Patterns of Trade, Comparative Advantage and Productivity in the ASEAN-China-India Region

Abstract:     
This paper first investigates the pattern of trade and industrial productivity in the ASEAN, China, and India (ACI). By using highly disaggregated COMTRADE data during 1998-2008, I find that the ACI countries exhibit significant productivity growth in manufacturing sectors. Both international trade and intra-region trade in the ACI countries increase dramatically in the last decade. The imports from India to China are mostly ordinary trade whereas those from ASEAN to China are mostly processing trade. A further intensive empirical research shows that an exporter in the ACI region with higher productivity would export more to the rest of the world. Moreover, a more capital-abundant exporter in the ACI region would export more capital-intensive products to the rest of the world. Finally, policy suggestions for each ACI country are delivered based on the calculated revealed comparative advantage (RCA) index by industry and by year.

Number of Pages in PDF File: 35

Keywords: Productivity, Intra-region Trade, Comparative Advantage, Bilateral Trade

JEL Classification: F10, F11, F12

working papers series