Intra-Industry Trade in Malaysian Manufacturing Sector
نویسنده
چکیده
As a result of rapid economic growth and increased influence of globalization in international trade activities, intra-industry trade (IIT) becomes prominent across Asia including Malaysia. Free trade agreements and creations of free trade areas have encourage increased cross border investments through production networking as well as fragmentation of production, especially in manufacturing sector. This paper attempts to examine trends and patterns of Malaysia’s IIT in manufacturing sector using the 9-digit Standard International Trade Classification (SITC) codes from 1990 2010. The IIT trends and patterns are investigated using the Grubel Lloyd (GL) Index adapted from Greenaway et. al (1995) and Fontagne and Freudenberg (1997). The result indicates that the trends and patterns of Malaysia’s manufacturing sector had gradually migrated from traditional inter-industry to intraindustry kind of trade. The average GL index of Malaysia’s manufacturing sector had been gradually increasing from a mere 0.27 in 1990 to 0.51 in 2007 before it slightly dropped to 0.46 in 2010. In terms of quality (high quality vertical IIT), the composition of Malaysia’s IIT in manufacturing sector had slightly increased from only 28.0% in 1990 to 31.5% in 2010 against other two types of IIT namely horizontal IIT and low quality IIT. Many factors contributed to changes in the trends and patterns in Malaysia’s IIT over the last 2 decades. Apart from import substitution and industrialization policies implemented by the government, increased international fragmentation of production, production networks, creation of ASEAN Free Trade Area (AFTA) and other regional trade agreements are the dominant factors that influenced IIT in Malaysia’s manufacturing activities.
منابع مشابه
Differentiated Products , International Trade and Simple
Using a simple general equilibrium model with two countries and two sectors including one manufacturing sector producing (vertically) differentiated products, we first show that an international barrier to trade in the manufacturing sector creates inter-industry trade, whereas an international barrier to trade in the other sector generates intra-industry trade among vertically differentiated pr...
متن کاملCountry-specific Determinants of Intra Industry Trade Types of Agricultural Sector in Selected Developing Countries
متن کامل
The Effects of China's Growth in Manufacturing Sector in the U.S. Economy
T his paper investigates the gain of bilateral trade between China and U.S. in manufacturing sectors when both countries play a role in asymmetric (biased) growth of international trade. Our model includes a special case of Biased Growth Theory in international trade. We collected labor productivity, export and import data by using classification of manufacturing industries, for U.S...
متن کاملInward Investment And Technical Progress In The United Kingdom Manufacturing Sector
This paper investigates the impact of inward investment by foreign-owned companies on technical progress and hence labour productivity in the UK manufacturing sector. Using an industry-level panel data set we find that foreign-owned firms have a significant positive effect on the level of technical efficiency in domestic firms. There is evidence of significant intra-industry and inter-industry ...
متن کاملIran`s Intra-Industry Trade Based on a Schumpeterian Factor Endowment Model
The role of intra-industry trade has been emphasized in international commerce since the 1960s. Innovation and government size, which affect goods and services production and government presence in international commerce, have also been highlighted since then. This study examines the influence of these two factors on international trade and estimates their effects in linear and logistic transfo...
متن کامل