The evolving geography of production hubs and regional value chains across East Asia: Trade in value-added

The interdependence of regional trade and production networks has important implications for national prosperity, regional stability and the internationalization of production. We ask: What are the locational patterns of trade in value-added in East Asia and how are these patterns changing over time? The disintermediation of value chains and the externalization of business activity create hubs of capability and extend value chains between countries. We adopt input-output techniques to analyze the evolution of production networks in East Asia over the period 1990–2005 from a value chain perspective. A high density of cross-border interaction is reported alongside changing geographic dynamics, and an informal integration derived from intermediates trade in value-addition. The locational interdependence of developed and less-developed countries across the region leverages on the heterogeneity of locationspecific advantages within the region. 2014 Elsevier Inc. All rights reserved. * Corresponding author at: Director, International Relations, The University of Melbourne , and Principal Fellow, Melbourne School of Business. McPhee Terrace, Faraday Street, Parkville , VIC 3010, Australia. Tel.: +61 3 8344 0858; fax: +61 3 8344 9961; mobile: +61 4 02969007. E-mail addresses: [email protected] (G. Suder), [email protected] (P.W. Liesch), [email protected] (S. Inomata), [email protected] (I. Mihailova), [email protected] (B. Meng). 1 Tel.: +61 7 3346 8174; fax: +61 7 3346 8166. 2 Tel.: +81 43 299 9685; fax: +81 43 299 9763. 3 Tel.: +358 40 353 8351; fax: +358 9 431 38 880. 4 Tel.: +81 43 299 9685; fax: +81 43 299 9673.