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Article
Publication date: 28 June 2013

Hiroyuki Taguchi

The purpose of this paper is to examine the extent of the trade integration of Thailand with the Mekong region in comparison with its trade integration with the other major…

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Abstract

Purpose

The purpose of this paper is to examine the extent of the trade integration of Thailand with the Mekong region in comparison with its trade integration with the other major partners (advanced ASEAN, China, India, Japan, and the USA).

Design/methodology/approach

The study adopts the gravity trade model as an analytical framework, for the period from the 1980s through the 2000s.

Findings

It is found that Thailand's trade integration with the Mekong region has remarkably grown from the 1980s to the 2000s, in the sense that Thailand's total trade with the Mekong region, which lies below the gravity‐model standard in the 1980s, exceeds the standard in the 1990s and the 2000s. However, it is also found that the intensity of Thailand's trade integration with the Mekong region is still behind that with advanced ASEAN even in the 2000s. It might come from the higher service‐link costs that prevent the Mekong region from being fully involved in the international production network.

Originality/value

The paper may be valuable to the policy makers and researchers in the Mekong region, since it contributes to reviewing the two‐decade progress of the regional cooperation of the Greater Mekong Subregion from such quantitative perspectives as trade integration.

Details

International Journal of Development Issues, vol. 12 no. 2
Type: Research Article
ISSN: 1446-8956

Keywords

Article
Publication date: 1 April 2003

Georgios I. Zekos

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some…

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Abstract

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

Details

Managerial Law, vol. 45 no. 1/2
Type: Research Article
ISSN: 0309-0558

Keywords

Open Access
Article
Publication date: 6 November 2023

Thabo J. Gopane

This study examines the impact of regional economic integration (REI) on stock market linkages in the BRICS (Brazil, Russia, India, China and South Africa) economic bloc. In this…

Abstract

Purpose

This study examines the impact of regional economic integration (REI) on stock market linkages in the BRICS (Brazil, Russia, India, China and South Africa) economic bloc. In this type of study, the BRICS framework is an appealing empirical case, given its uncommon characteristics. For example, BRICS member states come from remote geographic locations (Africa, Asia, Europe and South America) and have contrasting socioeconomic profiles.

Design/methodology/approach

An empirical design is framed from the perspective of bilateral trade between South Africa and BRIC. The author accepts trade intensity as a proxy of regional economic integration and then examines the resulting effect on the stock market co-movement within BRIC. The study applies a two-step econometric procedure of the BEKK-MGARCH and panel data models.

Findings

Overall, bilateral trade, as a proxy of economic inwctegration, is associated with an increase in stock market integration. This positive relationship is particularly observed during episodes of surplus trade, and more interestingly, was initiated three years after BRICS’ existence and continues to grow at an increasing rate.

Practical implications

The study outcome should benefit international trade practitioners and global investors interested in portfolio diversification or concerned with risk spillovers.

Originality/value

First, notwithstanding South Africa's significant economic presence in the African continent, to the best of the author’s knowledge, this is the first study to empirically evaluate the BRICS economic integration on their stock market linkages from the perspective of South Africa. The value of this contribution is that further work may investigate the bidirectional spillover impact conveyed by South Africa's trade interactions within the juxtaposition of Africa and BRICS economies. Second, given that research on REI and stock market integration has historically concentrated on mature regional blocs of Europe, Asia, South and North America, the current study advances knowledge while correcting the prevailing literature imbalance.

Details

Journal of Economics, Finance and Administrative Science, vol. 28 no. 56
Type: Research Article
ISSN: 2077-1886

Keywords

Article
Publication date: 20 June 2008

Amzad Hossain Kamal Naser

The purpose of this paper is to analyze the effectiveness of the GCC integration.

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Abstract

Purpose

The purpose of this paper is to analyze the effectiveness of the GCC integration.

Design/methodology/approach

Both descriptive and comparative analyses are used. In order to measure the effectiveness, indicators like trends of trade, FDI inflows, joint venture project activities and technology diffusion are considered.

Findings

The analyses revealed that the Gulf Cooperation Council (GCC) regularly reviews the collective process of all the proposals to be executed. It also conducts an in‐depth analysis of all issues concerning the GCC states and their societies. The analyses also showed increasing trends in exports and imports, and high‐tech manufacturing after implementing customs union. In the same fashion, the number of joint venture projects, total capital investment and capital investment per project increase dramatically after executing customs union. The analysis further shows that the investment in large‐scale joint venture projects increases during the same period. The paper finds a sharp increase in FDI during the period between 2001 and 2004; within this period, the customs union has been implemented. This increased FDI is mainly due to the fact that the GCC attains enlarged domestic market size and stable economic growth after the GCC integration. The GCC integration also contributes to improve the push and pull factors of FDI that have further attracted increased FDI. The paper shows that the GCC countries have adapted and deployed new technology considerably quickly during the period 1999 to 2005 compared with the 1990s.

Practical implications

The study noticed improvements in all indicators as well as the push and pull factors that enhance effectiveness of the GCC integration. To attain more effective regional integration, a periodic review of all the issues concerning the GCC states and their societies in light of the advancement taking place in the Arab world and international arenas is vital.

Originality/value

The study finds that the effectiveness of the GCC integration is progressive. The integrators that measure effectiveness such as trends of trade, FDI inflows, joint venture project activities and technology diffusion show increasing trends.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 1 no. 2
Type: Research Article
ISSN: 1753-8394

Keywords

Article
Publication date: 5 March 2018

Jong Kyou Jeon

The purpose of this paper is to examine the relationship between trade integration and intra-regional business cycle synchronization using value-added trade data. Most empirical…

Abstract

Purpose

The purpose of this paper is to examine the relationship between trade integration and intra-regional business cycle synchronization using value-added trade data. Most empirical studies analyzing the relationship between trade integration and business cycle synchronization use gross trade data which suffer from double-counting. Double-counting distorts the empirical results on the estimated relationship between trade integration and business cycle synchronization. This paper explores the relationship using value-added trade data to be free from distortions caused by double-counting.

Design/methodology/approach

Gross trade data on exports and imports are decomposed into sub-categories following Koopman et al. (2014). Then, value-added data on exports and imports without double-counted terms are built to measure value-added bilateral trade intensity and value-added intra-industry trade intensity. Using this value-added trade intensities, the author run panel regressions for Europe and East Asian countries to examine how value-added trade intensities are correlated with output co-movements.

Findings

The paper finds that for European countries, the positive association between trade and business cycle co-movements is more evidently observed and the role of intra-industry trade increasing the business cycle synchronization is also more clearly revealed by value-added trade data. On the other hand, for East Asian countries, value-added trade data reveal that it is very uncertain whether increased trade contributes to stronger synchronization of business cycles and intra-industry trade is truly the major factor which deepens the business cycle co-movements.

Research limitations/implications

First, the paper examines the relationship only by running static panel regression. There is a need to employ different methodologies such as instrumental variable regression or dynamic panel regression. Second, financial integration and policy coordination within a region are also other relevant factors which influence the intra-regional business cycle synchronization. There is a need to examine the relationship using value-added trade data with the variables measuring the degree of financial integration and policy coordination. Third, value-added trade data used in this paper has limited coverage of East Asian countries. There is also a need to extend the value-added data set to cover more countries and industries.

Originality/value

Most empirical literature studying the relationship between trade integration and business cycle synchronization rely on gross trade data. This paper would be the first attempt to study the relationship using value-added trade data. Duval et al. (2014) also use value-added data, but their value-added data are not supported by a solid accounting framework which decomposes a country’s gross exports into various value-added components by source and additional double-counted terms. Value-added data in this paper computed based on Koopman et al. (2014) are the total domestic value exports that are ultimately consumed abroad via final and intermediate exports. The author believes that value-added data in this paper are most relevant in estimating the relationship between trade integration and business cycle synchronization.

Details

Journal of Korea Trade, vol. 22 no. 1
Type: Research Article
ISSN: 1229-828X

Keywords

Open Access
Article
Publication date: 31 December 2009

Andrew Elek

Economic integration in the 21st century is driven largely by market signals, rather than by inter-governmental trading arrangements. It also means much more than “free trade.”…

Abstract

Economic integration in the 21st century is driven largely by market signals, rather than by inter-governmental trading arrangements. It also means much more than “free trade.” Integration needs to consider all of the ways economies are connected in international markets, including trade in goods, services ideas and information, along with essential and complementary international movements of people and capital.

Except for a small number of sensitive products, especially in agriculture, most goods and services face no, or very low, formal trade barriers. Reducing border protection of the remaining sensitive products will certainly require negotiations, but they are no longer the most strategic obstacles to economic integration.

These days, the problems of most concern of those engaged in international commerce are logistics, communications, coping with security concerns and with different regulations in other economies. The effective constraint to designing and implementing cooperative arrangements to reduce such costs or risks of international commerce is the capacity to do so, rather than political resistance. Inter-governmental negotiations are not always necessary to deal with these practical issues.

Therefore, it should be possible to have a logical division of effort between APEC and the WTO in the Asia Pacific with the WTO dealing with those issues that do need to be negotiated; and APEC dealing with the many other issues where negotiations are not needed. In the longer term, an efficient division of labour could also emerge between the G20 and the WTO.

Details

Journal of International Logistics and Trade, vol. 7 no. 2
Type: Research Article
ISSN: 1738-2122

Keywords

Article
Publication date: 27 May 2014

Soumyananda Dinda

The aim of this paper was to focus on China’s economic integration with Asia region and the world. It also attempts to find the long-run relation with short-run dynamics of…

Abstract

Purpose

The aim of this paper was to focus on China’s economic integration with Asia region and the world. It also attempts to find the long-run relation with short-run dynamics of China’s trade in Asia and the world.

Design/methodology/approach

The augmented Dickey–Fuller and Phillips–Perron methods are applied to test the time-series properties of the variables. Co-integration technique is used to detect the economic integration of China’s export to the USA and its import from Asian nations using monthly aggregate data from December 2005 to July 2010.

Findings

This study observed that empirically China’s export to the USA depends on exchange rate and China’s import from Asia depends on China’s export to the USA. China has double role in international trade – China acts as an attractor of all inputs from Asia, and China exports the final products in international market. This study also reveals that the speed of China’s import from Asia is faster than that of China’s export to the USA.

Research limitations/implications

This study has some limitation in terms of data availability, and choice of methodology like the Gravity model

Practical implications

The results imply that China’s trade should be treated as an engine of growth in the Asian developing countries and the trade promotion policies should be encouraged. The emerging China will create other opportunities through trade integration with Asia and the world.

Social implications

These empirical findings will help policy-makers formulate their policy and design the mechanism for application as per their targets.

Originality/value

China is economically integrated with the region and the world. The paper contributes to measure the speed of China’s export and import in short run within Asia and the world. These empirical findings will help policy-makers to formulate their policy and design the mechanism for application as per their targets.

Details

Journal of Chinese Economic and Foreign Trade Studies, vol. 7 no. 2
Type: Research Article
ISSN: 1754-4408

Keywords

Article
Publication date: 15 December 2020

Alexis Habiyaremye and Veysel Avsar

This study investigates the impact of trade integration on payment choice in international transactions using data from Turkey, an emerging economy that signed many trade…

Abstract

Purpose

This study investigates the impact of trade integration on payment choice in international transactions using data from Turkey, an emerging economy that signed many trade agreements in the last two decades.

Design/methodology/approach

The authors use industry-level trade finance data from Turkey, which reports payment methods in exports at two-digit ISIC level for 180 export destinations. The authors performed linear as well as maximum likelihood techniques to test our hypothesis.

Findings

The authors show that the removal of trade barriers by bilateral free trade agreements leads to more exporter-financed transactions. This implies that lowering trade barriers contributes to reducing risk, which leads to more trade finance by exporters.

Originality/value

Trade finance is the lifeblood of global trade. Although the previous literature have analyzed the institutional and financial factors affecting exporters' decision to extend trade credit, the effect of economic integration has been overlooked. In this regard, this study represents the first attempt to analyze the impact of trade integration on trade finance.

Details

International Journal of Emerging Markets, vol. 17 no. 5
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 11 March 2011

Louise Curran and Soledad Zignago

This paper aims to exploit a new trade database to explore the extent to which trade, and the industrial division of labor which it represents, is regional in nature.

Abstract

Purpose

This paper aims to exploit a new trade database to explore the extent to which trade, and the industrial division of labor which it represents, is regional in nature.

Design/methodology/approach

The analysis focuses especially on intermediates trade, in three key regions – the EU, NAFTA and ASEAN+3 – which together represent 78 percent of global trade.

Findings

The results indicate that levels of regional integration in trade and changes in that integration vary by region and by direction of flow. Notably, the EU has higher levels of intra‐regional trade than the other two. These results vary by technology, with high‐tech trade less regionally biased than others.

Originality/value

Trade data has been little used in the debate on the regionalization of business activity. In addition, the paper highlights trends, not just in total trade, but within intermediate products and by technology.

Details

Multinational Business Review, vol. 19 no. 1
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 25 May 2023

Bereket Alemayehu Hagos

This paper aims to examine the road ahead for the African Continental Free Trade Area (AfCFTA), focusing on its potential opportunities and challenges. It is intended to help the…

Abstract

Purpose

This paper aims to examine the road ahead for the African Continental Free Trade Area (AfCFTA), focusing on its potential opportunities and challenges. It is intended to help the AfCFTA’s effective implementation by highlighting the major areas of intervention for State Parties.

Design/methodology/approach

The paper analyses relevant economic, political and legal research sources on regional integration in Africa and offers some personal views of the author to evaluate the past, present and future of the AfCFTA.

Findings

The paper shows that the AfCFTA can support its State Parties’ industrialization and diversification, better integrate micro-, small- and medium-sized enterprises (MSMEs) to regional value chains, create jobs, encourage sustainable investments and help its State Parties have common positions on global issues and achieve development. But, it also shows the challenges facing the AfCFTA, which include infrastructure gap, revenue and job losses, overlapping membership of State Parties in Regional Economic Communities, cumbersome customs systems, difficulty to cross African borders, fledgling MSMEs and inadequate technical capacity on trade policy. Accordingly, it recommends that State Parties continuously take various actions to address these challenges and maximize the multiple benefits of the AfCFTA.

Originality/value

The paper provides a comprehensive and up-to-date appraisal of the opportunities and challenges of the AfCFTA, both in the context of the history of regional integration in Africa and the recent global shocks that adversely impacted the continent (COVID-19 and the war in Ukraine).

Details

Journal of International Trade Law and Policy, vol. 22 no. 2
Type: Research Article
ISSN: 1477-0024

Keywords

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