Progress in Intra-industry Trade in the Greater Mekong Sub-region

Published date01 May 2016
AuthorKenji Nozaki
Date01 May 2016
DOI10.1177/0015732515625708
Subject MatterArticles
Progress in Intra-industry
Trade in the Greater
Mekong Sub-region
Kenji Nozaki1
Abstract
The Greater Mekong Sub-region (GMS) attracts investors’ interest today and
economic linkage in the GMS is strengthening with the creation of a production
network. This paper analyzes the division of labour in the production proc-
ess by industry. Two industrial sectors are chosen, the clothing industry and
automobile industry. Two types of analysis were conducted in this study: one
is a detailed analysis of trade figures, with calculation of the Grubel and Lloyd
indexes and unit trade value, and the other is the estimation of gravity model.
Their results are consistent. In the clothing sector, which is a labour-intensive
industry, intra-industry trades include items by both horizontal division of labour
and vertical division of labour. In contrast, the automobile sector does not exhibit
horizontal division of labour, and signs of vertical division of labour between
Thailand and Vietnam are observed. As different types of industry involve the
different types of production network, further research will be needed.
JEL: F14, F15, R11
Keywords
Intra-industry trade, division of labour, Greater Mekong Sub-region (GMS),
Grubel and Lloyd index, Gravity model
Introduction
The Greater Mekong Sub-region (GMS) comprises the countries of Cambodia,
Lao PDR, Myanmar, Thailand and Vietnam.1 Although they are at different stages
of development, the region as a whole attracts investors’ interest by various
means.
Foreign Trade Review
51(2) 147–161
©2016 Indian Institute of
Foreign Trade
SAGE Publications
sagepub.in/home.nav
DOI: 10.1177/0015732515625708
http://ftr.sagepub.com
Corresponding author:
Kenji Nozaki, 698, Azu Hanno-City, Saitama 357-8555, Japan.
E-mail: knozaki.kenji@gmail.com
1 Professor, Faculty of Economics and Management, Surugadai University, Hanno, Saitama, Japan.
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