How Do the Asian Economies Compete with Japan in the US Market? Is China Exceptional? A Triangular Trade Approach

Asia Pacific Business Review, Vol. 12, No. 3, pp. 285-307, 2006

Posted: 18 Apr 2011

See all articles by Yushi Yoshida

Yushi Yoshida

Shiga University - Economics; Kyushu Sangyo University

Hiro Ito

Portland State University - Department of Economics

Date Written: June 14, 2006

Abstract

We apply a trilateral trade approach to examine how Japanese exports and investment to China, or seven other Asian economies, affect Chinese, or the seven Asian economies’, exports to the US market. The results suggest that while Chinese and Japanese exports are directly competitive in US markets, Chinese exports to the US are supported partly by Japanese exports to China. The positive correlation between Japanese exports to China and Chinese exports to the US is explained by vertical trade between Japanese multinationals and their affiliates in China. Indonesian and Philippine exports are also competing with Japanese exports in US markets, though the extent of the competition is much higher for China than for these countries.

Keywords: China, Japanese FDI, Export-Platform FDI, Triangular Trade Approach

JEL Classification: F14, F23

Suggested Citation

Yoshida, Yushi and Ito, Hiro, How Do the Asian Economies Compete with Japan in the US Market? Is China Exceptional? A Triangular Trade Approach (June 14, 2006). Asia Pacific Business Review, Vol. 12, No. 3, pp. 285-307, 2006. Available at SSRN: https://ssrn.com/abstract=1810125

Yushi Yoshida (Contact Author)

Shiga University - Economics ( email )

Banba 1-1-1
Hikone, Shiga
Japan

Kyushu Sangyo University ( email )

2-3-1 Matsukadai, Higashi-ku
Fukuoka, 813-8503
Japan

Hiro Ito

Portland State University - Department of Economics ( email )

Portland, OR 97207-0751
United States
503-725-3930 (Phone)
503-725-3945 (Fax)

HOME PAGE: www.econ.pdx.edu

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