Some new evidence on intra-industry trade and complex FDI in ASEAN countries: a spatial panel approach
This paper examines the interaction on intra-industry trade (IIT) and foreign direct investment (FDI) with special attention to the Association of Southeast Asian Nations (ASEAN). We introduce the 2Ã—3Ã—3 knowledge-capital model, recently proposed by Baltagi et al. (2007) and Uttama and PÃ©ridy (2009). The theoretical implications are suggested, not only how IIT is determined by country characteristics, such as similarity in market size and factor differentials, but also trade costs as well as regional economic integration. Moreover, it also empirically investigates the determinants of aggregated and disaggregated IIT in five ASEAN countries over the period 19952008, concerned with what extent complex FDIs boost IIT. Using spatial panel data model, we find the fact that the empirical results are consistent with the theoretical predictions. Vertical FDI tends to discourage ASEANâ€™s IIT, whereas complex horizontal FDI in neighbours tends to encourage its IIT in ASEAN.
Volume (Year): 4 (2012)
Issue (Month): 1/2 ()
|Contact details of provider:|| Web page: http://www.inderscience.com/browse/index.php?journalID==310|
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.:
- James R. Markusen, 2004.
"Multinational Firms and the Theory of International Trade,"
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262633078.
- Markusen, James R., 2002. "Multinational Firms and the Theory of International Trade," MPRA Paper 8380, University Library of Munich, Germany.
- Wakasugi, R., 1997. "Missing factors of intra-industry trade: Some empirical evidence based on Japan," Japan and the World Economy, Elsevier, vol. 9(3), pages 353-362, August.
- Bernhofen, Daniel M., 1999.
"Intra-industry trade and strategic interaction: Theory and evidence,"
Journal of International Economics,
Elsevier, vol. 47(1), pages 225-244, February.
- Bernhofen, Daniel M., 1998. "Intra-industry trade and strategic interaction: Theory and evidence," Journal of International Economics, Elsevier, vol. 45(1), pages 77-96, June.
- José Manuel Martins Caetano & Aurora Galego, 2006. "In Search for Determinants of Intra-Industry Trade within an Enlarged Europe," Economics Working Papers 2_2006, University of Évora, Department of Economics (Portugal).
- Xing, Yuqing, 2007.
"Foreign direct investment and China's bilateral intra-industry trade with Japan and the US,"
BOFIT Discussion Papers
1/2007, Bank of Finland, Institute for Economies in Transition.
- Xing, Yuqing, 2007. "Foreign direct investment and China's bilateral intra-industry trade with Japan and the US," Journal of Asian Economics, Elsevier, vol. 18(4), pages 685-700, August.
- Sawyer, William C. & Sprinkle, Richard L. & Tochkov, Kiril, 2010. "Patterns and determinants of intra-industry trade in Asia," Journal of Asian Economics, Elsevier, vol. 21(5), pages 485-493, October.
- Shahbaz, Muhammad & Leitão, Nuno Carlos, 2011. "Intra-industry trade: The Pakistan experience," MPRA Paper 28665, University Library of Munich, Germany.
- Hartmut Egger & Peter Egger & Michael Ryan, 2010. "Bilateral and Third-Country Exchange Rate Effects on Multinational Activity," Review of International Economics, Wiley Blackwell, vol. 18(5), pages 1012-1027, November.
- Baltagi, Badi H. & Egger, Peter & Pfaffermayr, Michael, 2007.
"Estimating models of complex FDI: Are there third-country effects?,"
Journal of Econometrics,
Elsevier, vol. 140(1), pages 260-281, September.
- Badi H. Baltagi & Peter Egger & Michael Pfaffermayr, 2005. "Estimating Models of Complex FDI: Are There Third-Country Effects?," Center for Policy Research Working Papers 73, Center for Policy Research, Maxwell School, Syracuse University.
When requesting a correction, please mention this item's handle: RePEc:ids:ijecbr:v:4:y:2012:i:1/2:p:116-131. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Graham Langley)
If references are entirely missing, you can add them using this form.