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How Does Industrialization Affect the Structure of International Trade? the Japanese Experience in the Pacific Basin, 1975-85
Author:
Sayuri Shirai null

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Series:
IMF Working Papers
Volume/Issue:
Volume 1994: Issue 095
Language:
English
Publication Date:
01 Aug 1994
DOI:
https://doi.org/10.5089/9781451851779.001
ISBN:
9781451851779
ISSN:
1018-5941
Pages:
40
Keywords:
WP; industry trade; developing country; intra-industry trade; manufactures aggregate; industry index; trade volume; IIT index; Manufacturing; Agricultural commodities; Industrialization; Exports; Imports; East Asia
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper provides a theoretical model to address the issue of how industrialization affects the structure of international trade. Considering both horizontal and vertical product differentiation, the model shows that intra-industry trade increases when product quality improvement emerges in a developing country and when a difference in relative factor endowments between a developed and a developing countries shrinks. To promote understanding of the conclusions of the model, the paper also uses actual trade data between Japan and Indonesia and between Japan and Korea.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund