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Trade and Development in Vietnam: Exploring Investment Linkages

Author

Listed:
  • Abott, Philip
  • Boys, Kathryn
  • Tarp, Finn
  • Huong, Pham Lan

Abstract

This paper presents and uses a new, stylized single country dynamic CGE model to explore the trade-development linkages in Vietnam. Application of this framework involves addressing three basic questions: 1. Does a model that properly determines capacity additions and more fully captures macroeconomic accounting and growth dynamics predict trade levels in a satisfactory manner? 2. Are those capacity additions determined by trade liberalization, and if so, which aspects of trade liberalization? 3. Under this framework what are expected impacts of trade liberalization initiatives, such as past bilateral trade agreements and recent WTO accession, taking into account their potential effect on incentives to invest via both tariff changes and institutional reforms? We also explore the role of the state in determining investment patterns, since the government of Vietnam has played a crucial role in setting both the aggregate level and sectoral pattern of investment in the past. But recently there has been a recovery of foreign investment as well as an upsurge of investment by the domestic private sector. Moreover, Vietnam’s WTO accession agreement was as much about incentives to FDI as it was about tariff concessions, and it spurred ongoing institutional reforms that impact the investment climate.

Suggested Citation

  • Abott, Philip & Boys, Kathryn & Tarp, Finn & Huong, Pham Lan, 2008. "Trade and Development in Vietnam: Exploring Investment Linkages," MPRA Paper 29382, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:29382
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    References listed on IDEAS

    as
    1. Baxter, Marianne & King, Robert G, 1993. "Fiscal Policy in General Equilibrium," American Economic Review, American Economic Association, vol. 83(3), pages 315-334, June.
    2. International Monetary Fund, 2007. "Vietnam: Statistical Appendix," IMF Staff Country Reports 2007/386, International Monetary Fund.
    3. International Monetary Fund, 2006. "Vietnam; Statistical Appendix," IMF Staff Country Reports 06/423, International Monetary Fund.
    4. International Monetary Fund, 2006. "Vietnam: Statistical Appendix," IMF Staff Country Reports 2006/423, International Monetary Fund.
    5. International Monetary Fund, 2006. "Vietnam: Statistical Appendix," IMF Staff Country Reports 2006/052, International Monetary Fund.
    6. International Monetary Fund, 2003. "Vietnam: Statistical Appendix," IMF Staff Country Reports 2003/382, International Monetary Fund.
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    Cited by:

    1. Philip Abbott & Finn Tarp, 2012. "Globalization Crises, Trade And Development In Vietnam," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(01), pages 1-23.
    2. Philip Abbott & Ce Wu & Finn Tarp, 2014. "Transmission of World Prices to the Vietnamese Economy," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 29, pages 624-656.
    3. Pham Van Ha & Hoa Thi Minh Nguyen & Tom Kompas & Tuong Nhu Che & Bui Trinh, 2015. "Rice Production, Trade and the Poor: Regional Effects of Rice Export Policy on Households in Vietnam," Journal of Agricultural Economics, Wiley Blackwell, vol. 66(2), pages 280-307, June.
    4. Abbott, Philip & Wu, Ce & Tarp, Finn, 2011. "Transmission of World Prices to the Domestic Market in Vietnam," MPRA Paper 84611, University Library of Munich, Germany.

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    Keywords

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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