Article

Intra-Industry Trade: The Theory and Measurement of International Trade in Differentiated Products

Authors:
To read the full-text of this research, you can request a copy directly from the authors.

No full-text available

Request Full-text Paper PDF

To read the full-text of this research,
you can request a copy directly from the authors.

... The phenomenon of intra-industry trade was first observed and empirically studied in the 1960s (Verdoorn, 1960 [15] ; Balassa, 1963Balassa, , 1966; [3,4] and Grubel, 1967) [8] . After the development of the most popular index for the measurement of IIT by Grubel and Lloyd (1975) [9] , there has been an ever increasing flow of empirical studies in intra-industry trade in goods using data from different countries. Scholars have started studying new aspects of IIT and many new models are developed to measure and explain the changing pattern of IIT. ...
... The phenomenon of intra-industry trade was first observed and empirically studied in the 1960s (Verdoorn, 1960 [15] ; Balassa, 1963Balassa, , 1966; [3,4] and Grubel, 1967) [8] . After the development of the most popular index for the measurement of IIT by Grubel and Lloyd (1975) [9] , there has been an ever increasing flow of empirical studies in intra-industry trade in goods using data from different countries. Scholars have started studying new aspects of IIT and many new models are developed to measure and explain the changing pattern of IIT. ...
... The growth in exports and imports of the BRIC countries are assessed by estimating the compound annual growth rates using semi-log trend equation. A number of indices are available for measuring intraindustry trade, but we have used the most widely used and popular one developed by Grubel and Lloyd (1975) [9] for measuring the extent of intra-industry trade in ICT service in BRIC countries. Thus, for the ICT services the IIT index is computed as follows: ...
... The basis of this study depends on the measurement of Intra industry trade. Intra industry trade formula was developed by Grubel and Lloyd (1975). The formula describes the international trade of differentiated products. ...
... Intra-industry trade is expressed as the value of exports of an 'industry' which is exactly matched by the imports of the same industry (Grubel and Lloyd, 1975: ...
... (Total exports + Total imports) / Gross Domestic Product (8) ...
Article
Full-text available
This study is an analysis of the intra industry trade between the United Kingdom and the United States of America in the manufacturing sector. The analysis comprises of the years between 1993 and 2019. The factors influencing the intra industry trade and their impacts are examined. With the help of ARDL approach, cointegration between the variables is tested. According to the results, foreign direct investment, per capita income difference and trade openness are affective in the long run, but in the short run, per capita income difference, GDP difference and trade orientation are affective. Per capita income difference has an impact on the intra industry trade both in the short run and in the long run, demonstrating the Linder’s Theory of Overlapping Demands which proposes that the international trade will be stronger between countries with similar per capita income levels.
... The basis of this study depends on the measurement of Intra industry trade. Intra industry trade formula was developed by Grubel and Lloyd (1975). The formula describes the international trade of differentiated products. ...
... Intra-industry trade is expressed as the value of exports of an 'industry' which is exactly matched by the imports of the same industry (Grubel and Lloyd, 1975: ...
... (Total exports + Total imports) / Gross Domestic Product (8) ...
Article
This study is an analysis of the intra industry trade between the United Kingdom and the United States of America in the manufacturing sector. The analysis comprises of the years between 1993 and 2019. The factors influencing the intra industry trade and their impacts are examined. With the help of ARDL approach, cointegration between the variables is tested. According to the results, foreign direct investment, per capita income difference and trade openness are affective in the long run, but in the short run, per capita income difference, GDP difference and trade orientation are affective. Per capita income difference has an impact on the intra industry trade both in the short run and in the long run, demonstrating the Linder’s Theory of Overlapping Demands which proposes that the international trade will be stronger between countries with similar per capita income levels.
... It includes lengthy debates about market regulation versus deregulation, monopolies versus competition, and who should be responsible for generation, transmission, and distribution of power. Scientific (29) Qualitative methods (29) ...
... It includes lengthy debates about market regulation versus deregulation, monopolies versus competition, and who should be responsible for generation, transmission, and distribution of power. Scientific (29) Qualitative methods (29) ...
... Since the relative efficiency gap is not the same for all goods, trade negotiations strive to delineate how to close these gaps product by product. The modern trade theories, supported by [27][28][29], emphasize increasing returns to scale and internal economies of scale as the trigger for trade. This school of thought identifies market imperfections to be the key determinant beyond factor endowment and technology but still perceives trade as only unidirectional. ...
Article
Full-text available
This paper surveys theory and practice on how a larger and integrated energy market can propel electricity trading through economies of scale. We make a systematic presentation of theories and methods used by various scholars to generate knowledge on integrated electricity markets. We discuss paradigms, concepts, and practices emanating from the complex topic of a unified electricity market with an intent to identify gaps. We conclude that electricity trading in EMI has a propensity to drive both economic integration and sustainable energy access; that crafting ways and means for integrating cross-border systems without sacrificing the local economy could make the idea of EMI more palatable to partner countries; and that adoption of ex ante studies that are non-data oriented could improve the design of upcoming regional electricity markets.
... El comercio intraindustrial (CINTRA) se define como la exportación e importación simultáneas de bienes que pertenecen a una misma industria y ha sido una característica del comercio que se ha generalizado debido a las economías de escala y la diferenciación del producto. Los planteamientos de la teoría clásica -particularmente las ventajas comparativas de Ricardo y la propuesta de Heckscher-Ohlin-Samuelson-concluyeron que entre dos naciones el comercio siempre es de tipo interindustrial, es decir de bienes que pertenecen a distintas industrias (Grubel y Lloyd 1975;Loertscher y Wolter 1980). Sin embargo, desde al menos la década de los 70, la esencia del nuevo patrón del comercio está en contraposición a los postulados clásicos, ya que los flujos comerciales no han sido únicamente entre distintas industrias, sino mayormente entre industrias iguales, dando lugar al comercio intraindustrial. ...
... Tres son los elementos teóricos principales en la explicación del CINTRA, los dos primeros son supuestos de competencia imperfecta y el tercero una combinación de los dos elementos anteriores: 1) En primer lugar, la competencia monopolística, en donde cada firma puede diferenciar su producto respecto a sus competidores y las firmas toman los precios de sus rivales como dados. (Chamberlin 1956); 2) las economías de escala, asociadas a la caída de los costos medios debido a un incremento de la producción, es decir rendimientos crecientes a escala (Lancaster 1980;Krugman 1981) y las cuales no sólo dependen del tamaño de las plantas, sino también de la extensión del proceso productivo, el tamaño de las firmas (Krugman y Obstfeld 1994) y la organización de la producción al interior de la planta (Grubel y Lloyd 1975); y 3) la diferenciación del producto, que surge a partir de una cualidad del producto que lo haga distinto a los demás e incite a los consumidores a preferirlo sobre los otros (Chamberlin 1956). La diferenciación del producto es una de las variables más complejas de analizar, ya que combina los dos elementos anteriores y además existen diversos modelos que explican la existencia de CINTRA con base en el origen de diferenciación. ...
... Actualmente la medida del grado de CINTRA más utilizada es el índice propuesto por Grubel y Lloyd (Grubel y Lloyd 1975), el cual se estima para un bien o industria individual y se expresa como la razón entre la balanza comercial en valores absolutos y el comercio total de dicho bien. ...
... El comercio intraindustrial (CINTRA) se define como la exportación e importación simultáneas de bienes que pertenecen a una misma industria y ha sido una característica del comercio que se ha generalizado debido a las economías de escala y la diferenciación del producto. Los planteamientos de la teoría clásica -particularmente las ventajas comparativas de Ricardo y la propuesta de Heckscher-Ohlin-Samuelson-concluyeron que entre dos naciones el comercio siempre es de tipo interindustrial, es decir de bienes que pertenecen a distintas industrias (Grubel y Lloyd 1975;Loertscher y Wolter 1980). Sin embargo, desde al menos la década de los 70, la esencia del nuevo patrón del comercio está en contraposición a los postulados clásicos, ya que los flujos comerciales no han sido únicamente entre distintas industrias, sino mayormente entre industrias iguales, dando lugar al comercio intraindustrial. ...
... Tres son los elementos teóricos principales en la explicación del CINTRA, los dos primeros son supuestos de competencia imperfecta y el tercero una combinación de los dos elementos anteriores: 1) En primer lugar, la competencia monopolística, en donde cada firma puede diferenciar su producto respecto a sus competidores y las firmas toman los precios de sus rivales como dados. (Chamberlin 1956); 2) las economías de escala, asociadas a la caída de los costos medios debido a un incremento de la producción, es decir rendimientos crecientes a escala (Lancaster 1980;Krugman 1981) y las cuales no sólo dependen del tamaño de las plantas, sino también de la extensión del proceso productivo, el tamaño de las firmas (Krugman y Obstfeld 1994) y la organización de la producción al interior de la planta (Grubel y Lloyd 1975); y 3) la diferenciación del producto, que surge a partir de una cualidad del producto que lo haga distinto a los demás e incite a los consumidores a preferirlo sobre los otros (Chamberlin 1956). La diferenciación del producto es una de las variables más complejas de analizar, ya que combina los dos elementos anteriores y además existen diversos modelos que explican la existencia de CINTRA con base en el origen de diferenciación. ...
... Actualmente la medida del grado de CINTRA más utilizada es el índice propuesto por Grubel y Lloyd (Grubel y Lloyd 1975), el cual se estima para un bien o industria individual y se expresa como la razón entre la balanza comercial en valores absolutos y el comercio total de dicho bien. ...
Chapter
Full-text available
Presentamos una de las dimensiones de la relación bilateral sino-es�tadounidense: la competencia en torno a la construcción de alianzas diplomático-comerciales con los gobiernos de los países pertene�cientes a Asia del Pacífico. Destacamos tres aspectos: primero, la voluntad del gobierno estadounidense para recuperar el terreno po�lítico en esa región; segundo, la influencia de la reorientación de la política exterior estadounidense sobre la dinámica de los procesos de integración en la zona, en general, y, en particular, del acercamien�to entre los gobiernos de la República Popular China, de la República de Corea y de Japón; tercero, la recuperación de la Trans-Pacific Partnership Initiative (TPP) por la administración Obama, como una respuesta a la consolidación en la región asiática del Pacífico; como contrapunto, consideramos las posibilidades de un acuerdo de comercio preferencial (ACP) entre los gobiernos de China, Japón y Corea como respuesta asiática a Estados Unidos.
... In addition, as multinational enterprises establish subsidiaries in multiple countries and exchange goods and services with the parent firm, IIT is frequently accompanied by foreign direct investment (FDI), which indicates the importance of monitoring changes in trade patterns and trade structure. The basis for IIT trade theory can be found in the work of Verdoorn (1960) and Balassa (1965), but the most important theoretical and methodological contribution to the measurement of IIT was made by Grubel and Lloyd (1971;1975). The authors note that trading partners do not exchange identical products, but different variations of that product. ...
... The authors note that trading partners do not exchange identical products, but different variations of that product. To measure IIT, Grubel and Lloyd (1975) developed the Grubel-Lloyd index, which measures the size of IIT in an industry. Although the classic Grubel-Lloyd index has its drawbacks, it is still extensively used in the empirical literature on IIT. ...
... Although over the years a multitude of different formulas for measuring IIT was developed, we choose original Grubel & Lloyd (1975) version, to have comparable results with the bulk of research results in this research field. So, we calculate IIT for trade between country i and j with good k in time t using the following formula: ...
Article
Full-text available
This paper investigates the impact of regional trade agreements (RTAs) on the development of intra-industry trade (IIT) for eight Central and Eastern Europe countries (CEE) from 1997 to 2019. The aim of the paper is to compare and explain the possible heterogeneous impact of different RTAs on IIT across countries while controlling for differences in development levels between economic integration member states. Our analysis is based on country-product level data obtained from UN Comtrade. The main hypothesis of the paper is that the CEFTA and EU integration agreements have a highly positive effect on IIT in comparison with other RTAs. However, the scope of the impact varies across countries, primarily depending on the economic development asymmetries that are in this paper proxied by the GDP per capita. We developed and estimated an augmented structural gravity model using Pseudo-Poisson Maximum Likelihood Estimator. The main contribution of our paper is the inclusion of the FTA-economic development gap interaction term, which enabled us to enrich the empirical findings of the research. Our results show that the main hypothesis holds, but also that an increase in economic asymmetries between integration members negatively affects IIT, thus indicating potentially increasing trade adjustment costs for new member states of an integration. These results go in favor of EU pre-integration and post-integration policies that have the goal of diminishing the economic development gap between future and present integration members.
... The comprehensive research about intra-industry trade during the last decade was started by Grubel In a non-formal way, Grubel k Lloyd (1975) give some explanations why intra-industry trade arises. They point out that product differentiation plays an important role. ...
... The most common measure of intra-industry trade is Grubel and Lloyd's index (Grubel & Lloyd, 1975). There are some forerunners, but today Grubel and Lloyd's index is the standard measure of the size of intra-industry trade.6 ...
... (2.7) IITit » Grubel & Lloyd (1975), Lipsey (1976), Pomfret (1979), and Rodgers (1987). that level of aggregation. ...
Thesis
Full-text available
The purpose of this book is to explain why intra-industry trade - simultaneous export and import of products produced within the same industry - arises and to find out what factors influence its size. The size of intra-industry trade is measured by using Grubel and Lloyd's index, i.e., the share of intra-industry trade in total trade (IIT). The book has four main chapters. The first is descriptive and gives some stylized facts about intra-industry trade in the Swedish manufacturing trade. The second is theoretical and derives implications for IIT from different trade models. The third discusses how factors influencing IIT can be tested empirically, and the fourth tests these hypotheses on Swedish manufacturing trade. The empirical tests are carried out as a cross-industry and cross-country analysis as well as a study over time. The conclusions are that a traditional factor proportions model seems neither theoretically nor empirically to explain IIT. However, a relaxation of the assumption of homogenous products in the industry gives rise to several implications for IIT. Industry characteristics such as an industry's factor intensity and the degree of product differentiation play important roles. The more extreme an industry is about factor intensity, i.e., if an industry is very capital or very labor-intensive, the smaller IIT is in that industry. The more differentiated the products - the less the elasticity of substitution in demand between different products in an industry - the larger the IIT. To test the latter, a new measure of product differentiation closely related to the concept in the theoretical model is developed. Furthermore, similarity in relative factor endowments in the trading countries and transaction costs - tariffs and transport costs - influence IIT. The more similar the relative factor endowments, the larger the IIT. The less the transaction costs, the greater the IIT.
... Evidence shows that a significant part of the development in world trade, especially among developed countries, is of an intra-industry nature (Balassa, 1987;88;Bhagwati & Davis;Bhattacharyya, 2000;Grubel & Lloyd, 1975;Gullstrand, 2002;Melitz, 2003), the export and import of products that are possible substitutes for each other in relation to the inputs and consumption (Tharakan, 1985). Increasing part of the IIT in the volume of global trade is important to the changes in the economy, export and import structure of separate countries (Snieska, 2008), leading to a change in the nature of international trade and its structure of goods. ...
... Balassa (1966) presented the first IIT index for measuring the degree of trade overlap based on the simultaneous import and export of goods within an industry. Grubel and Lloyd (1975) published a study that captured great interest among researchers in IIT and the most often used index to assess the importance of intra-industry. The authors measured Intra-industry trade and export specialization: the Dominican Republic and Colombia case levels of trade in products from similar industries among countries with similar factor endowment. ...
... The authors measured Intra-industry trade and export specialization: the Dominican Republic and Colombia case levels of trade in products from similar industries among countries with similar factor endowment. After Grubel and Lloyd (1975) publication, many empirical studies were conducted (Finger, 1975;Greenaway and Milner, 1983;Tharakan, 1983;Loertscher & Wolter, 1980;Greenaway & Milner, 1984;Torstensson, 1996;), and innovations were made related to the development and refinement of models of monopolistic competition and international trade (Lancaster, 1980;Krugman, 1979;1980;Helpman & Krugman, 1985), as well as in the strategic interaction and intra-industry trade (Brander, 1981;Brander & Krugman, 1982). ...
... Several challenges emerged, specifically on supply, working atmosphere, and production, which potentially brings either negative or positive impacts (Brynjolfsson, McAfee, 2014;Schwab, 2016;Liao et. al, 2018;Liu, 2017;Hallward-Driemeier, Nayyar, 2018;. Various sectors experienced significant impacts, including electronics, computers, and optical instruments, electrical machinery and equipment, and transportation tools. ...
... al, 2015). IoT automates production, as well as communicates and shares information to optimise the entire value chain (Hallward-Driemeier, Nayyar, 2018). ...
... The intra-industry trade between factory (ASEAN) and headquarter economy (USA, Japan, China, and Korea) is a vertical IIT, also defined as simultaneous export and import of products different by quality and technology. The most popular measure of IIT is the index introduced by Grubel & Lloyd (1975). It is often also referred to as Grubel-Lloyd (GL Index). ...
Article
Full-text available
East Asia is the most dynamic region showing high economic growth in the last decades. This is attributed to the "Factory Asia", which refers to regional fragmentation of production. In this case, technologically advanced countries, also called headquarter economies, hollow out the most labour-intensive production stage to the ASEAN countries and make it a "factory economy" producing parts and components. Technological developments in the fourth industrial revolution era have introduced labour-saving technologies in the manufacturing sector. As a result, low wages have become a less important determinant of competitiveness, which is predicted to end "factory Asia." This study examines whether the adoption of Industry 4.0 in manufacturing is detrimental to the factory economy. It investigates intra-ASEAN regional relations and their relationship with headquarter economies, including the USA, Japan, China, and Korea (ASEAN + 1). Utilising the Regional Trade Introversion Index (RTII) analysis tool, the study examines the interdependency between the ASEAN countries and the head-quarter economies. The vertical intra-industry trade approach was used to assess the quality of ASEAN's exports to the headquarter economies. The results showed that ASEAN's factory economy was not disrupted by the adoption of Industry 4.0 in the manufacturing sector. With a high intra-industry trade index and the positive intra-ASEAN RTII, the ASEAN trade block strengthens. Exports of higher quality products from ASEAN countries to the headquarter economies, especially China and Korea, have consistently increased. Furthermore, geography is important in network production fragmentation and there is a differentiation among the headquarters and the factory economy.
... The major limitation of this indicator is related to the equal importance of all industries, regardless of their share in trade and the negligence of trade imbalance. Based on Balassa's research, Grubel and Lloyd (1975) continued developing this intra-industry trade model. ...
... Moreover, Grubel and Lloyd (1975) and Greenaway (1986Greenaway ( ,1989) claim that intra-industry trade would have better effect in the case of RTA (regional trade agreements) between developed countries. The reason is that intra-industry trade would grow more, the greater is the economies of scale, the higher is the per capita income, and the more diversified is the demand (Kim & Lee, 2021). ...
... In this context, IIT is explained by economies of scale, industrial concentration, and the differentiation in products. This type of trade predominates in the same sector or the same branch; see, for instance, Grubel and Lloyd [26] and Greenaway and Milner [27]. ...
... Besides, this investigation will verify the panel unit roots, multicollinearity, and cross-sectional dependence tests. The index of intra-industry trade (e.g., Grubel and Lloyd [26]) can be represented by: ...
Article
Full-text available
This paper revisited the link between intra-industry trade (IIT) between Portugal and Spain and Portuguese carbon dioxide (CO2 ) emissions. The research also considers the effects of foreign direct investment (FDI) on CO2 emissions, pondering the arguments of the pollution haven hypothesis and the halo hypothesis. As an econometric strategy, this investigation has applied panel data, namely a Pooled Mean Group of an Autoregressive Distributed Lag (ARDL) model and Panel Quantile Regression (PQR). The preliminary unit root tests indicated that IIT, Portuguese and Spanish renewable energy, and Portuguese FDI are integrated into the first differences and stationary with the second generation test (Pesaran methodology). In the next step, this study applied the multicollinearity test and cross-dependence between the variables. The variance inflation factor test demonstrated that FDI and IIT have no multicollinear problems. However, as expected, collinearity exists between Portuguese and Spanish renewable energy. Regarding the cross-sectional dependence test, this investigation concluded that the variables have a dependence between them. The cointegration test revealed that the variables are overall cointegrated. In the econometric results with the ARDL estimator, this investigation has found that IIT between Portugal and Spain is negatively correlated with Portuguese CO2 emissions, showing that this type of trade encourages environmental improvements. However, the PQR demonstrates that there is an opposite relationship. According to this, Portuguese and Spanish renewable energy is negatively impacted by CO2 emissions, revealing that renewable energy aims to decrease pollution. Finally, Portuguese FDI reduces CO2 emissions, which is explained by product differentiation, innovation, and monopolistic competition.
... The theoretical work on IIT started to gain recognition after Grubel and Lloyd published a book on IIT in 1975. Grubel and Lloyd (1975) analysed the trade pattern of member states of the Organisation for Economic Cooperation and Development (OECD) and realised that there was a steady increase in IIT. This was somehow contrary to existing trade theories at that time, such as the Heckscher-Ohlin-Samuelson comparative advantage and specialisation theories. ...
... This was somehow contrary to existing trade theories at that time, such as the Heckscher-Ohlin-Samuelson comparative advantage and specialisation theories. Grubel and Lloyd (1975) developed an index to measure IIT, which is given in Equation 1 as follows: ...
Article
This paper empirically examines the flow of Central African Economic and Monetary Community (CEMAC) intra-industry trade at different sectors and product categories using the Standard International Trade Classification (SITC). An augmented gravity model of trade was adopted to analyse changes in the different sectors and product categories from 1995 to 2015; this is the time span for which consistent and useable time series data is available for CEMAC. A time fixed effects variable and within estimator were included to control for unpredictable changes in exogenous factors and capture the heterogeneity of the sample over time. The results showed that prior to the formation of the CEMAC customs union, the growth in intra-industry trade had been higher than that of the CEMAC customs union with the exception of very few sectors and that since the establishment of the customs union in 1994, IIT trade has remained low and only Cameroon has witnessed an increase in trade with member states, especially in food and live animals. The results also showed that only mineral fuels exports had been significant and positive for Chad and Equatorial Guinea.
... A vast literature attempted to explain the phenomenon of IIT mainly focus on: 1) the measurement of IIT (Grubel andLloyd 1975, Brülhart 1994), 2) theoretical framework (Linder 1961, Helpman andKrugman 1985), 3) determinants of IIT for country-specific (Greenaway et al. 1994, Zhang andLi 2006), industry-specific (Greenaway et al. 1995, Fontagné et al. 1998, and 4) the combination of both (Balassa and Bauwens 1987). Many previous studies empirically examine the determinants of IIT among advanced countries (i.e. ...
... In this study, the most commonly used standard Grubel-Lloyd index (Grubel and Lloyd 1975) was adopted to measure country-specific and industry-specific level of IIT in a non-weighted average form: ...
Article
Full-text available
Intra-industry trade (IIT) is prominent to have potential benefits to improve the economic prospects of countries and has gradually been pivotal in understanding developing countries’ trade, including those in Africa. This study evaluates the extent of IIT between China and 18 major African trading partners across 10 Standard International Trade Classification (SITC) industries, and examine the influencing factors of China-Africa IIT between the periods 2007 – 2018. Using a non-weighted Grubel–Lloyd index, the overall level of China-Africa IIT remains low but has certain level of potential between some partners. Among the 10 SITC classified industries, SITC 0 (Food and live animals), SITC 2 (Crude materials, inedible, except fuels), SITC 5 (Chemicals and related products, n.e.s.) and SITC 6 (Manufactured goods classified chiefly by material) had potential for IIT. In addition, the influencing factors of China-Africa IIT were examined using an improved gravity model estimated by Feasible Generalised Least Squares (FGLS) in a panel data framework. The main empirical regression model results reveals that, China’s IIT with major African trading partners are significantly influenced by gross domestic product (GDP), foreign direct investment (FDI), real exchange rate, trade intensity, distance, and landlocked countries. The study further reveals that, GDP and FDI boost China-Africa IIT whereas real exchange rate, trade intensity, distance, and landlocked depress IIT.
... Therefore, among the most controversial and profusely issues studied in recent international trade literature is the measurement of intra-industrial trade. One of the earliest approaches to the measurement of intra-industrial trade was carried out by Grubel and Lloyd (1975). Likewise, the intra-industrial trade index of Grubel-Lloyd has served as the basis for the development of other types of approaches, such as those carried out by Dixit and Stiglitz (1977) and Lancaster (1980), with market structures under monopolistic competition. ...
Article
Full-text available
This article analyses trade flows EU-ASEAN, focusing on export performance and technological intensity, covering the years 2004–2016. The aim of this paper is to analyse to what extent, a further trade integration between the EU and ASEAN, could generate business opportunities for countries in both trading blocs. This analysis could serve as a basis for designing and implementing effective policies and strategies by policymakers in the face of a deepening EU-ASEAN trade integration. Therefore, a detailed analysis of the degree of complementarity of trade patterns, the weight of intra-industry trade, and the revealed comparative advantages allows us to outline some of those challenges and opportunities. Results suggest that intra-industry trade is moderate, mainly focused on few manufactures, accounting for a low value of total trade flows between the two blocs, and concentrated in a few countries. The Lafay index analysis suggests that the EU and ASEAN are natural partners regarding the technological patterns of the revealed comparative advantages; therefore, a deepening in trade integration between this trading blocs could allow to exploit those comparative advantages.
... The GVC, originated from the vertical specialization theory proposed by Balassa in 1967, emphasized that each country specializes in a specific stage of production and the parts of product production were connected through trade chains (Balassa, 1967;Grubel, 1975;Findlay, 1978) [5][6][7]. Since the 1980s, scholars have improved GVC in different perspectives. For example, Porter (1985) [8], Krugman (1995) [9] and Sturgeon (2001) [10] elaborated the definition and characteristics of GVC based on value system, value-added and spatial reorganization, respectively. ...
Article
Full-text available
Active participation in the global value chains (GVC) has been recognized as an important factor in curbing the growth of carbon emissions. However, how GVC embedment affects carbon emissions in economies and what are the pathways of its impact need to be further studied. This paper analyzes the mechanism of GVC embedment affecting carbon emissions embodied in exports (CEEE) and selects 17 manufacturing industries in 36 economies around the world for empirical testing. It is found that GVC embedment significantly reduces the CEEE. Specifically, GVC embedment has a suppressive effect on the CEEE of both developed and developing countries, and the former has a greater suppressive effect than the latter; the effect on the CEEE of low-tech industries is significantly negative but not conducive to carbon emissions reduction in high-tech industries; complex and forward embedment have higher emissions reduction effects compared with simple and backward embedment. More importantly, GVC embedment reduces the CEEE through energy conservation effect, structure effect and transfer effect, and all of them show significant inverted U-shaped mediation effect. The findings of this paper have important implications for the sustainable economic development around the world under the GVC division of labor system.
... After that, we compute Indonesia's IIT and each of Indonesia's trading partners. An index of IIT is calculated from Grubel & Lloyd (1975) Where X i exemplifies exports in the industry i, and M i exemplifies import in the industry i. This index range is from 0 to 100, which shows no integration for 0 value and fully IIT or strong integration for 100 (Austria, 2004). ...
Article
Full-text available
Many countries try to engage more in international trade to be part of global networks. Foreign investment is one of the ways to improve a country’s economies of scale. Thus, developing countries, such as Indonesia, try to attract more FDI. FDI is mainly export oriented and wants to compete globally. Intra-industry trade measures export and import in the same industry. A high degree of intra-industry trade means a country has strong integration with a partner’s country. This study examines the relationship between FDI in Indonesia’s manufacturing sector and bilateral intra-industry trade between Indonesia and Japan, China, and ASEAN-9, especially at the industry level. The method of this study is the Fixed Effect Model. The result shows that the linkage between FDI and intra-industry trade is only significant in specific industries. In the case of Indonesia and Japan, FDI in the vehicle and other transportation industry has the highest correlation with intra-industry trade. Meanwhile, in the case of Indonesia and China, FDI in the metal, except machinery, and equipment industry shows the highest association with intra-industry trade. In the case of Indonesia and ASEAN-9, the highest linkage between FDI and intra-industry trade is in the textile industry. The relationship between FDI and intra-industry trade differs across locations and industries.Keywords: foreign direct investment, manufacture, intra-industry tradeAbstrakBeberapa negara mencoba untuk lebih terlibat dalam perdagangan internasional untuk menjadi bagian dari jaringan global. Investasi asing dipercaya merupakan salah satu cara untuk meningkatkan skala ekonomi dari suatu negara. Oleh karena itu, negara berkembang seperti Indonesia mencoba untuk menarik lebih banyak penanaman modal asing (PMA). Tujuan utama PMA biasanya adalah berorientasi ekspor dan ingin bersaing di pasar global. Perdagangan intraindustri mengukur ekspor dan impor dalam satu kategori industri. Indeks perdagangan intraindustri yang mempunyai nilai tinggi berarti suatu negara memiliki integrasi yang kuat dengan negara mitra. Kajian ini mencoba menganalisis hubungan antara PMA sektor manufaktur di Indonesia dan bilateral perdagangan intraindustri antara Indonesia dengan masing-masing Jepang, China, dan ASEAN-9, khususnya pada level industri. Metode dari penelitian ini menggunakan Fixed Effect Model. Hasil penelitian menunjukkan bahwa keterkaitan antara PMA dan perdagangan intraindustri hanya signifikan pada industri tertentu. Dalam kasus Indonesia dan Jepang, PMA pada industri kendaraan bermotor dan alat transportasi lain memiliki korelasi tertinggi dengan perdagangan intraindustri. Sedangkan untuk kasus Indonesia dan China, PMA pada industri logam dasar, barang logam, bukan mesin dan peralatannya menunjukkan hubungan yang paling tinggi dengan perdagangan intraindustri. Dalam kasus Indonesia dan ASEAN-9, hubungan tertinggi antara PMA dan perdagangan intraindustri adalah pada industri tekstil. Hubungan PMA dan perdagangan intraindustri berbeda antarlokasi dan industri.Kata kunci: penanaman modal asing, manufaktur, perdagangan intraindustri
... Nous recherchons tout d'abord la spécialisation de l'économie tunisienne et les produits pour les quels, elle dispose des avantages comparatifs et dans un deuxième lieu, on évalue les efforts de diversification. Dans le cadre de cette analyse, on s'intéresse à une diagnostique de l'avantage comparatif des produits tunisiens, dont on utilise l'indicateur de la contribution à la balance commerciale et celui d'avantage comparatif révélé, on s'intéresse ensuite à l'évolution du commerce intra branche via l'indicateur de Grubel & Lloyd (1975). Afin d'évaluer les efforts de diversification il est important d'analyser l'évolution du commerce intra branche prônée par la nouvelle théorie. ...
... zerlik ile açıklanmaktadır (Hoang, 2019: 75). Ancak çalışmaların genel olarak, üretimde yakın ikame olan mallarda bu tür bir ticaretin en önemli iki nedeninin ölçek ekonomileri ve farklılaştırılmış ürünler olduğu üzerinde yoğunlaştığı görülmektedir (Grubel, 1967;Gray, 1973;Grubel ve Lloyd, 1975;Lancaster, 1980;Falvey, 1981;Helpman, 1981;Hummels ve Levinsohn, 1995;Qasmi ve Fausti 2001;Melitz, 2003;Helpman vd., 2008). ...
... The Grubel-Lloyd Intra-Industry Trade ratio (IIT) is used for indicating simultaneous export and import within a specific group of products [64]. It is expressed by the following formula: ...
Article
Full-text available
The 2004, 2007, and 2013 enlargement of the EU opened up free trade opportunities, increasing trade flows and demand for products of agriculture. On the one hand, the integration processes have intensified competition between countries, and on the other hand, they have created new opportunities for them. The aim of the study was to evaluate the effect of European integration on the competitiveness of the agricultural sector in countries that acceded to the EU in or after 2004. The assessment of the competitiveness of the agricultural sector was made using the following indicators: land and labour productivity in agriculture, importance of the agricultural sector in the economy of the EU countries, agricultural trade balance, importance of agricultural export in total export of the EU countries, trade coverage ratio, Grubel–Lloyd intra-industry specialization indicator, and Balassa comparative advantage indicator. The analysis was carried out from 2004 to 2020 with the Eurostat statistical database. The outcome of surveys implies that a gap still exists between the old and the new member states of the European Union (EU) in the efficient utilisation of their production factors, despite an increased dynamics of growth in labour productivity compared with the old member states, the so-called EU-15. The overall competitive position of all EU-13 countries in agricultural trade on the common EU market has improved; however, individual analysis reveals disparities between respective member states. In 2020, net exporters with comparative advantage were Hungary, Bulgaria, Lithuania, and Croatia, and net importers with comparative disadvantage included Poland, Czechia, Slovakia, Estonia, and Malta. Latvia and Romania improved their competitive position in agricultural trade.
... According to Gustafsson, The Grubel-Lloyd index is the normal calculation of Intra-Industry Trade. In 1975 Grubel and Lloyd described Intra-Industry Trade as "the value of an industry's exports that are exactly balanced by the same industry's imports" (Grubel and Lloyd, 1975). Their index takes into account trade overlap. ...
Article
Full-text available
The primary goal of this research is to determine the short-term and long-term consequences of regional export growth, regional export diversification, regional intra-industry trade, and regional revealed comparative advantage on Bangladesh's GDP growth from 1990 to 2017. In the first phase, trade indices like regional export growth (EXG), regional export diversification (RED), regional intra-industry trade (RIIT), and regional revealed comparative advantage (RRCA) for Bangladesh's textile and clothing industry in the North American market were calculated based on data from the World Integrated Trade Solution (WITS) and World Trade Organization (WTO). GDP growth is used as a proxy measure for Bangladesh's overall economic development. To check the data series' stationarity, we used several unit roots tests (e.g., ADF and PP). To ensure robustness, the Johansen cointegration test, Engle-Granger Causality test, and ARDL bound test approach were used. The results revealed that the variables have substantial long-run cointegration. In addition, the findings revealed that an improvement in regional export diversification, regional intra-industry trade, and regional revealed comparative advantage increase Bangladesh's GDP growth. In contrast, the increase in regional export growth hinders the GDP growth of Bangladesh in the long-run. According to the facts, Bangladesh's government and policymakers should be concerned about diversification among established product categories and the exploration of new regional markets for the country's long-term economic growth.
... Finger (1967) fut le premier à proposer un indicateur mesurant directement la part du commerce intra-branche dans le commerce total d'une branche industrielle. Par la suite, Grubel-Lloyd (1975) ont réécris cet indicateur, qui est le plus souvent utilisé, afin de l'interpréter plus facilement (le détail de calcul figure en annexe n°1). Toutefois on a pu observer que cet indice mesure seulement l'ampleur du chevauchement des échanges entre deux pays partenaires. ...
Article
Full-text available
The funding decision is a major financial decision of the company. Have an adequate capital structure can improve the performance of the business and therefore create value . In this article which deals with the case of SMEs, the aim is to examine the financial structure of SMEs in order to highlight the factors that may explain the choice of SME financing. This work is based on the analysis of secondary data collected from 413 SMEs in Cameroon, from the investigation initiated by the Ministry of Small and Medium Enterprises, Social Economy and Handicrafts (MINPMEESA) Government of Cameroon and conducted by the Japan International Cooperation Agency (JICA) on behalf of the Japanese government. To identify factors that could explain the choice of financing of SMEs, we use a multinomial logit model with three terms and the recently proposed in this context estimates methods. Our results show that: the size, tangibility of assets, profitability and industry strongly influence the decision to choose a method of financing Cameroonian SMEs . However, the Cameroonian SMEs establish a preference in their choice of financing on the level of financing costs
... Intra-industrijska trgovina (IIT) predstavlja istovremeni izvoz i uvoz sličnih proizvoda od strane iste zemlje. U radu je korišćen Grubel -Lojdov (Grubel -Lloyd) indeks (GLI) intra-industrijske trgovine, koji se u literaturi najčešće koristi za merenje IIT (Grubel -Lloyd, 1975). Indeks može imati vrednost između 0 i 1. Veća vrednost GLI ukazuje na veći intenzitet IIT. ...
Article
Full-text available
Znotrajpanožna trgovina je sočasni izvoz in uvoz podobnih izdelkov s strani ene države. Pri tem se lahko kakovost izmenjanih izdelkov močno razlikuje. Zato je pomembno, da upoštevamo delež vertikalne in horizontalne znotrajpanožne trgovine v celotni znotrajpanožni trgovini. Pri horizontalni znotrajpanožni trgovini (HIIT) gre za izmenjavo podobnih izdelkov primerljive kakovosti, medtem ko se vertikalna znotrajpanožna trgovina (VIIT) nanaša na izmenjavo podobnih izdelkov različne kakovosti. Članek analizira horizontalno in vertikalno znotrajpanožno trgovino med Srbijo in Slovenijo v obdobju med 2004 in 2019. V tem obdobju se je Grubel-Lloydov indeks znotrajpanožne trgovine gibal med 0,22 in 0,48. Poleg tega je bil opažen višji delež vertikalne znotrajpanožne trgovine, kar nakazuje večjo zastopanost izmenjave proizvodov različne kakovosti v strukturi celotne znotrajpanožne trgovine.
... Because of the diversification of the secondary (industrial production) and tertiary (services) sectors, as well as the diversification of consumer preferences driven by an increase in individual income per capita, the exchange of homogeneous goods started to be replaced by trade in varied goods. Thus, the inter-industry trade has evolved into intra-industry trade (IIT), consisting in the simultaneous import and export of products from the same branches of industry (Grubel and Lloyd 1975). ...
Article
In this paper, we aim to identify the intensity and nature of intra-industry specialisation in the global trade in citrus fruits. We used data from the United Nations Comtrade database. We performed both static and dynamic assessments of the intensity of intra-industry trade (IIT) by using the traditional Grubel-Lloyd index and the marginal IIT (MIIT) index, respectively. We also separated IIT into horizontal and vertical trade, and we verified the relationship between changes in the intra-industry pattern of trade and the level of comparative advantage gained by the largest producers and exporters of citrus fruits in the world. We used the revealed symmetric comparative advantage (RSCA) index to evaluate the level of international competitiveness. Conducting these analyses allowed us to fill the existing research gap by identifying the nature of IIT in products with specific quality characteristics but at a lower processing stage. The study's results indicated that the stronger the IIT or the more intensive shifts toward deepening the intra-industry specialisation, the lesser the comparative advantage of a country in the global export of citrus fruits. Nevertheless, the increased intensity of intra-industry specialisation does not always lead to a deterioration in the value of the trade balance.
... Grubel-Lloyd index (Grubel and Lloyd 1975) of intra-industry trade intensity: ...
Article
We explore the nexus between varieties of capitalism and optimum currency area theory and analyze the impact of institutional architecture on business cycle synchronization between the euro area and each of the 25 EU countries. We find that the economies with greater institutional resemblance to the German cluster show stronger business cycle synchronization with the euro area. We corroborate the conclusions from previous studies, stating that without limiting institutional heterogeneity in the euro area its sustainability is at risk. Our results are a strong argument for going beyond the theory of optimum currency areas while evaluating the long-term costs of monetary integration.
... Ocena pozycji konkurencyjnej handlu zagranicznego sektora rybnego krajów Unii Europejskiej została oparta o miary wynikowe kształtowania się cech wymiany handlowej ex post. W analizie wykorzystano trzy wskaźniki konkurencyjności: wskaźnik ujawnionych przewag komparatywnych w eksporcie wg Balassy (RCA) (Balassa, 1965), wskaźnik Lafaya (LFI) (Lafay, 1992) oraz wskaźnik handlu wewnątrzgałęziowego wg Grubela-Lloyda (GL) (Grubel, Lloyd, 1975). Wskaźniki te zwane są także wskaźnikami specjalizacji i pozwalają ocenić jej intensywność w podziale na poszczególne gałęzie gospodarki (Monitoring i ocena…, 2011). ...
Article
Full-text available
Artykuł przedstawia pozycję handlu zagranicznego rybami, owocami morza oraz ich przetworami w poszczególnych krajach Unii Europejskiej na tle handlu zagranicznego produktami rolno-spożywczymi ogółem. Ocenie poddano konkurencyjność handlu sektora rybnego względem innych branż oraz przedstawiono zmiany jakie zaszły w tym zakresie w latach 2003-2014.
... (1994), göreceli sermaye bolluğu kişi başına göreceli gelire yansıtıldığında, iki ülkenin kişi başına gelir benzerliği ne kadar fazla ise endüstri içi ticaretin payı o kadar fazla olacağını belirtmektedir. Grubel (1975) ampirik çalışmasında Japonya ve Almanya'nın kişi başına düşen yurt içi gelirlerinde, yüksek kaliteli mallara yönelik yurt içi talep ve üretimde ve bu malların diğer ülkelerden daha düşük kaliteli ithalat için ihracatında eşzamanlı bir artış yaşadıklarını belirtmektedir. Balassa (1986), kişi başına gelir farkının, ABD ve diğer ülkeler arasında endüstri içi ticaret ile negatif ilişkili olduğu tespit etmiştir. ...
Conference Paper
Full-text available
In this study, the relationship of intra-industry trade with selected variables in textile products trade between Turkey and G7 countries (Germany, USA, England, France, Italy, Japan and Canada) is investigated by econometric methods. According to the annual foreign trade data of textile products between 1995 and 2020, the intra-industry trade index was calculated by the Grubel-Llyod method, which is widely used in the literature. In the econometric analysis of the study, Grubel-Llyod index in textile products was used as dependent variable, market size difference and development level difference were used as independent variables. The effect of selected variables on intra-industry trade was estimated by FMOLS, DOLS and CCR methods. According to the three methods used; market size difference in textile products negatively affects intra-industry trade as expected, and the difference in development level affects intra-industry trade in textile products positively contrary to expectations.
... Though, there were several convincing cases against the Heckscher-Ohlin theory, starting with Leontief (1953), who asserted that U.S. imports in 1947 were more capital intensive than her exports. Also, Grubel and Lloyd (1975), who empirically asserted that trade among the industrial economies is increasing far above the output, despite the similarity in the factor endowment of these countries. Regarding the quantum of new theories and publication by the foremost trade theorist, HO theory still found footing in the academic discourse. ...
Article
Full-text available
This paper investigated the decline of capital importation to Nigeria and specifically banking business in Nigeria in the pre-COVID-19 pandemic era and during the COVID-19 pandemic era. The investigation became necessary considering the high prevalence of the COVID-19 pandemic in most of the top countries with capital exportation into Nigeria and the sharp decline in the importation of capital. Bringing, liquidity and stability of the banking business into concern. Data on capital importation were extracted from the CBN Statistical Bulletin and analyzed using a test for equality of means with both the Anova and Welch F-tests. We found that there is statistically significant difference in the averages of the capital importation to the banking business and Nigeria as a whole between the two periods of concern. We recommend that this [the reduction in the capital importation] should be monitored intermittently to ensure survival, stability, liquidity and enhanced share premiums of the banks. Also, the regulating authorities should regulate towards promotion of liquidity and stability in the financial system by permitting certain policies to take effect, such as transforming from Plc. to HoldCo structure.
... The Grubel-Lloyd index [64,65] is used to calculate the ratio of intra/industry trade to total trade, where X i is exports, M i is imports, and i stands for a particular country. Its value ranges <0.1>. ...
Article
Full-text available
The question of the sources of agricultural competitiveness is widely discussed on the farm and sectoral levels in the European Union. This paper assesses the competitiveness of the plant production using the combination of trade measures and strategic management measures in the selected European countries related to the Czech Republic. Thus, the paper evaluates and identifies the sources of competitiveness of plant production. In the case of Belgium and the Netherlands, labour and capital factors have a significant influence on production; in the case of the new member states, these factors are less important, and, conversely, market competitiveness factors are more crucial. The continuous convergence process between Belgium and the Netherlands is illustrated. The divergence between the Netherlands and the rest of the countries is also visible. There is a stable connection between the Czech Republic and Austria, France, and Slovakia. It can be mentioned that there is no statistically significant difference in the comparative advantage between 2005 and 2019, except in the case of France. Analysing sources of competitiveness among the countries of interest is a possible tool for the future direction of trade policies.
Preprint
Full-text available
We develop hypothetical basic laws of trade that could reconstruct the theory of international trade and optimize gains of trade for all nations. According to the theory of comparative advantage of David Ricardo and Ohlin-Heckscher, countries with different resources and technology will benefit from trading, regardless of competitiveness. However, in the real world, this theory does not always work well. Some countries may gain a lot from trading, some only a little, and some may even lose. The total gain for all parties is also not optimal. The basic laws of trade can fix this problem substantially. They restore the trade balance at the very heart of international trade. In that way, they make all countries benefit from trading, regardless of competitiveness and cost. Gains from trade are also optimal for all parties. To demonstrate the workability of this hypothesis, we make trade simulations 2x2 and 5x20.
Thesis
Full-text available
The processes of economic integration that involve monetary integration are common and current phenomena. An increase in integration activity can be observed, especially in Africa and Southeast Asia. However, the euro area should be seen as a model-based monetary union. The eurozone is presented as the main entity of analysis in this paper. The functioning of the entire European monetary zone was shown holistically. The euro area is considered to be the second-largest economy in the world after the USA. The aforementioned aspects constitute the topicality and importance of the research problem. This dissertation aims to show the importance of the euro area as an incomplete monetary union and the divergence between Poland and the eurozone, which would implicitly indicate that Poland is not ready to adopt the euro. The European monetary area did not meet the criteria of the optimum currency areas theory, which is considered to be the central part of monetary integration. In this paper, three research hypotheses were formulated. The first one concerns the fulfillment of the convergence criteria; the conclusion was made that most of the euro area Member States do not meet the convergence criteria whatsoever. Subsequently, the euro area was presented as a non-optimal currency area. The last hypothesis concerns the enlargement of the eurozone; it is not likely to observe new countries joining, although the process of integration among current countries is to intensify. As a research method, the standardized sum method was used to empirically verify the convergence criteria. The fulfillment of each criterion of the theory of optimum currency areas by the euro area, also in empirical terms, was verified by comparative macroeconomic analyses using the databases of the World Bank, Eurostat, Statistics Poland, European Central Bank, National Bank of Poland, Polish government websites, as well as monographs and empirical articles related to the topic of the dissertation. This paper consists of five chapters. Each chapter begins with introductory remarks and ends with concluding ones. It is stated that the euro area is an incomplete monetary union due to the lack of fiscal unification as well as a non-optimal currency area since the eurozone does not fulfill all the criteria of the optimum currency areas theory. Hence, the euro area with 19 members is a political project, not an economic one. The divergence between the Member States is significant. An empirical analysis ruled out the possibility of Poland joining the euro area, both de jure and in the economic sphere since this country did not meet the convergence criteria. Denmark met all the convergence criteria in 2020 and thus is considered a leader to join the euro area. However, the country has an opt-out clause that does not oblige it to adopt the euro currency in such a situation. The potential membership of Sweden and Bulgaria should be the direction for further research on European integration. In light of the above-mentioned hypotheses, the first one in the matter of the convergence criteria was confirmed. Most of the current members of the euro area did not meet the convergence criteria in 2020. This leads to the conclusion that the convergence criteria should also be verified and followed by the eurozone Members States. The second hypothesis related to the eurozone as a non-optimal currency area was also confirmed. This is proven by an empirical analysis of the criteria of the optimum currency areas theory. This statement was also acknowledged by other researchers in the field of monetary integration. The third hypothesis on enlargement was also confirmed. The only country that seems ready to adopt the euro is Denmark, though the country is not willing to adopt the single currency at the moment. On the other hand, regarding cooperation among countries, the creation of a fiscal union might be considered soon. It would allow one to define the euro area as a full monetary union.
Article
One of the study proposals of the intensity of the intra-industry trade was presented Glejser et al. (1982). It is competitive with many foreign trade indicators which do not take account of the country specialization in import and export and do not refl ect adequately the effects of trade imbalances. On based the variance of the export and import specialization indicators Glejser et al. (1982) created a tool that overcomes these shortcomings. The proposed method, however, was not equipped with an appropriate statistical and econometric tools, which greatly limits its practical usefulness. This article attempts to improve the method and test it on the example of foreign trade in Poland.
Preprint
Full-text available
Bilateral trade has significantly influenced economic growth over the past few decades. This study examines bilateral intra-industry trade between China and South Asian countries from 2000 to 2020. Intra-industry trade IIT is further decomposed into vertical intra-industry VIIT and horizontal intra-industry HIIT to indicate two-way and one-way trade relationships. The estimated results show that in the South Asian region, only two countries, Pakistan and India, have a two-way bilateral trade relationship with China, and the intra-industry trade between China and South Asian countries rapidly increased from 2000 to 2020, which positively impacted bilateral economic growth between China and South Asian countries. The findings of the GLS model examine Bilateral cross-section GDP, GDP per capita, FDI, and Min. GDP and Language have a positive and significant impact on IIT but a negative impact on both HIIT and VIIT but the Bilateral Trade cross-section difference FDI, Max. GDP and LXMGDP have a negative influence on IIT but have a positive and significant influence on both HIIT and VIIT.
Article
Purpose: It is to empirically examine the factors affecting intra-industry trade in the automotive sector between Turkey and 24 OECD member trade partners. Design/Methodology: The determinants of intra-industry trade were tested with panel data analysis in the automotive sector. As a result of the test carried out to determine the model, regression analysis was performed with the Driscoll-Kraay standard error estimation method. Findings: The variables market size, development level, and trade openness have a positive impact on intra-industrial trade, while the variables market size difference, income inequality, and geographical distance have a reverse impact on intra-industry trade. Limitations: Export and import data for 2003–2019 are used in international trade figures in the 3-digit Standard International Trade Classification, SITC Revision-3. Originality/Value: Empirical application on the factors affecting intra-industry trade in the Turkish automotive sector is considered to be important and different in terms of subject.
Thesis
Full-text available
Bu tez çalışmasının amacı, BRICS ülkelerinin ve Türkiye’nin ihracat rekabet güçlerini, Açıklanmış Karşılaştırmalı Üstünlük Katsayılarını kullanarak belirlemek, BRICS ülkeleri ile Türkiye’nin ihracat rekabet güçlerini karşılaştırmaktır. Ayrıca hem BRICS ülkelerinin hem de Türkiye’nin ihracat rekabet güçlerinin küresel çapta değerlendirilerek Türkiye’nin ihracat ve ithalat politikalarında bir yol haritası önermek de bu çalışmanın amaçları arasındadır. Bu çalışmada, ülkelerin ihracat rekabet güçlerini belirlemek için söz konusu ülkelerin 1999-2018 yıllarını kapsayan 20 yıllık ihracat-ithalat verileri (ABD doları cinsinden) kullanılmış ve çeşitli Açıklanmış Karşılaştırmalı Üstünlük (RCA) indeksleri ile analiz edilmiştir. Üç bölümden oluşan tezin birinci bölümünde, rekabet ve rekabet gücü kavramları teorik bağlamda ele alınmış ve ihracat rekabet gücünün ölçümünde kullanılan indekslere yer verilmiştir. Sonrasında ise konuyla ilgili literatür taraması yapılmıştır. Tezin ikinci bölümünde, BRICS ülkelerinin ortak özellikleri, kuruluş amaçları ve hedefleri, tarihsel gelişimleri ve BRICS zirveleri ele alınmıştır. Daha sonra ise bu ülkelerin sosyokültürel ve makroekonomik göstergeleri Türkiye verileriyle karşılaştırmalı bir şekilde incelenmiştir. Tezin son bölümü olan üçüncü bölümde ise analiz sonuçlarına yer verilmiştir. Ticaret Açıklık (Bağımlılık) İndeksi sonuçlarına göre; 2018 yılı GSYH içindeki dış ticaret payı en yüksek olan ülkelerin Türkiye ve Güney Afrika olduğu tespit edilmiştir. İhracat Benzerlik İndeksine göre; 2018 yılında Türkiye ile en fazla ihracat benzerliği gösteren ülkelerin %49 ile Hindistan ve Çin olduğu belirlenmiştir. Teknoloji sınıflandırmasına göre; Brezilya’nın hammadde yoğun ve sermaye yoğun, Rusya’nın hammadde yoğun, Hindistan’ın hammadde yoğun ve emek yoğun, Çin’in emek yoğun ve kolay taklit, Güney Afrika’nın hammadde yoğun ve sermaye yoğun, Türkiye’nin ise emek yoğun ve sermaye yoğun malların ihracatında karşılaştırmalı rekabet gücü elde ettiği tespit edilmiştir. Vollrath İndeksi sonuçlarına bakıldığında; Brezilya’nın 73, Rusya’nın 43, Hindistan’ın 88, Çin’in 99, Güney Afrika’nın 76 ve Türkiye’nin ise 93 mal grubunda küresel ölçekte rekabet avantajı elde ettiği sonucuna ulaşılmıştır. Net İhracat İndeksi sonuçlarına göre; Brezilya’nın 102, Rusya’nın 71, Hindistan’ın 121, Çin’in 142, Güney Afrika’nın 90, Türkiye’nin ise 93 ürün grubunda rekabet avantajı elde ettiği belirlenmiştir. Endüstri İçi Ticaret İndeksi 20 yıllık aritmetik ortalama sonuçları göz önünde bulundurulduğunda ise en yüksek endüstri içi ticaret değerine sahip ürün kodunun Brezilya için 516, Rusya için 278, Hindistan ve Çin için 629, Güney Afrika için 679 ve Türkiye için ise 664 olduğu sonucuna varılmıştır. Ayrıca çalışmanın en son kısmında, Standart Uluslararası Ticaret Sınıflandırması (SITC), Spearman Korelasyon Katsayısı kullanılarak analiz edilmiştir.
Article
Productivity varies widely between industries and countries, but even more so across individual firms within the same sectors. The challenge for governments is to strike the right balance between policies designed to increase overall productivity and policies designed to promote the reallocation of resources towards firms that could use them more effectively. The aim of this book is to provide the empirical evidence necessary in order to strike this policy balance. The authors do so by using a micro-aggregated dataset for 20 EU economies produced by CompNet, the Competitiveness Research Network, established some 10 years ago among major European institutions and a number of EU productivity boards, National Central Banks, National Statistical institutes, as well as academic Institutions. They call for pan-EU initiatives involving statistical offices and scholars to achieve a truly complete EU market for firm-level information on which to build solidly founded economic policies.
Chapter
This paper focuses on the issues of searching for new foreign trade partners for developing and transitional economies that have been subjected to sanctions by developed countries. It is proposed to search for new foreign trade partners using a coefficient analysis by the proposed algorithm based on international digital statistical databases. The paper notes that the active use of such databases by entrepreneurs in many developing and underdeveloped countries is impossible due to the lack of access to Internet resources. International organizations need to focus their efforts on improving the ability of businesses to access international digital statistical resources as a way to facilitate foreign trade. The development of foreign trade and the search for new counterparties will provide additional opportunities for developing and underdeveloped countries to participate in global value chains, which will lead to the expansion of the market for manufactured products, increase in jobs, additional financial resources generated from foreign economic transactions, the import of new business practices and technologies, and the import of necessary goods.
Article
Full-text available
This paper investigates the bidirectional relationship between Intra-industry trade efficiency (IITE) and welfare gains from trade. The determinants of IIT taken form the literature, includes research and development, relative comparative advantage, product differentiation, economies of scale, consumer price index and total factor productivity. Data Envelopment Analysis (DEA) for deriving efficiency scores is applied and gains from trade in differentiated products are supposed to be obtained through three channels: decrease in price, improvements in productivity and increase in the variety. Using data on 22 high-income countries and 20 middle-income countries over 2001 to 2017, the bidirectional relationship between the considered sources of gains from trade and IITE has been confirmed, and the results support the hypothesis of the differences between the importance of the factors determining efficiency of intra industry trade in two groups of considered countries.
Article
Full-text available
The paper examines and evaluates the impact of the Russian embargo on the development and specialization of agri-food foreign trade between Slovakia and Russia through the evaluation of the one-factor Lafay and Grubel-Lloyd indexes. As a result of the application of the Russian embargo on imports of agri-food products, based on the calculation of the indexes, we can state that the degree of specialization of Slovak agri-food foreign trade has changed. Although in 2013 Slovakia specialized in exporting a relatively wide range of agri-food products, in 2020, their number decreased. Also, in 2020 there was no overall increase in the volume of mutual trade. In general, Slovakia's exports to Russia decreased compared to 2013. The following factors have contributed to this situation: substantial attenuation, that is, the elimination of Slovak agri-food exports to Russia based on the impact of the Russian embargo with side effects and an increase in imports from Russia but not in absolute but relative terms in the context of its comparison with Slovak exports.
Article
Full-text available
Celem artykułu jest przedstawienie istoty konkurencyjności regionu turystycznego w teorii ekonomii. W opracowaniu szczególną uwagę zwrócono na konkurencyjność turystyki wiejskiej. Konkurencyjność pochodzi od konkurencji stanowiącej podstawowe zjawisko gospodarki rynkowej. Tworzenie warunków do wzrostu konkurencyjności turystyki wiejskiej regionu związane jest ze wzrostem skłonności i zdolności do oszczędności oraz akumulacji podmiotów turystycznych na wsi, a także efektywnego wykorzystania poczynionych inwestycji na drodze realizacji postępu technicznego. Dzięki temu można osiągnąć w perspektywie długofalowej wzrost konkurencyjności, wzrost poziomu dochodów, zatrudnienia i poprawę zamożności społeczności wiejskiej.
Article
The Association of Southeast Asian Nations (ASEAN) region has become more integrated through trade and migration. Yet, public policies in ASEAN do not consider the interrelations between trade and immigration policies. Therefore, the paper employs a static panel gravity model for the 10 ASEAN countries over five-year intervals between 1990 and 2020 to identify the direct connections between migration and trade (exports, imports and intra-industry trade). The empirical results support a pro-import immigrant effect but not a pro-export immigrant effect. The negative effect of the stock of immigrants on the share of bilateral intra-industry trade implies that immigration better explains one-way trade or inter-industry trade. The limited presence of the immigrant-link effects reflects the large stock of unskilled ASEAN immigrants that reduces the possibilities of creating networks between the home and host countries. The significant immigration-import links, however, is sufficient to justify the importance for ASEAN to work towards connecting migration and trade policies.
Article
Subject. The importance of foreign trade for the border regions. Objectives. Assessment of exports and imports by the main commodity groups in relation to the border and inland regions of Russia. Methods. Methods of synthesis, analysis and generalization were used. Results. The Grubel-Lloyd indices were calculated for the main commodity groups and on average for the border regions. It is shown that the existing commodity structure of exports and imports of border regions is unfavorable for their economic development. Quantitative characteristics of the participation of border regions in Russia's international trade can be assessed as significantly lower than those of inland regions. Conclusions. To increase the effectiveness of the participation of border areas in Russia's foreign trade, a differentiated approach to regional policy is needed, in which border areas are considered as a specific object.
Thesis
Full-text available
This study investigates the changing structure of Turkish manufacturing production and trade in the face of the growing predominance of international fragmentation of production processes. In this new stage of globalization, countries are specialized in parts and components of a specific product, rather than specializing in a final product or an industry. Parts and components produced in different countries cross international borders more than once throughout the production process of a final product and thereby creating a qualitative transformation in international trade flows. Models investigating international fragmentation of production deal with the explanatory factors of traditional trade in a novel framework. Hence factors such as technological differences and factor endowments, regional trade agreements, market size, developments in transportation and telecommunication technologies and product diversity come out as the main determinants of fragmentation trade. In the light of these theoretical models, this study analyses the reasons behind parts and components trade between Turkey and its 46 trade partners during the period covering 1992-2009 in a gravity model setting and tries to identify the main determinants of specialization in production stages by using panel data techniques. Empirical findings show that Turkey’s parts and components exports are mainly explained by Turkey’s GDP, wage differences, product diversification and customs union. The main determinants of Turkey’s parts and components imports are Turkey’s GDP, customs union and real exchange rate.
Article
Considering that the competitiveness of a country's industries is determined by many micro and macro factors, Intra-Industry Trade (IIT) in an industry determines many features of this industry such as supply-demand, product price and quality, competition and in this context affects the competitiveness of the industry. is being evaluated. Purpose: In our study, it was aimed to determine the correlation between IIT and competitiveness in Turkey's foreign trade between 2001-2019 on the basis of chapter 97 of HS/GTİP. In our research, the degree of intra-industry trade was measured by the Grubel-Lloyd method. Vollrath's (1991) Revealed Comparative Advantage (RCA) method was used to measure competitiveness. Method: The degree of intra-industry trade was measured by the Grubel-Lloyd method. Vollrath's (1991) Revealed Comparative Advantage (RCA) method was used to measure competitiveness. Correlation analysis and panel data analysis were used to determine the relationship between IIT and competitiveness. Findings: There was a very high positive correlation between IIT and competitiveness in 27 chapters and a very high negative correlation in 24 chapters. High positive correlation was determined in 24 chapters and high negative correlation was determined in 6 chapters. Within the framework of the findings, it can be stated that there is a high or very high correlation between the IIT and competitiveness, which varies according to the chapters. It was observed that the results of the Panel Data Analysis in the study were also compatible with the results of the Correlation Analysis. Originality: It is considered that it will be beneficial to carry this study and its results, which is unique for Turkey, forward and to produce guiding results in economy, development, industrialization and foreign trade policies.
Article
Full-text available
A country’s structure of trade and its impact on the economic growth of nations, has added a new dimension to the literature on trade and growth. That a country’s specialization in different products is important in determining the pattern of growth, is being increasing realized and explored in related emerging literature. The current paper associates itself with this idea, and by means of One Step System Generalized Method of Moments (GMM) estimator applied to dynamic panel models, tries to determine how the structure of trade has influenced the growth rate in the fastest growing region of the world – the emerging and developing Asia. The paper uses alternative measures of trade structure constructed after classifying the merchandise trade data into several categories on the basis of resource, skill and technological requirements. The approach adopted in this paper is thus quite exhaustive, and analyses the problem for the selected region in a manner not attempted in any of the existing studies. Our analysis suggests contradictory results, with measures based on trade specialization highlighting the growth enhancing effect of high skill and technology intensive manufactures, while measures based on trade shares in GDP revealing the growth retarding effects of primary products. Hence, the study reveals that the effect of trade structure on economic growth is dependent upon its adopted definition.
Article
Full-text available
O objetivo deste trabalho é capturar possíveis mudanças no modo de inserção das economias regionais nas cadeias nacionais de valor por meio da utilização de indicadores de vantagens comparativas, desenvolvidos por Béla Balassa e aperfeiçoados por Gérard Lafay, e de indicadores de trocas intraindustriais, elaborados por Herbert Grubel e Peter Lloyd e aprimorados por Antonio Aquino. Com base no comércio inter-regional, desagregado por setores produtivos, extraem-se duas constatações. A primeira é que, em termos de valor agregado, a produção industrial continua fortemente concentrada. A outra aponta para a sedimentação de uma segunda divisão inter-regional do trabalho, que se segue ao processo de desconcentração da produção industrial iniciado nos anos 1970. Após esse período, as participações dos estados menos desenvolvidos nas cadeias nacionais de valor são reorientadas de forma paulatina para a oferta de bens semimanufaturados, de baixa intensidade tecnológica e intensivos tanto em mão de obra como em matérias-primas. Dessa maneira, mudanças significativamente importantes ocorrem na hierarquia do modo de inserção das economias regionais nas cadeias nacionais de valor, possíveis de serem reveladas somente com base na disponibilidade de Matrizes Interestaduais de Insumo-Produto.
Chapter
Full-text available
The Modern technology has created a path to financial inclusion and a new revenue source for financial services providers. The existing pattern of regional banks to outsource solutions has unlocked a "modular" system for frictionless experience and targeted product specialization. The new Regulation that enables open platform and data collection (i.e. Payment Services Directive) has spurred further Fin-Tech expansion. The Banking Sector in India has seen a number of changes. Most of the banks have begun to take an innovative approach towards banking with the objective of creating more values for customers and consequently the banks. E-Banking enables the people to carry out most of their banking transactions using a safe website which is operated by respective banks. With the emergence of Privatisation, Globalisation and Liberalisation in India, banks are focusing on Research and Development and applying various innovative ideas and technology
Article
Full-text available
The Romanian foreign trade was signifi cantly changed after 1990. The privatization , economic restructuring and EU accession had an impact not only on the size and foreign trade diversity but also on the structure and commerce routes. Moreover, Romania's Integration in the European Union on January 1st, 2007, eliminates the trade barriers between member countries, increasing the trade relations within the region and facilitating the expansion of intra-industry trade. This paper aims to analyze the level and structure of foreign trade in Romania after 1989 by analyzing the dependency and the stability indicators. The Grubel Lloyd index is computed by type of ownership of fi rm's capital and specifi c activity of companies export of high-tech products, inward processing transactions, etc. The main conclusion is that Romania should keep a right balance between dependency on EU single market and developing trade relations with other non-EU countries where it can have either an exceeding trade balance or comparative advantages based on high-tech exports.
Article
This article examines trade and production figures for the Common Market countries before and after 1958. The Common Market can be said to have come into effect on 1 January 1959, when the first reductions were made in the internal tariff. But there was not in fact a great deal of discrimination against outsiders before the second set of reductions, on 1 July 1960. So far, these tariff changes do not seem to have had any great effect; other factors must have overborne them.
Article
"Errata" sheet tipped in. Thesis--Harvard University. Graduate School of Business Administration. Bibliographical footnotes.
Article
Location of new products, 191. — The maturing product, 196. — The standardized product, 202.
Article
In recent years some economists have suggested that under a wide range of circumstances free international trade will result in a situation where each country simultaneously produces, exports, and imports products which are very close substitutes for each other in consumption, production, or both. Because of the similarity of these products they are commonly accounted for in the same statistical “industry” classification, and the resultant international pattern of production and trade can conveniently be described as “intra-industry specialization” as contrasted with “inter-industry specialization” which results when countries produce and export but do not import the output of some industries while they import but do not produce or export the output of some other industries. It was considered that in the European Common Market intra-industry specialization dominated over inter-industry specialization and that similar developments were important in the development of Benelux trade. At the same time, but independently from these two suggestions in the literature, two pieces of research produced models capable of explaining which country would tend to specialize in which of the different qualities or styles of commodities making up the international trade in products of the same industries.
Article
1.1 From the economic point of view the ultimate aim of a customs union is not to foster trade for its own sake, but to increase economic welfare by removing trade restrictions. No increase can, however, be anticipated without a change in the pattern of trade. An investigation of these changes in pattern is therefore necessary as a preliminary step before proceeding to estimate the welfare effects upon the countries considered or the world as a whole. Only the changes in trade pattern fall within the scope of this paper.
Article
The work of Mr. Rostas2 and others on the productivity of British and American industries makes it possible to test some aspects of the theory of comparative costs. According to that theory, when based on a labour theory of value and assuming two countries, each will export those goods for which the ratio of its ouput per worker to that of the other exceeds the ratio of its money wage-rate to that of the other. Before the war, American weekly wages in manufacturing were roughly double the British,3 and we find that, where American output per worker was more than twice the British, the United States had in general the bulk of the export market, while for products where it was less than twice as high the bulk of the market was held by Britain. This is shown clearly in Table I, and more detailed figures are given in Table II. Out of twenty-five products taken, twenty (covering 97% of the sample by value) obey the general rule, and two of the remaining five would cease to be exceptions if a different measure of output per worker were chosen.4
Chapter
The Problem to be ExaminedThe Reciprocal Nature of the ProblemThe Pricing System with Liability for DamageThe Pricing System with No Liability for DamageThe Problem Illustrated AnewThe Cost of Market Transactions Taken into AccountThe Legal Delimitation of Rights and the Economic Problem
Article
The research agendas of psychologists and economists now have several overlaps, with behavioural economics providing theoretical and experimental study of the relationship between behaviour and choice, and hedonic psychology discussing appropriate measures of outcomes of choice in terms of overall utility or life satisfaction. Here we model the relationship between values (understood as principles guiding behaviour), choices and their final outcomes in terms of life satisfaction, and use data from the BHPS to assess whether our ideas on what is important in life (individual values) are broadly connected to what we experience as important in our lives (life satisfaction).
Article
According to the advocates of a "Generalized Darwinism" (GD), the three core Darwinian principles of variation, selection and retention (or inheritance) can be used as a general framework for the development of theories explaining evolutionary processes in the socio­economic domain. Even though these are originally biological terms, GD argues that they can be re-defined in such a way as to abstract from biological particulars. We argue that this approach does not only risk to misguide positive theory development, but that it may also impede the construction of a coherent evolutionary approach to "policy implications". This is shown with respect to the positive, instrumental and normative theories such an approach is supposed to be based upon.