Formation of production networks in ASEAN: Measuring the real value-added and identifying the role of ASEAN countries in the world supply chains
Journal Title: Business and Economic Horizons - Year 2017, Vol 13, Issue 2
Abstract
This study addresses the two-fold question of whether the integration-liberalization process of ASEAN is headed towards the creation of a single production base region, and how ASEAN links with other trade blocks. It looks into the degree of intra-ASEAN and extra-ASEAN vertical integration vis-à-vis North America, East Asia, and the European Union through the measurement of value-added creation-absorption in global value chains (GVC) and by locating ASEAN within vertical structures. The study employs an international input-output database and breaks up gross exports into different components of value-added using data from 1997, 2004, and 2012. ASEAN has made significant gains in integrating with East Asia. However, ASEAN as a single production region has gained little, and even lost share in value-added trade with NAFTA and Europe. The truth is that ASEAN has a stronger role across the GVC as a supplier of intermediate goods (33%) than as a supplier of final goods (30%). Vertical structures represent more than 43% of ASEAN gross exports, but it still depends on foreign parts and components (35%) to produce its exports. It may be argued that ASEAN 6, which entails a wider scope of integration, might offer larger benefits to the ASEAN project.
Authors and Affiliations
Miguel Angel Esquivias Padilla, Dyah Wulan Sari, Rossanto Dwi Handoyo
Keywords
Related Articles
- EP ID EP450422
- DOI 10.15208/beh.2017.18
- Views 131
- Downloads 0
Examining the dimensions of governance that are relevant for private investment
Which types of governance indicators matter the most for private investment? This short paper answers the question by examining the impact of specific governance indicators on private investment in a cross-section of dev...
Does foreign direct investment reduce poverty? The case of Latin America in the twenty-first century
Over the last decades, foreign direct investment flows to Latin America have grown dramatically. Yet, there is no consensus on whether the region has actually benefited from such trend or not. Specifically, regarding the...
Do tax incentives matter for investment? A literature review
The effectiveness of tax incentives in attracting FDI remains one of the unsettled concepts in public finance. The importance of tax incentives in attraction of internationally mobile capital differs with the jurisdictio...
A study of elderly welfare by comparing private and public retirement homes: A case study in Bangkok
This study assessed the subjective well-being (SWB), or welfare, of the elderly in retirement homes in Bangkok, and examined related factors, particularly from the perspective of happiness economics, since the empirical...
Applying Benford's law into Jordanian insurance companies to identify earning's manipulations
This study applies Benford’s law to examine the manipulations in revenue and earnings of a 25 insurance companies listed in Amman stock exchange from 2010 to 2015. These companies have been divided into two groups: (i) c...