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

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  • Yushi Yoshida
  • Hiro Ito
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.

Suggested Citation

  • Yushi Yoshida & Hiro Ito, 2006. "How Do the Asian Economies Compete With Japan in the US Market? Is China Exceptional? A Triangular Trade Approach," Asia Pacific Business Review, Taylor & Francis Journals, vol. 12(3), pages 285-307, July.
    • Handle: RePEc:taf:apbizr:v:12:y:2006:i:3:p:285-307
    DOI: 10.1080/13602380600601570
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    Cited by:

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    4. García-Mainar, Inmaculada & Montuenga-Gómez, Víctor M., 2009. "Education returns of wage earners and self-employed workers: Response," Economics of Education Review, Elsevier, vol. 28(5), pages 645-647, October.
    5. Thorbecke, Willem, 2008. "The effect of exchange rate volatility on fragmentation in East Asia: Evidence from the electronics industry," Journal of the Japanese and International Economies, Elsevier, vol. 22(4), pages 535-544, December.

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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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