The Internationalization of Small and Medium Enterprises in Regional and Global Value Chains
AbstractProduction networks and the regional division of labor have been established in East Asia resulting in massive vertical intra-industry trade in parts and components within the region. This phenomenon is known as cross-border production sharing or the fragmentation of production processes into many stages across different countries. New development strategies claim that participation in international production and distribution networks is the key to accelerating economic development in the era of globalization. This process suggests that vertical input-output linkages between local firms and multinational corporations are the most powerful channels to accelerate technology transfers and spillovers. Given the trends of globalization and economic integration in East Asia, there is significant potential for the small and medium enterprise (SME) sector to increase its contribution to the region's development through greater participation in global value chains. However, multiple market failures exist with regard to the development of SMEs and local entrepreneurship. These risks can be mitigated by proper policy measures such as strengthening technological and human resource capabilities through better networking and facilitating access to financing for SMEs. Despite many distortions and inefficiencies in implementing regional economic integration schemes in East Asia, there are many cumulative positive effects contributing to the emerging trend internationalization of SMEs in the region. This process can be significantly strengthened by creating a positive business environment through the standardization of products and services, rules and regulations, and a seamless market infrastructure in the region.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Asian Development Bank Institute in its series ADBI Working Papers with number 231.
Length: 26 pages
Date of creation: 29 Jul 2010
Date of revision:
Contact details of provider:
Postal: Kasumigaseki Building 8F, 3-2-5, Kasumigaseki, Chiyoda-ku,, Tokyo 100-6008, Japan
Fax: (81-3) 3593-5571
Web page: http://www.adbi.org/
More information through EDIRC
internationalization SMEs; regional development policies; regional market failure;
Other versions of this item:
- Hank Lim & Fukunari Kimura, 2010. "The Internationalization of Small and Medium Enterprises in Regional and Global Value Chains," Working Papers id:3113, eSocialSciences.
- Hank Lim & Fukunari Kimura, 2010. "The Internationalization of Small and Medium Enterprises in Regional and Global Value Chains," Microeconomics Working Papers 22812, East Asian Bureau of Economic Research.
- D20 - Microeconomics - - Production and Organizations - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-08-06 (All new papers)
- NEP-CSE-2010-08-06 (Economics of Strategic Management)
- NEP-INT-2010-08-06 (International Trade)
- NEP-SBM-2010-08-06 (Small Business Management)
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.:
- Giuliani, Elisa & Pietrobelli, Carlo & Rabellotti, Roberta, 2005.
"Upgrading in Global Value Chains: Lessons from Latin American Clusters,"
Elsevier, vol. 33(4), pages 549-573, April.
- Elisa Giuliani & Carlo Pietrobelli & Roberta Rabellotti, 2004. "Upgrading in global value chains: lessons from latin american clusters," Working Papers 72, SEMEQ Department - Faculty of Economics - University of Eastern Piedmont.
- Kimura, Fukunari & Ando, Mitsuyo, 2005. "Two-dimensional fragmentation in East Asia: Conceptual framework and empirics," International Review of Economics & Finance, Elsevier, vol. 14(3), pages 317-348.
- Fukunari KIMURA, 2006. "International Production and Distribution Networks in East Asia: Eighteen Facts, Mechanics, and Policy Implications," Asian Economic Policy Review, Japan Center for Economic Research, vol. 1(2), pages 326-344.
- Jan Wengel & Edgard Rodriguez, 2006. "SME Export Performance in Indonesia After the Crisis," Small Business Economics, Springer, vol. 26(1), pages 25-37, 02.
- Jan Johanson & Jan-Erik Vahlne, 1977. "The Internationalization Process of the Firm—A Model of Knowledge Development and Increasing Foreign Market Commitments," Journal of International Business Studies, Palgrave Macmillan, vol. 8(1), pages 23-32, March.
- Shigeaki SHIRAISHI, 2006. "Comment on "International Production and Distribution Networks in East Asia: Eighteen Facts, Mechanics, and Policy Implications"," Asian Economic Policy Review, Japan Center for Economic Research, vol. 1(2), pages 347-348.
- Hal HILL, 2006. "Comment on "International Production and Distribution Networks in East Asia: Eighteen Facts, Mechanics, and Policy Implications"," Asian Economic Policy Review, Japan Center for Economic Research, vol. 1(2), pages 345-346.
- Wignaraja, Ganeshan, 2012. "Engaging Small and Medium Enterprises in Production Networks: Firm-level Analysis of Five ASEAN Economies," ADBI Working Papers 361, Asian Development Bank Institute.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Robert Hugh Davis).
If references are entirely missing, you can add them using this form.