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Trade, Foreign Firms, and Economic Policy in Indonesian and Thai Manufacturing

  • William E. James

    (Nathan Associates, Inc.)

  • Eric D. Ramstetter

    (International Centre for the Study of East Asian Development and Kyushu University)

This paper first examines the rapid growth and changing composition of manufactured exports in Indonesia and Thailand, highlighting the rapid growth of office and computer machinery and electric machinery, somewhat slower growth of non-electric and transportation machinery, as well as the low growth of previously large exports of textiles apparel. Second, the important contributions of foreign multinational enterprises (MNEs) to export growth in the machinery industries, particularly in electric, office, and computing machinery, are documented. Third, the paper describes trade policies in all these industries in some detail, emphasizing how low protection was a key facilitator of rapid export growth in the MNEs that dominated the electric, office, and computing machinery industry, while high protection reduced incentives to export among MNEs in the transportation machinery industry.

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Paper provided by East-West Center, Economics Study Area in its series Economics Study Area Working Papers with number 78.

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Length: 27 pages
Date of creation: May 2005
Date of revision:
Handle: RePEc:ewc:wpaper:wp78
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  1. Sadayuki Takii & Eric Ramstetter, 2005. "Multinational presence and labour productivity differentials in Indonesian manufacturing, 1975-2001," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 41(2), pages 221-242.
  2. Eric Ramstetter, 2000. "Survey of Recent Developments," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 36(3), pages 3-47.
  3. Eric Ramstetter, 1999. "Trade Propensities and Foreign Ownership Shares in Indonesian Manufacturing," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 35(2), pages 43-66.
  4. Haryo Aswicahyono, 2000. "How Not to Industrialise? Indonesia's Automotive Industry," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 36(1), pages 209-241.
  5. William James & David Ray & Peter Minor, 2003. "Indonesia'S Textiles And Apparel: The Challenges Ahead," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 39(1), pages 93-103.
  6. Takii, Sadayuki, 2004. "Productivity Differentials Between Local and Foreign Plants in Indonesian Manufacturing, 1995," World Development, Elsevier, vol. 32(11), pages 1957-1969, November.
  7. Theodore H. Moran, 2001. "Parental Supervision: The New Paradigm for Foreign Direct Investment and Development," Peterson Institute Press: Policy Analyses in International Economics, Peterson Institute for International Economics, number pa64, 03.
  8. Ito, Keiko, 2004. "Foreign ownership and plant productivity in the Thai automobile industry in 1996 and 1998: a conditional quantile analysis," Journal of Asian Economics, Elsevier, vol. 15(2), pages 321-353, April.
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