2003 East Asian Seminar on Economics Focused on International Trade.The NBER's Fourteenth Annual East Asian Seminar on Economics (EASE), sponsored jointly with Hong Kong University of Science and Technology The Hong Kong University of Science and Technology (HKUST, or UST) was established in 1991 under Hong Kong Law Cap. 1141 (The Hong Kong University of Science and Technology Ordinance), as one of eight universities in Hong Kong. The current president is Professor Paul Ching-wu Chu. (HKU HKU University of Hong Kong
HKU Hogeschool voor de Kunsten Utrecht (Utrecht School of The Arts, The Netherlands)
HKU Hot Key Users ), Korea Development Institute The Korea Development Institute is an autonomous economic policy think tank that was set up by the Korean government. The Institute was founded in 1971, during a period of rapid growth, to provide academically rigorous research and analysis of economic policy decisions. (KDI KDI Knowledge and Distributed Intelligence (NSF)
KDI Korean Development Institute
KDI Kernel Debug Interface
KDI Kernel Downloadable Image (LynxOS)
KDI Kosovo Democratic Institute ), Tokyo Center for Economic Research (TCER), Chung-Hua Institution for Economic Research (CIER CIER Comisión de Integración Energética Regional (Montevideo, Uruguay - Regional Energetic Integration Commission)
CIER Centrul de Informare, Educare Si Resurse (Romania) ), and the Australian Productivity Commission, took place in Taipei, Taiwan on September 5-7. The organizers were NBER NBER National Bureau of Economic Research (Cambridge, MA)
NBER Nittany and Bald Eagle Railroad Company Research Associates Takatoshi Ito, of Tokyo University, and Andrew K. Rose, of University of California, Berkeley The University of California, Berkeley is a public research university located in Berkeley, California, United States. Commonly referred to as UC Berkeley, Berkeley and Cal . The following papers were discussed:
Kyoji Fukao, Hitotsubashi University, and Keiko Ito, ICSEAD, "Vertical Intra-Industry Trade and the Division of Labor in East Asia" Discussants: Chin Hee Hahn, KDI, and Ho-Mou Wu, National Taiwan University National Taiwan University (Traditional Chinese: 國立臺灣大學; Simplified Chinese: 国立台湾大学
Carolyn L. Evans, Federal Reserve Board, and James Harrigan, Federal Reserve Bank of New York The Bank of New York, abbrieviated to BNY, was a global financial services company that existed until its merger with the Mellon Financial Corporation on July 2, 2007. The bank now continues under the new name of The Bank of New York Mellon Corporation. , "Tight Clothing: How the MFA See multifactor authentication. Affects Asian Apparel Exports" Discussants: Leonard Cheng, HKU, and Philippa Dee, Australian Productivity Commission
Mitsuyo Ando and Fukunari Kimura, Keio University, "Unprecedented Formation of International Production/Distribution Networks in East Asia" Discussants: Hong Hwang, National Taiwan University, and Somkiat Tangkitvanich, Thailand Development Research Institute The Thailand Development Research Institute (TDRI) is a non-profit non-government Thai policy think tank focused social and economic development issues. The Institute has 6 major research programs: Human Resources and Social Development, International Economic Relations,
Chin Hee Hahn, "Exporting and Performance of Plants: Evidence on Korea" Discussants: Kyoji Fukao and James Harrigan
Shin-Horng Chen and Meng-Chun Liu, CIE (Commission Internationale de l'Eclairage, International Commission on Illumination, Vienna, Austria, www.cie.co.at) An international organization that sets standards for all aspects of lighting and illumination, including colorimetry, photometry and the measurement of visible and , "International R and D Deployment and Developing Countries' Locational Advantage: A Case Study of Taiwan" Discussants: Thomas J. Prusa, NBER and Rutgers University, and Somkiat Tangkitvanich
Philippa Dee and Jyothi Gali, Australian Productivity Commission, "The Trade and Investment Effects of Preferential Trading Arrangements" Discussants: Bih-Jane Liu, National Taiwan University, and Erlinda Medalla, Philippine Institute for Development Studies The Philippine Institute for Development Studies (PIDS) was created on September 26, 1977. PIDS was established to respond to the critical and growing need for research for planning and policy formulation.
Kozo Kiyota, Yokohama National University Yokohama National University (横浜国立大学 , and Shujiro Urata, Waseda University, "The Impacts of Free Trade Agreements on Foreign Trade in East Asia" Discussants: Dukgeun Ahn, KDI, and Erlinda Medalla
Deng-Shing Huang, Academia Sinica, "Trading Blocs in East Asia: Empirical Evidence from Gravity Models" Discussants: Keiko Ito and Andrew Rose
Leonard K. H. Cheng and Zihui Ma, HKU, "The Effects of Financial Crises on International Trade" Discussants: Chin Hee Hahn and Kozo Kiyota
Edgar Cudmore and John Whalley, NBER and University of Western Ontario Western is one of Canada's leading universities, ranked #1 in the Globe and Mail University Report Card 2005 for overall quality of education. It ranked #3 among medical-doctoral level universities according to Maclean's Magazine 2005 University Rankings. , "Border Delays and Trade Liberalization lib·er·al·ize
v. lib·er·al·ized, lib·er·al·iz·ing, lib·er·al·iz·es
To make liberal or more liberal: "Our standards of private conduct have been greatly liberalized . . . " (NBER Working Paper No. 9485) Discussants: Francis Lui, HKU, and Chong-Hyun Nam, Korea University
Tain-Jy Chen and Ying-Hua Ku, CIER, "The Effect of FDI FDI
See: Foreign direct investment on Domestic Employment" Discussants: Keiko Ito and Francis Lui
Thomas J. Prusa, "The Growing Problem of Antidumping an·ti·dump·ing
Intended to discourage importation and sale of foreign-made goods at prices substantially below domestic prices for the same items. Protection and What It Means for the Asia-Pacific Region" Discussants: Takatoshi Ito and Chong-Hyun Nam
Dukgeun Ahn, "WTO See World Trade Organization. Dispute Settlements in East Asia" Discussants: Da-Nien Liu, CIER, and John Whalley
Ito and Fukao investigate the deepening international division between labor and factor intensifies in Japan, focusing mainly on the manufacturing sector. First they analyze the factor contents of trade; they find that Japan's factor content of net-exports of capital and non-production labor grew rapidly, while its net-exports of production workers fell by a large amount. Interestingly, the decline in the factor content of net-exports of production workers was almost entirely caused by Japan's trade with China and Hong Kong. However, most of the macroeconomic mac·ro·ec·o·nom·ics
n. (used with a sing. verb)
The study of the overall aspects and workings of a national economy, such as income, output, and the interrelationship among diverse economic sectors. change in the capital-labor ratio and the skilled-labor ratio are attributable to a "within-industry" shift, rather than a "between industry" shift. The empirical analysis provides only weak evidence that the deepening international division of labor contributes to the change in factor intensifies in each industry. These results suggest that specialization in the export of skilled-labor-intensive products may have contributed to the increase in the relative demand for skilled (professional, technical, managerial, and administrative) labor within industry. However, at the same time, these results imply that changes in trade patterns (specialization in capital-intensive production) did not offset the excess supply of capital in Japan. That is, Japan is not specializing adequately in the export of capital-intensive goods, despite the fact that the price of capital is low and capital is abundant.
International trade in apparel and textiles is regulated by a system of bilateral tariffs and quotas known as the Multifiber Arrangement or MFA. Despite a long-standing interest in the effects of the MFA, Evans and Harrigan are the first researchers to assemble a time series of detailed product-level data from the United States on the quotas and tariffs that comprise the MFA. They analyze how the MFA affects the sources and prices of U.S. apparel imports, with a particular focus on the effects on East Asian exporters during the 1990s. They show that, while a large fraction of U.S. apparel is imported under binding quotas, there are many quotas that remain unfilled. They also show that binding quotas raise import prices substantially, suggesting both quality upgrading and rent capture by exporters. In contrast, tariffs reduce import prices. Finally, the authors argue that the substantial shift of U.S. apparel imports away from Asia in favor of Mexico and the Caribbean during the 1990s is due only partly to discriminatory trade policy: the other reason is an increasing demand for timely delivery that gives a competitive advantage to nearby exporters.
Ando and Kimura claim that the international production/distribution networks in East Asia are "unique," at least at this moment in time, in their significance in the regional economy, their geographical extensiveness involving a large number of countries in the region, and their sophistication so·phis·ti·cate
v. so·phis·ti·cat·ed, so·phis·ti·cat·ing, so·phis·ti·cates
1. To cause to become less natural, especially to make less naive and more worldly.
2. of both intra-firm and arm's length relationships across different nationalities. The authors begin by reviewing crucial changes in the policy framework in the developing East Asian countries a decade ago, and then sketching the theory behind the mechanics of international production/distribution networks. In the empirical part of the paper, the authors analyze overall trade patterns of the major East Asian countries in order to confirm the importance of international trade to machinery parts and components. Then they examine the micro data on Japanese corporate firms to look closely at the nature of networks through the pattern of FDI. The authors also quantify the magnitude of economic activities of Japanese firms through different channels of transactions, using the firm nationality approach.
Using the annual plant level panel data on Korean manufacturing during 1990 to 1998, Hahn examines the relationship between exporting and various performance measures, including total factor productivity. In particular, he asks whether exporting improves productivity (learning) and whether more productive plants export (self-selection). The evidence supports both self-selection and learning-by-exporting effects, although the latter seems only short-lived. Both effects have a role in explaining positive cross sectional correlations between exporting and TFE TFE Tetrafluoroethylene
TFE Travail de Fin d'Études (Belgium)
TFE Totalfinaelf (Oil and Gas)
TFE Thin Film Electronics
TFE 2,2,2-Trifluoroethanol Similar effects are observed when shipments or employment is considered as the performance measure. These results are broadly in line with previous studies on other countries, but contrast sharply with Aw, Chung, and Roberts (2000) who do not find any strong evidence of self-selection or learning in Korea. Hahn suggests that the benefits from exporting have been realized not only through resource reallocation Noun 1. reallocation - a share that has been allocated again
allocation, allotment - a share set aside for a specific purpose
2. reallocation channel but also via the TFP TFP Total Factor Productivity
TFP Tradition, Family and Property
TFP Time for Prints
TFP Transference-Focused Psychotherapy
TFP Trade for Prints (modeling)
TfP Training for Peace (South Africa) channel.
Liu and Chen examine the R and D internationalization The support for monetary values, time and date for countries around the world. It also embraces the use of native characters and symbols in the different alphabets. See localization, i18n, Unicode and IDN.
internationalization - internationalisation of a newly industrializing country--Taiwan being a prime example--with a special focus on the factors underlying locational advantage for attracting multinationals' offshore R and D. They begin with an examination of the literature on R and D internationalization and globalization globalization
Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation , emphasizing the significance of "first-tier supplier advantage" in the Taiwanese context. The authors take advantage of an official database to reveal the patterns of foreign corporate R and D in Taiwan and to examine the determinants of foreign affiliates' R and D intensities at the industrial level. The empirical results show that foreign affiliates in Taiwan with a higher R and D-intensity tend to be more export-oriented, localized in Taiwan in terms of sourcing of materials and capital goods, and to belong to sectors with a larger pool of the R and D labor force.
Dee and Gali quantify the impact of traditional and "new age" provisions of preferential trading arrangements (PTAs) on merchandise trade and investment. The), estimate gravity models of bilateral trade and investment and find that recent and some past PTAs are not as benign as some contemporary empirical assessments have suggested. A careful consideration of the analytical issues--including controlling comprehensively for other observable and unobservable factors, and resting explicitly for whether the trade and investment effects are significantly different after PTA PTA or parent-teacher association: see parent education. formation than before--accounts for the less favorable findings in this study. It is also possible for PTAs to have adverse effects on investment flows. If investment responds in "beachhead" fashion to the trade provision of PTAs, then the trade carried out from those beachheads could constitute traditional trade diversion. The investment provisions of PTAs also could create investment diversion. However, Dee and Gali find little evidence of beachhead investment, but rather of net investment creation in response to the "new age," non-trade provisions of PTAs. Thus, the finding on investment is more positive than for trade, but not without qualifications.
Urata and Kiyota examine the impact of East Asia Free Trade Area (FTA FTA
Future Teachers of America ) on trade patterns in East Asia. They use a multi-sector computable general equilibrium Computable general equilibrium (CGE) models are a class of economic model that use actual economic data to estimate how an economy might react to changes in policy, technology or other external factors. model and a data base developed by Hurtle hur·tle
v. hur·tled, hur·tling, hur·tles
To move with or as if with great speed and a rushing noise: an express train that hurtled past.
v.tr. (1997) and his colleagues at Purdue University. There are four major findings in this paper. First, the impacts of FTA on GDP GDP (guanosine diphosphate): see guanine. and the welfare of member countries are generally positive. Second, and surprisingly, an East Asia FTA does not seem to affect the pat terns of comparative advantage or intra-industry trade very much. Third, one would expect that output would decline for the protected sectors as a result of FTA, but that expectation is not really found. Finally, an East Asia FTA will promote regionalization regionalization Managed care The subdivision of a broadly available service–eg, a blood bank, into quasi-autonomous regional centers, capable of making decisions and providing more cost-effective and/or faster service to hospitals and health care facilities, in East Asia, but it will not necessarily promote regionalization in an Asian Free Trade Area.
Huang applies a gravity model in order to find empirical evidence on trading blocs in East Asia for the era following 1980. Special attention is paid to the role of openness on the part of mainland China in shaping East Asia's trade pattern. There is significant evidence of a trading bloc within a Chinese circle, including Taiwan, Hong Kong, and mainland China. Although the trade flows between Taiwan and mainland China were severely suppressed before 1987, the Chinese circle as a whole is highly integrated in terms of trade Terms of trade
The weighted average of a nation's export prices relative to its import prices. , indicating the important role that Hong Kong plays as a trading agent in the Chinese circle. The empirical results from after 1990 show that mainland China's openness in trade is empirically supported. On the other hand, East Asia as a whole is fostering a trading bloc, in the empirical sense.
Ma and Cheng study the effects of financial crises on international trade, both theoretically and empirically. Their major findings are that banking crises had a negative impact on imports but a positive impact on exports in the short term, whereas currency crises decreased both imports and exports in the short term but increased exports in the long term.
Delays at the border for customs clearance are seemingly a central feature of the trade regime in the CIS Cis (sĭs), same as Kish (1.)
(1) (CompuServe Information Service) See CompuServe.
(2) (Card Information S states. Cudmore and Whalley argue that, with queuing costs being determined endogenously in such circumstances, tariff liberalization (even in the small economy case) can worsen welfare, since tariff revenues are replaced by resource-using queuing costs. On the other hand, corruption can improve welfare if queuing costs are replaced by resource-transferring bribes. The authors also show how added distortions between perishable and non-perishable, or between light and heavy, goods also can arise. They show these outcomes using a simple general equilibrium model, and explore the numerical implications using Russian data. The orders of magnitude are both significant and opposite in sign to conventional analyses.
Chen and Ku study the effects of FDI on domestic employment by examining data on Taiwan's manufacturing industry. Treating domestic versus overseas production as two distinctive outputs from a joint production function, they first estimate the effect of overseas production on the demand for domestic labor. They find that overseas production generally reduces the demand for domestic labor as overseas products substitute for primary inputs in domestic production (substitution effect). But overseas production also allows the investor to expand domestic output through enhanced competitiveness. The expanded domestic output leads to more employment at home (output effect). The net effect of FDI on domestic employment is a combination of substitution and output effects. For Taiwan, the net effect is positive in most cases but it differs across groups. Technical workers tend to benefit most from FDI, followed by managerial workers, and blue-collar workers benefit the least; indeed they may even be adversely affected. This suggests that after FDI, a reconfiguration of the division of labor within a firm tends to shift domestic production toward technology and management-intensive operations.
Prusa examines trends in antidumping (AD) use with particular focus on the Asia-Pacific region, the traditional source for much of the rhetoric justifying AD actions. He shows that AD is the world's biggest trade impediment primarily because of its use by countries that previously did not use AD ("new" users). Twenty years ago, the top four users accounted for 98 percent of AD actions; nowadays these traditional AD users account for only about 40 percent of the disputes. After controlling for size, it becomes apparent that new users are filing at prodigious rates, five, ten, and even twenty." times the rate of the traditional users. The proliferation has not affected the propensity for Asia-Pacific countries to be targeted by AD actions. Over the past decade, Asia-Pacific countries are subject to over 40 percent of both new and traditional user AD actions. Interestingly, there are differences in the industry composition of trade complaints between new and traditional users. Traditional and new users both tend to target industries where they are losing comparative advantage. Since this pattern varies across countries, though, AD complaints differ across source countries. In other words Adv. 1. in other words - otherwise stated; "in other words, we are broke"
put differently , the pattern of AD use says as much about the filing country as it does about the target countries.
East Asian countries have become much more active in using the WTO dispute settlement system to assert their legal rights. The dispute settlement experience for these countries so far has shown a strong tendency of domestic governments to defend the economic interest of major industries. Their primary counterparts for trade disputes are still the major developed countries, including the United States and the European Communities. In some sense Thailand is peculiar in that it brought disproportionately many complaints to the WTO dispute settlement system while it was hardly challenged by other Members. In contrast to the GATT See General Agreement on Tariffs and Trade.
See General Agreement on Tariffs and Trade (GATT). era, Korea has become legally very aggressive under the WTO system. Ahn also notes that Japan rarely has been challenged since October 1998. Except for China, most East Asian countries lack the national procedure to link private economic interests to the WTO dispute settlement procedures. The next question for these Members may be how to establish a domestic system to properly represent their private economic interests in a more balanced manner and to make the WTO dispute settlement system a benign instrument for the entire economy, not a captive tool of a particular segment of industries.