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Horizontal And Vertical Intra-Industry Trade In The U.S. Food Processing Industry

Author

Listed:
  • Sun, Changyou
  • Koo, Won W.

Abstract

Intra-industry trade (IIT) in the U.S. food processing industry is evaluated in this study. The IIT index is disentangled into horizontal and vertical components and evaluated at 6-digit HTS product levels. The degree of IIT varies across different trading partners and sub-industries, and, for the U.S. food processing industry as a whole, it has been steadily increasing since 1989. Most of the IIT in the U.S. food processing industry is vertical in nature. However, horizontal IIT has been increasing faster than vertical IIT. The determinants of horizontal and vertical IIT are examined in a multiple-industry and multiple-country model. Industry characteristics show more significant effects on IIT than country characteristics. Product differentiation, market structure, and scale economies are all relevant in explaining the variation of IIT.

Suggested Citation

  • Sun, Changyou & Koo, Won W., 2002. "Horizontal And Vertical Intra-Industry Trade In The U.S. Food Processing Industry," Agribusiness & Applied Economics Report 23629, North Dakota State University, Department of Agribusiness and Applied Economics.
  • Handle: RePEc:ags:nddaae:23629
    DOI: 10.22004/ag.econ.23629
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    Cited by:

    1. Mark, VANCAUTEREN & Bruno, HENRY DE FRAHAN, 2004. "Harmonization of Food Regulations and Trade in the Single Market : Evidence from Disaggregated Data," LIDAM Discussion Papers IRES 2004021, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    2. Imre Fertö, 2005. "Vertically Differentiated Trade and Differences in Factor Endowment: The Case of Agri‐Food Products between Hungary and the EU," Journal of Agricultural Economics, Wiley Blackwell, vol. 56(1), pages 117-134, March.

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