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Integration and Trade Specialization in East Asia

The 1990s saw East Asia becoming more integrated as trade barriers fell, trade intensity and intra-industry trade increased, and production networks formed. This greater integration has resulted in changing patterns of trade specialization in the region, as different economies adjust. Some economies (especially resource-rich economies) maintain their top trade-specialty products, while others move towards higher-productivity manufacturing goods. Nonetheless, we observe in all East Asian countries in our study a trend towards specializing in products with higher sophistication and technological intensity. Meanwhile, our examination of the product specialization mobility and our empirical analysis suggest no indication of East Asian countries being in a "low-productivity specialization trap" which would disable them from shifting their specialization towards higher-productivity and higher-value goods.

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Paper provided by Centre for Strategic and International Studies, Jakarta, Indonesia in its series CSIS Economics Working Paper Series with number WPE094.

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Date of creation: Mar 2006
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Handle: RePEc:sis:wpecon:wpe094
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  1. Donald R. Davis & Trevor A. Reeve, 2000. "Human capital, unemployment, and relative wages in a global economy," International Finance Discussion Papers 659, Board of Governors of the Federal Reserve System (U.S.).
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  4. Kimura, Fukunari & Ando, Mitsuyo, 2005. "Two-dimensional fragmentation in East Asia: Conceptual framework and empirics," International Review of Economics & Finance, Elsevier, vol. 14(3), pages 317-348.
  5. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," NBER Working Papers 3577, National Bureau of Economic Research, Inc.
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  9. Redding, Stephen, 1999. "Dynamic Comparative Advantage and the Welfare Effects of Trade," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 15-39, January.
  10. Hadi Soesastro, 2003. "Challenges to APEC Trade Policy: The Doha Development Agenda and RTAs/FTAs," CSIS Economics Working Paper Series WPE069, Centre for Strategic and International Studies, Jakarta, Indonesia.
  11. Proudman, J. & Redding, S., 1998. "Evolving Patterns of International Trade," Economics Papers 144, Economics Group, Nuffield College, University of Oxford.
  12. Fukao, Kyoji & Ishido, Hikari & Ito, Keiko, 2003. "Vertical Intra-Industry Trade and Foreign Direct Investment in East Asia," Discussion Paper Series a434, Institute of Economic Research, Hitotsubashi University.
  13. Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
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  16. repec:cup:cbooks:9781107411289 is not listed on IDEAS
  17. Tubagus Feridhanusetyawan, 2005. "Preferential Trade Agreements in the Asia-Pacific Region," IMF Working Papers 05/149, International Monetary Fund.
  18. Michel Beine & Serge Coulombe, 2004. "Economic Integration and Regional Industrial Specialization: Evidence from the Canadian- US FTA Experience," Working Papers 0408E, University of Ottawa, Department of Economics.
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