Vertical Intra-Industry Trade and Foreign Direct Investment between Japan and European Countries

Yoshida, Yushi; Leitão, Nuno Carlos; Faustino, Horácio C.

doi:10.1007/s11293-009-9192-8

Cited by 21 publications

(11 citation statements)

References 18 publications

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“…This is consistent with the theoretical expectation that vertical-type FDI complements, rather than substitutes for, trade in intermediate goods. Similar findings also emerged in Görg (2000), Blonigen (2001), Türkcan (2007) and Yoshida et al (2009). This is an important result as it supports the view that fragmentation plays a significant role in explaining the intra-firm trade in intermediate goods between different plants within the same MNE.…”

Section: Resultssupporting

confidence: 78%

Vertical Intra‐industry Trade and Fragmentation: An Empirical Examination of the US Auto‐parts Industry

Türkcan

Ates

2011

World Economy

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The global auto industry has undergone a significant structural transformation in the last two decades as a result of the international fragmentation of production. This increase in cross‐border production‐sharing activities in the auto industry led to intra‐industry trade (IIT) in auto‐parts. In this study, the extent of IIT in the US auto‐parts industry is examined by decomposing trade into inter‐industry trade, vertical IIT and horizontal IIT. Then the development of vertical IIT is analysed as an indicator of international fragmentation between the US and 29 trading partners. Several country‐specific hypotheses suggested by the fragmentation literature are tested for the period 1989–2006. The results indicate that a substantial portion of IIT in the US auto‐parts industry is vertical IIT, and the econometric results generally support the hypotheses drawn from the theory. In particular, the findings show that the extent of the US vertical IIT is positively correlated with average market size, differences in market size, differences in factor endowments and outward foreign direct investment, while it is negatively correlated with distance and differences in per capita GDP.

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Section: Resultssupporting

confidence: 78%

Vertical Intra‐industry Trade and Fragmentation: An Empirical Examination of the US Auto‐parts Industry

Türkcan

Ates

2011

World Economy

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“…Industries with the highest contribution to the intra-industry trade in the Visegrad region (telecommunication equipment, electrical machinery, paper manufactures, organic chemicals, and transport equipment) are also the industries which have some of the highest share of FDI. This is in line with the results of previous research in this field, which show that there is a significant positive relationship between vertical intra-industry trade and FDI (Yoshida et al 2009) and support the low-labour-cost hypothesis. As expected, the lowest intra-industry trade can be observed in the industries linked to natural resources such as petroleum, natural gas or coal.…”

Section: Intra-industry Trade In the Visegrad Regionsupporting

confidence: 92%

Intra-industry trade in the Visegrad countries: Does the linder hypothesis hold?

Grančay

Vveinhardt

2016

Acta Oeconomica

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In 1961, Staffan Linder attacked mainstream trade economics by diverging from the generally accepted factor endowments theory and focusing on alternative explanations of why countries trade with each other. He was among the first economists to recognise the growing importance of intraindustry trade and presented his hypothesis that the more similar the per capita income levels of countries, the more they tend to trade with each other. This observation has since become one of the main pillars of modern trade theory. The present paper assesses the empirical validity of the Linder hypothesis in the Visegrad countries. Using a variant of the gravity model, it finds that when controlling for other factors, the Visegrad countries tend to trade more with countries with similar per capita income levels than with significantly richer or poorer countries. This observation is consistent with the Linder hypothesis. OLS regressions, Tobit regressions, and robustness checks all support the hypothesis.

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“…However, the literature does not always support this argument. On the one hand, Yoshida (2009) analysed VIIT and FDI between Japan and the EU and found a positive relationship, but Török and Jám-bor (2013) found a negative impact of FDI on VIIT. These data also come from WDI.…”

Section: H3: Vertical Product Differentiation (Vpd) Encourages (Discomentioning

confidence: 99%

Country- and industry-specific determinants of intra-industry trade in agri-food products in the Visegrad countries

Jámbor¹

2015

Stud. Agr. Econ.

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The article analyses country-and industry-specifi c determinants of horizontal and vertical intra-industry trade (IIT) in agri-food products between the Visegrad countries (Czech Republic, Hungary, Poland and Slovak Republic) and the European Union in the period 1999-2013. The results show that IIT is mainly of a vertical nature in the Visegrad countries, though the majority of their exports consist of low quality/value-added agri-food products to European markets. The results obtained by generalised method of moments (GMM) panel model estimations suggest that factor endowments and distance are mainly negatively related to IIT, while product differentiation was found not to foster two-way trade of quality-differentiated goods. All model runs show a negative relationship between productivity as well as foreign direct investment and IIT.

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Vertical Intra-Industry Trade and Foreign Direct Investment between Japan and European Countries

Abstract: Foreign direct investments, Fragmentation, Japan-Europe, Quality, Vertical intra-industry trade, F14,

Cited by 21 publications

References 18 publications

Vertical Intra‐industry Trade and Fragmentation: An Empirical Examination of the US Auto‐parts Industry

Vertical Intra‐industry Trade and Fragmentation: An Empirical Examination of the US Auto‐parts Industry

Intra-industry trade in the Visegrad countries: Does the linder hypothesis hold?

Country- and industry-specific determinants of intra-industry trade in agri-food products in the Visegrad countries

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