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Analysis of Intra- and Inter-regional Trade in East Asia:Comparative Advantage Structures and Dynamic Interdependency in Trade Flows

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  • Takashi Isogai

    (Bank of Japan)

  • Hirofumi Morishita

    (Bank of Japan)

  • Rasmus Ruffer

    (ECB)

Abstract

This paper analyses the trade relationships within East Asia and between East Asia and the US and Japan, with particular emphasis on the structural changes that occurred during the 1990s. The main purpose of the analysis is to gain a better understanding of the potential global impact of these changes. The analysis of revealed comparative advantage patterns underlines the strong trading position of East Asia in the ICT sector, with the simultaneous gain in "comparative advantage" on the export and on the import side during the 1990s suggesting an increasing role of East Asian countries as a processing and production center. In order to study the consequences of the increasing internationalization of the production process in East Asia a VAR of inter- and intra-regional trade flows is estimated. The main finding is that there are quantitatively significant indirect international transmission channels of country-specific shocks along the international production chain, with substantial differences in the exposure to such shocks between Japan and the US.

Suggested Citation

  • Takashi Isogai & Hirofumi Morishita & Rasmus Ruffer, 2002. "Analysis of Intra- and Inter-regional Trade in East Asia:Comparative Advantage Structures and Dynamic Interdependency in Trade Flows," Bank of Japan Working Paper Series International Department,, Bank of Japan.
  • Handle: RePEc:boj:bojwps:02-e-1i
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    References listed on IDEAS

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    Cited by:

    1. Suder, Gabriele & Liesch, Peter W. & Inomata, Satoshi & Mihailova, Irina & Meng, Bo, 2015. "The evolving geography of production hubs and regional value chains across East Asia: Trade in value-added," Journal of World Business, Elsevier, vol. 50(3), pages 404-416.
    2. Shafaeddin, Mehdi, 2008. "South-South Regionalism And Trade Cooperation In The Asia-Pacific Region," MPRA Paper 10886, University Library of Munich, Germany.
    3. Saleh Mothana Obadi, 2007. "Regionálna integrácia a intra-regionálny obchod: komparatívna analýza [Regional integration and intra-regional trade: a comparative analysis]," Politická ekonomie, Prague University of Economics and Business, vol. 2007(1), pages 41-59.
    4. Eva Ervani & Tri Widodo & Muhammad Edhie Purnawan, 2019. "Comparative Advantage and Trade Specialization of East Asian Countries: Do East Asian Countries Specialize on Product Groups with High Comparative Advantage?," International Business Research, Canadian Center of Science and Education, vol. 12(2), pages 113-134, February.
    5. Koike, Ryoji, 2004. "Japan's Foreign Direct Investment and Structural Changes in Japanese and East Asian Trade," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 22(3), pages 145-182, October.
    6. Takeo Nakamura & Toshiaki Shinohara, 2007. "External Aspects of East Asian Economies and Finance - in light of growing interest in regional integration -," Bank of Japan Research Papers 2007-01-19, Bank of Japan.

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