[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/2697.html
   My bibliography  Save this paper

Regional integration and industrial growth among developing countries - the case of three ASEAN members

Author

Listed:
  • Madani, Dorsati H.
Abstract
Has the revival of the Association of Southeast Asian Nations (ASEAN) in the early 1990s affected the industrial growth of Indonesia, Malaysia, and the Philippines? The author uses two mechanisms to capture this potential impact: scale effects, and intermediate imports variety. She performs the analysis on twenty two industries (at the three-digit level of the International Standard Industrial Classification) over the period 1971-95. The results show significant heterogeneity in industry-level returns to scale. Moreover, the three ASEAN members have very small, mostly negative cross-industry scale effects. As a result, they may not achieve large, or across-the-board gains from their regional arrangement through scale effects. The author finds unexpected results with respect to the role of intermediate imports variety in industrial growth. She finds no support for the hypothesis that non-regional (rest of the world) suppliers, and goods variety have a positive effect on ASEAN industries through the channel of imported intermediate inputs. The regional variety measure, however, seems to have a positive effect on the output growth of a handful of industries. This result seems due to the fact that these countries have long had a strong intra-regional, and intra-industry trade, whose history predates, and outweighs the ASEAN revival.

Suggested Citation

  • Madani, Dorsati H., 2001. "Regional integration and industrial growth among developing countries - the case of three ASEAN members," Policy Research Working Paper Series 2697, The World Bank.
    • Handle: RePEc:wbk:wbrwps:2697
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2001/11/28/000094946_0111090402257/Rendered/PDF/multi0page.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sebastian Edwards, 1994. "Trade and Industrial Policy Reform in Latin America," NBER Working Papers 4772, National Bureau of Economic Research, Inc.
    2. Feenstra, Robert C & Markusen, James R, 1994. "Accounting for Growth with New Inputs," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 35(2), pages 429-447, May.
    3. Diwan, Ishac & Hoekman, Bernard, 1999. "Competition, Complementarity and Contagion in East Asia," CEPR Discussion Papers 2112, C.E.P.R. Discussion Papers.
    4. Coe, David T. & Helpman, Elhanan, 1995. "International R&D spillovers," European Economic Review, Elsevier, vol. 39(5), pages 859-887, May.
    5. Feenstra, Robert C, 1994. "New Product Varieties and the Measurement of International Prices," American Economic Review, American Economic Association, vol. 84(1), pages 157-177, March.
    6. Markusen, James R. & Venables, Anthony J., 1999. "Foreign direct investment as a catalyst for industrial development," European Economic Review, Elsevier, vol. 43(2), pages 335-356, February.
    7. Basu, Susanto & Fernald, John G., 1995. "Are apparent productive spillovers a figment of specification error?," Journal of Monetary Economics, Elsevier, vol. 36(1), pages 165-188, August.
    8. Casella, Alessandra, 1996. "Large countries, small countries and the enlargement of trade blocs," European Economic Review, Elsevier, vol. 40(2), pages 389-415, February.
    9. Harrison, Ann E., 1994. "Productivity, imperfect competition and trade reform : Theory and evidence," Journal of International Economics, Elsevier, vol. 36(1-2), pages 53-73, February.
    10. Peter Robson, 1993. "The New Regionalism and Developing Countries," Journal of Common Market Studies, Wiley Blackwell, vol. 31(3), pages 329-348, September.
    11. Francisco L. Rivera-Batiz & Luis A. Rivera-Batiz, 2018. "Economic Integration and Endogenous Growth," World Scientific Book Chapters, in: Francisco L Rivera-Batiz & Luis A Rivera-Batiz (ed.), International Trade, Capital Flows and Economic Development, chapter 1, pages 3-32, World Scientific Publishing Co. Pte. Ltd..
    12. Seghezza, Elena & Baldwin, Richard E., 2008. "Testing for Trade-Induced Investment-Led Growth," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 61(2-3), pages 507-537.
    13. Feenstra, Robert C. & Madani, Dorsati & Yang, Tzu-Han & Liang, Chi-Yuan, 1999. "Testing endogenous growth in South Korea and Taiwan," Journal of Development Economics, Elsevier, vol. 60(2), pages 317-341, December.
    14. Henrekson, Magnus & Torstensson, Johan & Torstensson, Rasha, 1997. "Growth effects of European integration," European Economic Review, Elsevier, vol. 41(8), pages 1537-1557, August.
    15. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    16. Richard E. Baldwin & Elena Seghezza, 1996. "Trade-Induced Investment-led Growth," NBER Working Papers 5582, National Bureau of Economic Research, Inc.
    17. Caballero, Ricardo J. & Lyons, Richard K., 1990. "Internal versus external economies in European industry," European Economic Review, Elsevier, vol. 34(4), pages 805-826, June.
    18. Puga, Diego & Venables, Anthony J, 1998. "Trading Arrangements and Industrial Development," The World Bank Economic Review, World Bank, vol. 12(2), pages 221-249, May.
    19. Caballero, Ricardo J. & Lyons, Richard K., 1992. "External effects in U.S. procyclical productivity," Journal of Monetary Economics, Elsevier, vol. 29(2), pages 209-225, April.
    20. Brada, Josef C & Mendez, Jose A, 1988. "An Estimate of the Dynamic Effects of Economic Integration," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 163-168, February.
    21. Jaime De Melo & Arvind Panagariya & Dani Rodrik, 2015. "The New Regionalism: A Country Perspective," World Scientific Book Chapters, in: Developing Countries in the World Economy, chapter 14, pages 323-357, World Scientific Publishing Co. Pte. Ltd..
    22. Baldwin, Richard E. & Venables, Anthony J., 1995. "Regional economic integration," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 31, pages 1597-1644, Elsevier.
    23. Hall, Robert E, 1988. "The Relation between Price and Marginal Cost in U.S. Industry," Journal of Political Economy, University of Chicago Press, vol. 96(5), pages 921-947, October.
    24. repec:fth:geneec:93.10 is not listed on IDEAS
    25. Cáceres, Luis René, 1994. "Central American integration: its costs and benefits," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    26. Madani, Dorsati H., 2001. "South-South regional integration and industrial growth : the case of the Andean Pact," Policy Research Working Paper Series 2614, The World Bank.
    27. Burnside, Craig, 1996. "Production function regressions, returns to scale, and externalities," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 177-201, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Robert J. R. Elliott & Kengo Ikemoto, 2004. "AFTA and the Asian Crisis: Help or Hindrance to ASEAN Intra‐Regional Trade?," Asian Economic Journal, East Asian Economic Association, vol. 18(1), pages 1-23, March.
    2. Fugazza, Marco & Robert-Nicoud, Frédéric, 2006. "Can South-South trade Liberalisation Stimulate North-South Trade ?," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 21, pages 234-253.
    3. Setyastuti, Rini & Adiningsih, Sri & Widodo, Tri, 2018. "The Dynamics of Comparative Advantage in the ASEAN Region," MPRA Paper 86541, University Library of Munich, Germany.
    4. Ming Qi & Jing Xu & Nnenna Bridget Amuji & Shumingrui Wang & Fengqian Xu & Huan Zhou, 2022. "The Nexus among Energy Consumption, Economic Growth and Trade Openness: Evidence from West Africa," Sustainability, MDPI, vol. 14(6), pages 1-22, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Madani, Dorsati H., 2001. "South-South regional integration and industrial growth : the case of the Andean Pact," Policy Research Working Paper Series 2614, The World Bank.
    2. Kee Hiau Looi, 2004. "Estimating Productivity When Primal and Dual TFP Accounting Fail: An Illustration Using Singapore's Industries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-40, October.
    3. Kutan, Ali M. & Yigit, Taner M., 2007. "European integration, productivity growth and real convergence," European Economic Review, Elsevier, vol. 51(6), pages 1370-1395, August.
    4. Brandt, Nicola, 2007. "Mark-ups, economies of scale and the role of knowledge spillovers in OECD industries," European Economic Review, Elsevier, vol. 51(7), pages 1708-1732, October.
    5. Broda, Christian & Greenfield, Joshua & Weinstein, David E., 2017. "From groundnuts to globalization: A structural estimate of trade and growth," Research in Economics, Elsevier, vol. 71(4), pages 759-783.
    6. Kee, Hiau Looi, 2002. "Markups, returns to scale, and productivity : a case study of Singapore's manufacturing sector," Policy Research Working Paper Series 2857, The World Bank.
    7. By Michael Funke & Ralf Ruhwedel, 2001. "Product Variety and Economic Growth: Empirical Evidence for the OECD Countries," IMF Staff Papers, Palgrave Macmillan, vol. 48(2), pages 1-1.
    8. Arjan Lejour & Vladimir Solanic & Paul Tang, 2009. "EU Accession and Income Growth: An Empirical Approach," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 16(1), pages 127-144, May.
    9. Colantone, Italo & Crinò, Rosario, 2014. "New imported inputs, new domestic products," Journal of International Economics, Elsevier, vol. 92(1), pages 147-165.
    10. repec:zbw:bofitp:2003_008 is not listed on IDEAS
    11. Pinelopi Koujianou Goldberg & Amit Kumar Khandelwal & Nina Pavcnik & Petia Topalova, 2010. "Imported Intermediate Inputs and Domestic Product Growth: Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(4), pages 1727-1767.
    12. Sharon G. Harrison, 2003. "Returns to Scale and Externalities in the Consumption and Investment Sectors," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 6(4), pages 963-976, October.
    13. Benhabib, Jess, 1998. "Introduction to Sunspots in Macroeconomics," Journal of Economic Theory, Elsevier, vol. 81(1), pages 1-6, July.
    14. Paolo Epifani, 2003. "Trade liberalization, Firm Performances and Labor Market Outcomes in the Developing World, what Can We Learn From Micro-Level Data?," Rivista italiana degli economisti, Società editrice il Mulino, issue 3, pages 455-486.
    15. Driver, Ciaran & Temple, Paul & Urga, Giovanni, 2006. "Identifying externalities in UK manufacturing using direct estimation of an average cost function," Economics Letters, Elsevier, vol. 92(2), pages 228-233, August.
    16. Paquet, Alain & Robidoux, Benoit, 2001. "Issues on the measurement of the Solow residual and the testing of its exogeneity: Evidence for Canada," Journal of Monetary Economics, Elsevier, vol. 47(3), pages 595-612, June.
    17. Richard Baldwin & Henrik Braconier & Rikard Forslid, 2005. "Multinationals, Endogenous Growth, and Technological Spillovers: Theory and Evidence," Review of International Economics, Wiley Blackwell, vol. 13(5), pages 945-963, November.
    18. Francesco Venturini & Ana Rincon-Aznar & Dr Michela Vecchi, 2013. "ICT as a general purpose technology: spillovers, absorptive capacity and productivity performance," National Institute of Economic and Social Research (NIESR) Discussion Papers 416, National Institute of Economic and Social Research.
    19. Feenstra, Robert C. & Madani, Dorsati & Yang, Tzu-Han & Liang, Chi-Yuan, 1999. "Testing endogenous growth in South Korea and Taiwan," Journal of Development Economics, Elsevier, vol. 60(2), pages 317-341, December.
    20. Rosina Moreno & Enrique López-Bazo & Esther Vayá & Manuel Artís, 2004. "External Effects and Cost of Production," Advances in Spatial Science, in: Luc Anselin & Raymond J. G. M. Florax & Sergio J. Rey (ed.), Advances in Spatial Econometrics, chapter 14, pages 297-317, Springer.
    21. Michael Funke & Ralf Ruhwedel, 2005. "Export variety and economic growth in East European transition economies," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 13(1), pages 25-50, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:2697. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Roula I. Yazigi (email available below). General contact details of provider: https://edirc.repec.org/data/dvewbus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.