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Impact of Production Linkages on Industrial Upgrading in ASEAN, the People’s Republic of China, and India : Organizational Evidence of a Global Supply Chain

Author

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  • Tomohiro Machikita

    (Asian Development Bank Institute (ADBI))

  • Yasushi Ueki

Abstract

This paper presents a simple model of industrial upgrading as a result of backward and forward information linkages between upstream and downstream relations. It also serves as an empirical investigation of the impact of mutual knowledge exchange on the knowledge production function using data on firms' self-reported customers and suppliers. Evidence from interconnected firms in Indonesia, Thailand, Philippines, and Viet Nam suggests that there are strong spillover effects between downstream and upstream firms in terms of international standard certification. The degree of product and process innovation is quite diverse across manufacturing firms within a local supply chain and within a global supply chain. Firms are likely to achieve product innovation if they have customers in foreign countries. Customers in Japan and the People's Republic of China play an important product innovation role for firms in Association of Southeast Asian Nations (ASEAN) economies, and customers in the United States or Europe play an important industrial upgrading role in connecting ASEAN firms with the global market.

Suggested Citation

  • Tomohiro Machikita & Yasushi Ueki, 2012. "Impact of Production Linkages on Industrial Upgrading in ASEAN, the People’s Republic of China, and India : Organizational Evidence of a Global Supply Chain," Trade Working Papers 23380, East Asian Bureau of Economic Research.
  • Handle: RePEc:eab:tradew:23380
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    References listed on IDEAS

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    Cited by:

    1. repec:ilo:ilowps:486388 is not listed on IDEAS
    2. Sato, Hitoshi., 2014. "How can ASEAN and Japan mutually benefit from ASEAN economic integration?," ILO Working Papers 994863883402676, International Labour Organization.

    More about this item

    Keywords

    production linkages; industrial upgrading; ASEAN; PRC; India; global supply chains; upstream and downstream relations; backward and forward linkages; product and process innovation;

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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