quantitative assessment," Journal of International Economics, Elsevier, Elsevier, vol. 56(2), pages 247-272, March.
  7. Don Fullerton, 1980. "Transition Losses of Partially Mobile Industry-Specific Capital," NBER Working Papers 0520, National Bureau of Economic Research, Inc.
  8. Martin, W. & Winters, L.A., 1995. "The Uruguay Round and the Developing Countries," World Bank - Discussion Papers, World Bank 307, World Bank.
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  10. Shujiro Urata & Hiroki Kawai, 2000. "Intrafirm Technology Transfer by Japanese Manufacturing Firms in Asia," NBER Chapters, in: The Role of Foreign Direct Investment in East Asian Economic Development, NBER-EASE Volume 9, pages 49-77 National Bureau of Economic Research, Inc.
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Cited by:
  1. d’Artis Kancs, 2009. "Structural Estimation of Variety Gains from Trade Integration in Asia," Working Papers, International Network for Economic Research - INFER 2009.7, International Network for Economic Research - INFER.

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