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31. Learning-to-Export Effect as a Response to Export Opportunities: Micro-Evidence from Korean Manufacturing

Author:
Chin Hee Hahn and Yong-Seok Choi
Publication Date:
02-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This paper aims to investigate whether empirical evidence supports the learning-to-export hypothesis, which has received little attention in the previous literature. By taking full advantage of plant–product level data from the Republic of Korea during 1990–1998, we find some evidence for the learning-to-export effect, especially for innovated product varieties with delayed exporters: their productivity, together with research and development and investment activity, was superior to their matched sample. On the other hand, this learning-to-export effect was not significantly pronounced for the industries protected by import tariffs. Thus, our empirical findings suggest that it would be desirable to implement some policy tools to promote the learning-to-export effect, while tariff protection cannot be justifiable for that purpose.
Topic:
Industrial Policy, International Trade and Finance, Tariffs, Manufacturing, and Productivity
Political Geography:
Asia and South Korea

32. Improving Digital Connectivity For E-commerce: A Policy Framework and Empirical Note for ASEAN

Author:
Lurong Chen
Publication Date:
03-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Global cross-border e-commerce has become increasingly important in the international economy. The next Asian miracle of growth could be born out of the region's digital transformation. Digital connectivity is the cornerstone that will make change feasible and smoothen the transformation. Digital connectivity consists of not only physical connectivity that facilitates the movement of raw materials, intermediate goods, and goods, but also cyber connectivity to support free flows of data, information, and services. This paper proposes a policy framework of promoting digital connectivity to support the development of e-commerce. Policy efforts to improve data connectivity, logistics, and online payment can help the Association of Southeast Asian Nations narrow the development gaps in information and communications technology infrastructure, both cross-border and within countries. Improving institutional connectivity and service development play a significant role. Digital connectivity is essential for the digital-friendly ecosystem that will facilitate digital transformation, which will affect not only e-commerce but also countries’ overall economic performance.
Topic:
International Trade and Finance, Science and Technology, Digital Economy, and Connectivity
Political Geography:
ASEAN

33. Labour Market Impacts of Import Penetration from China and Regional Trade Agreement Partners: The Case of Japan

Author:
Kazunobu Hayakawa, Tadashi Ito, and Shujiro Urata
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
The impacts of imports on the domestic labour market have been hotly debated recently. The purpose of this paper is to empirically examine the effects of not only imports from China but also those under regional trade agreements (RTAs) on employment in Japan. As in previous studies in the literature, we found that the rise in import penetration from China significantly decreases employment in Japan. However, import penetration under RTA regimes is found to have insignificant effects on employment. The finding suggests that the increase in imports under RTA regimes might not be harmful to the domestic labour market. In addition, we did not find significant effects of import penetration via input–output linkages. This insignificant result may be because imports by Japanese manufacturing firms are mostly conducted in the form of intra-firm trade, enabling them to avoid negative impacts on employment.
Topic:
International Trade and Finance, Regional Cooperation, Labor Issues, Employment, and Manufacturing
Political Geography:
Japan, China, and Asia

34. Trade Reform and the Evolution of Agglomeration in Vietnamese Manufacturing

Author:
Đoàn Thi Thanh Ha and Hông Quỳnh Nguyen
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
It is well-documented that agglomeration contributes to productivity growth. However, concentrations of workers could also lead to increasing regional income disparities. Therefore, understanding the evolution of agglomeration is relevant for the formulation of industrial policy and inclusive growth. This study documents the extent, pattern, and determinants of agglomeration in Vietnamese manufacturing during 2002–2016, a period when substantial economic reform took place. Our major findings are three-fold. First, agglomeration, as measured by the Ellison–Glaeser index, has declined since the mid-2000s. Second, there exists significant sectoral heterogeneity in the level and trend of agglomeration. Third, we do not find a significant impact of trade and foreign direct investment on agglomeration per se. However, foreign direct investment in port districts does contribute to disagglomeration.
Topic:
International Trade and Finance, Reform, Manufacturing, and Productivity
Political Geography:
Asia and Vietnam

35. The Economic Impact of Globalisation in Indonesia

Author:
Kiki Verico and Mari Pangestu
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This paper analyses the economic impact of globalisation in Indonesia from the end of the 1960s to date. The analysis found that globalisation generated a positive impact on Indonesia’s economic growth through the trade and investment channel; reduced wage inequality and child labour participation; and increased labour absorption, including women's participation in the labour market. Through the trade channel, globalisation also contributed to Indonesia’s productivity and structural economic transformation, benefited small and medium-sized enterprises (SMEs), contributed to poverty alleviation and reduced inequality, and increased trade in services such as tourism. Through the investment channel, there is evidence of the spillover effect of technology transfer, technology progress, improvement of the role of SMEs, and contribution to poverty alleviation. The waves of open and more restrictive trade and investment policies, which Indonesia has gone through in the last few decades, reflect the political economy reality – that is, the impact of globalisation is dynamic and only felt in the medium term, whereas the cost and potential negative impact is often felt more immediately throughout trade creation. The trade creation increases imports from countries with which free trade agreements have been negotiated, decreasing the domestic producer surplus. Since globalisation will create net benefits in the long run, Indonesia should continue its process of globalisation and integration with the world economy to ensure the net benefits and to move forward in its structural transformation, while managing the costs of globalisation and its transition process.
Topic:
Globalization, International Cooperation, International Trade and Finance, and Economic growth
Political Geography:
Indonesia, Asia, and Indo-Pacific

36. COVID-19: Global Trade and Supply Chains after the Pandemic

Author:
David Ramirez
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
The COVID-19 outbreak has shaken international trade and supply chains to their very foundations. This paper presents possible trade and supply scenarios, examining in particular the future of China’s pre-COVID-19 role as ‘the world’s factory’. Although disruptions such as the Japan earthquake and tsunami of 2011 and the recent trade war between the United States and China have strained global trade and supply chains in the past, particularly in Asia, COVID-19 has had historically devastating effects. While high levels of uncertainty currently make it hard to foresee exactly how global trade and supply chains will look in the post-COVID-19 era, it is inevitable that they will be reshaped.
Topic:
International Trade and Finance, Public Health, Pandemic, and COVID-19
Political Geography:
Global Focus

37. China’s evolving nuclear 
export control regime

Author:
Xu Chunyang
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Center for International and Security Studies at Maryland (CISSM)
Abstract:
The Chinese nuclear industry is actively pursuing international trade under China’s new “Go Global” policy. This development could strain Chinese nuclear export control systems in the coming decades. This paper investigates the evolution of the Chinese nuclear export control regime from the late 1970s to the present, describes the current state of the Chinese export control system, and investigates recent Chinese efforts to build a more robust system. It finds that although the Chinese strategic export control systems have grown tremendously since they first took shape and the capacity of the government to implement these controls has grown as well, significant improvements in both the legal basis for the controls and the capacity of institutions involved are still needed, including in how current laws define exports, in how government bodies are equipped to investigate violations, and in how violations are prosecuted. The Ministry of the Commerce is preparing a new “Export Control Law” that is expected to come into effect soon and to provide the basis for more robust controls that address many of the deficiencies identified above. The Chinese government’s growing commitment to undertaking its international obligations and safeguarding the peaceful use of nuclear energy provides reason for optimism, but in the near term, the effectiveness of these corrective efforts will depend on the completion, implementation, and enforcement of the new law.
Topic:
Diplomacy, International Trade and Finance, and Nuclear Power
Political Geography:
China, Beijing, and Asia

38. Averting a Global Calamity? Trump and Xi at the G20

Author:
John Edwards
Publication Date:
06-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
The outlines of a trade deal between the United States and China are there. But without a return to the negotiating table, the dispute could rapidly escalate, magnifying the damage to world growth. With the Osaka G20 meeting looming, Chinese analysts and policymakers visited in Beijing are pessimistic about the prospects for a trade deal with the United States. If they are right, global financial markets are in for a much wilder shock than anything yet seen in this quarrel. Yet much of a deal has already been agreed, while the consequences of not reaching a deal have become increasingly dire.
Topic:
International Relations, International Trade and Finance, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

39. East Asia's Decoupling

Author:
Roland Rajah
Publication Date:
01-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
East Asia is no longer reliant on US or Western markets to fuel its growth, giving it more room to manage amid global trade tensions. Heightened global trade tensions and the US desire to ‘decouple’ from the Chinese economy for national security reasons pose significant risks to East Asia’s export-driven growth model. However, the latest data suggests East Asia is no longer so dependent on exporting to the West, with China in particular eclipsing the United States as the leading source of ‘final demand’ for the rest of the region’s exports. This gives East Asia much greater room to manoeuvre, as regional integration is now a more viable platform for growth while US decoupling efforts will likely struggle to find traction in the region.
Topic:
Economics, International Trade and Finance, Global Markets, and Exports
Political Geography:
China, East Asia, Asia, North America, and United States of America

40. Towards the future in the Three Seas Region

Author:
Izabela Albrycht
Publication Date:
02-2019
Content Type:
Working Paper
Institution:
Institute for Development and International Relations (IRMO)
Abstract:
Launched in 2016, the Three Seas Initiative (3SI) is designed to build cooperation and interconnectivity between 12 CEE countries through new cross-border infrastructures. The aim of the region’s political leaders is to leverage the economic growth to the extent in which it Kitarović, President of the Republic of Croatia at the Third 3SI Summit in 2018. She added: “substantial projects, such as energy supply corridors and communications infrastructure, as well as modernization of our economies through an extension of transportation links, will allow for the full integration of Central can contribute to the EU’s greater prosperity and at the same time tighten transatlantic bonds. Let us wish the 3S region yet another good year in which the 3S countries will see the materialisation of hopes”, stated Kolinda Grabar- Europe with the remainder of our continent. It will annul the artificial, but still lingering division between old and new, West and East Europe and it will most definitely contribute to a higher level of prosperity of Europe as a whole.”
Topic:
International Trade and Finance, Regional Cooperation, and Economic Cooperation
Political Geography:
Europe, Balkans, Croatia, and Central Europe