Leitão, Nuno Carlos (2012): Globalization and United States’ Intra-Industry Trade.
Download (186kB) | Preview
The recent trend of globalization has given rise to a new paradigm in international economics, i.e. the simultaneous exports and imports of a product within country or a particular industry called intra-industry trade (IIT) or two-way trade. This study examines country-levels determinants of intra-industry trade, in U.S. trade. The manuscript applies a static and dynamic panel data approach. In contrast to previous studies, this paper used a dynamic panel data to solve the problems of serial correlation and endogeneity. The results indicate that IIT occurs more frequently among countries that are similar in terms of factor endowments. We also introduce economic dimension; this proxy confirms the positive effect of IIT. Our results also confirm the hypothesis that trade increases if the transportation costs decrease.
|Item Type:||MPRA Paper|
|Original Title:||Globalization and United States’ Intra-Industry Trade|
|English Title:||Globalization and United States’ Intra-Industry Trade|
|Keywords:||Globalization, Intra-industry trade, Panel data, United States|
|Subjects:||C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C20 - General
F - International Economics > F1 - Trade > F12 - Models of Trade with Imperfect Competition and Scale Economies ; Fragmentation
|Depositing User:||Nuno Carlos Leitão|
|Date Deposited:||02. Jul 2012 05:47|
|Last Modified:||29. Sep 2015 10:25|
Abd El Rahman, K.(1991),Firm’s Competitive and national comparative advantages as join determinants of trade composition, Weltwirtschaftliches Archiv, 127 (1): 83 97.
Arellano, M. and Bond, S. (1991), Some Test of Specification for Panel Data: Monte Carlo Evidence and An Application to Employment Equations, Review of Economic Studies, 58: 277-297.
Arellano, M. and Bover, O. (1995), Another Look at Instrumental Variable Estimation of Error- Components Models’, Journal of Econometrics, 68: 29-51.
Balassa, B. (1966), Tariff Reductions and Trade in manufactures among the industrial countries, American Economic Review, 56, 466 473.
Balassa,B.,andBauwens,L. (1987), Intra Industry Specialization in a Multi Country and Multi Industry Framework, The Economic Journal, 97( 388): 923 939.
Bhalla A, Bhalla, P (1997), Regional Blocks: Building Blocks or Stumbling Blocks?, London: Macmillan.
Blundell, R and Bond, S. (1998), Initial Conditions and Moment Restrictions in Dynamic Panel Data Models, Journal of Econometrics Review, 87: 115-143.
Blundell, R and Bond, S. (2000), GMM Estimation with Persistent Panel Data: An Application to Production Functions, Econometrics Review, 19: 321-340.
Brander, J. and Krugman, P. (1983), A reciprocal dumping model of international trade, Journal of International Economics, 15, 3(4): 313 321.
Clark D. (2006), Country and industry-level determinants of vertical specialization based trade, International Economic Journal, 20 (2): 211–225.
Chemsripong, S Lee, and J. Agbola, F. (2005), Intra-industry trade in manufactures between Thailand and other Asia Pacific Economic Cooperation (APEC) countries for 1980, Applied Econometrics and International Development, (5) 4: 63-82.
Dunning, J. (1993), Globalisation: The Challenge for National Economic Regimes, Dublin: Economic and Social Research Council.
Eaton, J. and Kierzkowski, H. (1984), Oligopolistic competition, product variety, and international trade, in KIERZKOWSKI, H. (eds.), Monopolistic Competition and International Trade. New York [etc.] : Oxford University Press.
Falvey, R. and Kierzkowski, H. (1987), Product quality, intra industry trade and imperfect competition, in KIERZKOWSKI, H.(eds.), Protection and Competition in International Trade. New York [etc.] : Blackwell.
Faustino H. and Leitão N. C. (2007), Intra-Industry Trade: A Static and Dynamic Panel Data Analysis, International Advances in Economic Research , 13, (3): 313-333.
Ferto, I. , Soós, A. (2008), Treating Trade Statistics Inaccuracies: The Case of Intra-industry Trade, Applied Economics Leters, 1-6.
Gray,H. (1998), Intra - Industry Trade : An Untidy Phenomenon, Weltwirtschaftliches Archiv 124: 211—229.
Greenway, D., Hine, R. and , Milner, C. (1994), Country specific factors and the pattern of horizontal and vertical intra industry trade in UK, Review of World Economic, 130 (1): 77 100.
Grubel, H. and Lloyd, P. (1975), Intra industry trade: the theory and measurement of international trade in different products, London: Macmillan.
Helpman, E. (1981), International trade in the presence of product differentiation, economies of scales and monopolistic competition: a Chamberlin Heckscher Ohlin Approach, Journal of Political Economy, 92: 451 71.
Helpman, E., Krugman, P. (1985), Market Structure and Foreign Trade: Increasing Returns, Imperfect Competition and the International Economy,1st ed; London : MIT Press.
Higgott, R.A. (2000), Back from the Brink: The Theory and Practice of Globalisation at Century’s End, in Mely C. Anthony and Jawhar Hassan (eds) Beyond the Crisis: Challenges and Opportunities, Kuala Lumpur: Institute of Strategic and International Studies, 67-91
Hummels, D. and Levinsohn, J. (1995), Monopolistic competition and international trade: reconsidering the evidence, Quarterly Journal of Economics, 110 (3): 799 836.
Jones, R. W., & Kierzkowski, H. (1990), The Role of Services in Production and International Trade: A Theoretical Framework. In Jones Ronald & Krueger Anne (Eds.), The Political Economy of International Trade , 31–48. Blackwell: Oxford
Kandogan, Y. (2003), Intra-Industry Trade of Transition Countries: Trends and Determinants. Emerging Markets Review 4,(3): 272-286.
Kimura, F., Takahashi, Y., and Hayakawa, K. (2007), Fragmentation and parts and components trade: Comparison between East Asia and Europe. North American Journal of Economics and Finance, 18: 23–40.
Komijani Akbar and Nouri Kyoumars (1999), Globalization of Economy and Its Effects on Iran’s Agriculture, Economy and Management Quarterly, 46: 8-9.
Krugman, P. (1979), Increasing returns, monopolistic competition and international trade , Journal of International Economics, 9 (4), 469 479.
Krugman, P. (1980), Scale economies, product differentiation and the pattern of trade , American Economic Review, 70 (5): 950 959.
Krugman, P. (1981), Intra industry specialization and gains from trade, Journal of Political Economy, 89 (70): 959 973.
Lancaster, K. (1980), Intra industry trade under perfect monopolistic competition , Journal of International Economics, 10 (2): 151 175.
Lee, H and Lee, Y. (1993), Intra-industry trade in manufactures: The case of Korea, Review of World Economics, (129), 159-171.
Leitão N. C. and Faustino, H. (2008), Intra - industry trade in the food processing sector: the Portuguese case, Journal of Global Business and Technology , 4 (1): 49-58.
Leitão, N. C. and Faustino, H. (2009), Intra-industry trade in the automobile components industry: an empirical analysis, Journal of Global Business and Technology, 5 (1): 31-41.
Loertscher, R. and Wolter, F.(1980), Determinants of intra industry trade among countries and across industries, Review of World Economics, 116(2): 280 293.
Makhija M V, Kwangsoo K and Williamson S D (1997), Measuring Globalization of Industries Using a National Industry Approach: Empirical Evidence Across Five Countries and Over Time, Journal of International Business Studies, 28 (4): 679-710.
Ohmae, K. (1995), The End of the Nation State: The Rise of Regional Economies, New York: The Free Press.
Oman, C. (1994), Globalisation and Regionalisation: The Challenge for Developing Countries, Paris: Organisation for Economic Cooperation and Development (OECD).
Petrella, R. (1996) ,Globalisation and Internationalisation: The Dynamics of the Emerging World Order, in Robert Boyer and Daniel Drache (eds) States Against Markets, London: Routledge, 62-83.
Shaked, A. and Sutton, J. (1984), Natural oligopolies and international trade, in KIERZKOWSKI, H. (eds.). Monopolistic competition and international trade. Oxford University Press.
Stone, J. A., and Lee, H. H. (1995), Determinants of Intra-Industry Trade: A Longitudinal, Cross-Country Analysis, Weltwirtschaftliches Archiv 131, 1: 67-85.
Umemoto, M.2005. Development and intra-industry trade between Korea and Japan: The case of automobile parts industry. CITS Working Paper n°2005-03, Centre for International Trade Studies, Yokohama National University.
Wakasugi, R. (2007), Vertical intra-industry trade and economic integration in East Asia, Asian Economic Papers, 6: 26-45.
Windmeiger, F. (2005), A finite sample correction for the variance of linear efficient two-step GMM estimators, Journal of Econometrics, 26: 25-51.
World Bank (2002) World Economic Report.