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Growth and Pattern of Intra-Industry Trade between India and Bangladesh: 1975–2010

Author

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  • Kumar, Sushil
  • Ahmed, Shahid

Abstract

The present study investigates the intra-industry trade between India and Bangladesh over the period of 1975 to 2010. GL index is used to calculate intra-industry trade at the three-digit level of SITC. The study also calculated the trade complementarity index, and revealed comparative index. The extent of intra-industry trade is high in sectors like crude materials, inedible, except fuels, food and live animals. The study also reveals mismatch between Indian imports and Bangladesh exports. The present study indicates positive effect on consumer surplus and trade using SMART model. Finally, the paper suggests that Bangladesh should diversify his export structure to reduce the bilateral trade deficit on the basis of comparative advantage.

Suggested Citation

  • Kumar, Sushil & Ahmed, Shahid, 2014. "Growth and Pattern of Intra-Industry Trade between India and Bangladesh: 1975–2010," MPRA Paper 61113, University Library of Munich, Germany, revised 29 Dec 2014.
    • Handle: RePEc:pra:mprapa:61113
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    References listed on IDEAS

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    11. Yeats, Alexander J., 1998. "Just how big is global production sharing?," Policy Research Working Paper Series 1871, The World Bank.
    12. De, Prabir & Raihan, Selim & Kathuria, Sanjay, 2012. "Unlocking Bangladesh-India trade : emerging potential and the way forward," Policy Research Working Paper Series 6155, The World Bank.
    13. Akhtar Hossain & Rizwana Salim Rashid, 1999. "The Political Economy of Bangladesh's Large and Growing Trade Deficits with India," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 38(1), pages 25-68.
    14. Lancaster, Kelvin, 1980. "Intra-industry trade under perfect monopolistic competition," Journal of International Economics, Elsevier, vol. 10(2), pages 151-175, May.
    15. P. J. Verdoorn, 1960. "The Intra-Bloc Trade of Benelux," International Economic Association Series, in: E. A. G. Robinson (ed.), Economic Consequences of the Size of Nations, chapter 0, pages 291-329, Palgrave Macmillan.
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    Cited by:

    1. Aggarwal, Sakshi & Chakraborty, Debashis, 2017. "Determinants of India’s Bilateral Intra-Industry Trade over 2001-15: Empirical Results," MPRA Paper 78020, University Library of Munich, Germany.
    2. Aggarwal, Sakshi, 2023. "Intra-industry trade: Revisiting theory and Literature Survey," MPRA Paper 117182, University Library of Munich, Germany.
    3. Sakshi Aggarwal & Debashis Chakraborty, 2017. "Determinants of India’s Bilateral Intra-industry Trade over 2001–2015," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 18(2), pages 296-313, September.
    4. Aggarwal, Sakshi, 2023. "The empirical measurement and determinants of intra-industry trade for a developing country," MPRA Paper 117112, University Library of Munich, Germany.
    5. Anisul M. Islam, 2018. "Inter- and Intra-industry Trade Relations between Bangladesh and India: Empirical Results," FIIB Business Review, , vol. 7(4), pages 280-292, December.
    6. Sakshi Aggarwal & Debashis Chakraborty, 2022. "Which Factors Influence India’s Intra-Industry Trade? Empirical Findings for Select Sectors," Global Business Review, International Management Institute, vol. 23(3), pages 729-755, June.

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    More about this item

    Keywords

    Grubel Lloyd index; trade complementarity index; SMART model; economic regionalism;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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