Intra-industry Specialization Research Articles

Development of chinese-brazilian agri-food trade

The article analyzes the Chinese-Brazilian trade in agri-food products. The importance and complementarity of bilateral trade flows are revealed; Brazil's growing inter- and intra-industry specialization in the supply of agricultural raw materials while maintaining a negative balance for the Chinese side. There was a significant lag between the net exporter and the importer in terms of the global food security index and the presence of a higher prevalence of malnutrition among the population. The decline in the already low share of agri-food products in total exports from China to Brazil is determined by the growth of domestic consumption of a variety of food products of domestic production and China's international specialization in the field of non-agricultural products with medium and high levels of added value. The main changes in tariff and non-tariff measures for regulating mutual trade have been identified. Emphasis is placed on the relationship between investment and trade policy of China, whose companies invest in the agro-industrial complex and infrastructure of Brazil in various forms, including international business mergers and acquisitions, construction from scratch, creation of joint ventures. The factors, risks and prospects of further development of the Sino-Brazilian agricultural trade are identified, taking into account the geopolitical effects of the possible substitution of large-scale purchases of soybeans from the United States with Brazilian supplies to China.

Research on China-EU equipment manufacturing Trade dependence in intra-industry specialization view.

As the foundation of the industrial economy, the equipment manufacturing industry takes an important position on the China-EU trade. Based on the analysis of the overall trend and structure of China-EU equipment manufacturing industry trade in 2007-2020, this article involves the construction of trade concentration into trade dependence metrics, and then calculate the degree of interdependence between China and EU equipment manufacturing trade in 2020. The perspective of the intra-industry specialization will be used to analyze China-EU equipment manufacturing trade dependency in 2020. The results show that: (1) Although China-EU equipment manufacturing trade has continued to grow, China had an imbalanced export structure to the EU, and electronic equipment exports are too high; (2) Regardless of import or export, the trade dependence of the EU countries on China about equipment manufacturing was higher than that of China on European countries; (3) China mainly depended on the EU about the high-end equipment manufacturing trade, which brings risks to Chinese manufacturing supply chains.

Effect of European Integration on the Competitiveness of the Agricultural Sector in New Member States (EU-13) on the Internal EU Market

The 2004, 2007, and 2013 enlargement of the EU opened up free trade opportunities, increasing trade flows and demand for products of agriculture. On the one hand, the integration processes have intensified competition between countries, and on the other hand, they have created new opportunities for them. The aim of the study was to evaluate the effect of European integration on the competitiveness of the agricultural sector in countries that acceded to the EU in or after 2004. The assessment of the competitiveness of the agricultural sector was made using the following indicators: land and labour productivity in agriculture, importance of the agricultural sector in the economy of the EU countries, agricultural trade balance, importance of agricultural export in total export of the EU countries, trade coverage ratio, Grubel–Lloyd intra-industry specialization indicator, and Balassa comparative advantage indicator. The analysis was carried out from 2004 to 2020 with the Eurostat statistical database. The outcome of surveys implies that a gap still exists between the old and the new member states of the European Union (EU) in the efficient utilisation of their production factors, despite an increased dynamics of growth in labour productivity compared with the old member states, the so-called EU-15. The overall competitive position of all EU-13 countries in agricultural trade on the common EU market has improved; however, individual analysis reveals disparities between respective member states. In 2020, net exporters with comparative advantage were Hungary, Bulgaria, Lithuania, and Croatia, and net importers with comparative disadvantage included Poland, Czechia, Slovakia, Estonia, and Malta. Latvia and Romania improved their competitive position in agricultural trade.

Does intra-industry specialisation enhance or limit comparative advantage? Evidence from the world citrus fruit trade

In this paper, we aim to identify the intensity and nature of intra-industry specialisation in the global trade in citrus fruits. We used data from the United Nations Comtrade database. We performed both static and dynamic assessments of the intensity of intra-industry trade (IIT) by using the traditional Grubel-Lloyd index and the marginal IIT (MIIT) index, respectively. We also separated IIT into horizontal and vertical trade, and we verified the relationship between changes in the intra-industry pattern of trade and the level of comparative advantage gained by the largest producers and exporters of citrus fruits in the world. We used the revealed symmetric comparative advantage (RSCA) index to evaluate the level of international competitiveness. Conducting these analyses allowed us to fill the existing research gap by identifying the nature of IIT in products with specific quality characteristics but at a lower processing stage. The study's results indicated that the stronger the IIT or the more intensive shifts toward deepening the intra-industry specialisation, the lesser the comparative advantage of a country in the global export of citrus fruits. Nevertheless, the increased intensity of intra-industry specialisation does not always lead to a deterioration in the value of the trade balance.

Russian intra-industry trade: Trends in recent decades

The article reveals the trends of Russian intra-industry trade in the period 2001–2018 with the twenty largest partners, united in three groups, namely developed economies, developing countries and CIS states. Intra-industry trade was estimated using data for export and import for each of the 6-digit Harmonized Commodity Description and Coding System product groups. The authors use the Fontanier — Freudenberg and Grubel — Lloyd indices to determine the share of horizontal, vertical and high-quality vertical IIT in agricultural products, raw materials and manufactures. It was revealed that Russia’s intra-industry trade including high-quality vertical IIT, both in terms of value and intensity is highly concentrated on the CIS countries, especially Belarus. A vertical type of intra-industry specialization dominates Russia’s intra-industry trade with all groups of countries, which generally corresponds to global trends. However, the horizontal type of specialization is most pronounced in trade with the CIS countries. It was found that most of the intra-industry exchange takes place in trade in manufactures, mainly with Belarus. The intensity of intra-industry trade in all commodity groups with both developed and developing countries remains very low and has not changed over the period under review. It is noted that during the 2010s, the intensity of all types of intra-industry trade with Belarus and Kazakhstan increased, primarily trade in industrial and agricultural goods, which is largely due to integration. The authors conclude that further integration with this group of countries contributes to the development of intra-industry specialization, export sophistication and the realization of technological advantages.

РЕГИОНАЛЬНЫЙ ОПЫТ ОБЕСПЕЧЕНИЯ ПРОДОВОЛЬСТВЕННОЙ БЕЗОПАСНОСТИ

The pandemic, which began in 2020, has seriously exacerbated the problem of food security in many countries. The purpose of the research is to identify the main factors of the stability of the agro-industrial complex using the example of one of the Russian regions and to consider the possibility of applying the accumulated experience in other subjects of the Federation. The object of the study is the Republic of Mordovia, a relatively small Volga region, located in the zone of risky farming and consistently demonstrating high rates of agricultural production. The region produces 1.2% of the total volume of agricultural products while its area is 0.2% and a population is 0.54% of the values of these indicators in the country. The study used data from Rosstat, proceedings from authoritative international organizations. One of the main factors for the stability of the regional agri-food complex is the high proportion of agricultural organizations, which is significantly higher than the national average. However, the cultivation of potatoes and vegetables is mainly concentrated in personal subsidiary plots, therefore, along with the implementation of an agricultural policy aimed at the development of large-scale agro-industrial production, it is necessary to organize the purchase of products from the population. This will help raise the living standards of villagers and stabilize the demographic situation. Another factor in the sustainable development of agriculture in Mordovia is the correct choice of intra-industry specialization. The leading industry is animal husbandry, the success of which is largely ensured by the dynamic development of poultry farming: the region accounts for 3.6% of the poultry population in agricultural organizations of the Russian Federation, Mordovia ranks 10th in the country in the production of eggs in agricultural organizations. The current demographic situation poses a potential threat to the development of the agricultural sector. If in Russia 1990-2018 the number of rural residents decreased by 4%, while in the Republic of Mordovia - by more than 30%. Therefore, the priority task of the social and economic policy of Mordovia should be the preservation of the rural population and the creation of conditions for attracting and fixing migrants in the region

Prospects for the development of the knowledge economy of Ukraine as an actor of the "semi-periphery" of Europe

In the XXI century the economic development of countries depends on the increasing role of the human factor in reproduction processes, as well as on the ability to generate innovative transformations. Therefore, examining the patterns of formation, distribution and functioning of the people's wealth, it can be argued that together with knowledge, human capital forms a new type of economy - the knowledge economy, which is the highest stage in the development of the post-industrial and innovative economy. The subject of research of the article is the formation of the knowledge economy as a new key factor in the development of national economies. The goal of this work is to analyze the factors of development of the Ukrainian economy as an actor of the "semi-periphery" of Europe. Task is to study the state and development prospects of the semi-periphery of Europe on the example of Ukraine. The article uses general scientific methods: the study of the development of economic processes was carried out on the basis of the method of scientific abstraction, general and partial. The most common scientific methods of cognition during this research: historical and logical method, analysis, synthesis, method of quantitative and qualitative comparisons, statistical method, economic and mathematical modeling. The following results were obtained: the statistical data characterizing the level of economic development of the semi-periphery countries of Europe and the state of Ukraine were systematized and analyzed, the coefficient of intra-industry international specialization was calculated. The systemic factors that have the greatest influence on the functioning and progress of the economy of the semi-periphery countries have been determined. The problems that hinder the development of semi-periphery actors on the example of Ukraine are highlighted and ways to overcome the shortcomings are proposed. Conclusions: it is advisable to use the results of the work in the domestic and foreign economic activity of countries as recommendations for determining the priority direction of development.

Development of Trade Relations of Bosnia and Hercegovina with Slovenia: Different Aspects and Characteristics

Abstract The paper is aimed at identifying characteristics of trade relations of Bosnia and Herzegovina (BiH) with the Republic of Slovenia (Slovenia) in order to contribute to determining the position of BiH in its bilateral trade. The foreign trade analysis has been performed in the context of the changing trade regime between the two countries, thereby including both institutional and functional aspects of bilateral trade relations development. Different trade indicators have been calculated and interpreted for the period of 2003-2017 and/or for selected years which were identified by a change in the institutional regulations of mutual trade flows. The research results indicate increasing trade intensity between the two countries, with almost balanced export and import flows and with prevailing inter-industry trade. The trade performance of BiH has significantly improved, with increasing intra-industry specialization and trade. However, the export structure and comparative advantage pattern are not favourable toward BiH, which points to the need for improving the country’s position in its trade with Slovenia.

Intra-Industry Competitiveness of the European Union Member States by Industry in 2004–2015

The article aims to present the results of research into changes in the international competitive position of the European Union Member States in the period 2004–2015 on the basis of analysing the development of particular types of intra-industry trade (IIT) of manufactured goods.
 The investigation was based on the IIT share measurement methodology (Grubel, Lloyd 1975) and calculations of types of intra-industry trade (Greenaway, Hine, Milner 1994, 1995). Multilateral IIT indices were computed at the 6-digit CN code level on the basis of data published by Eurostat.
 As part of a larger research project funded by the National Science Centre, this analysis contributes to the assessment of the degree of intra-industry specialisation of the EU Member States and the resulting changes in the international competitive position of the economies covered.

The textile and clothing industry in the Danube region countries: Comparative advantages

The subject of this study is the analysis of comparative advantages of international export in the TC (textile and clothing) industry of the Danube region countries with a special focus on Serbia. The aim of this study is to analyze the comparative advantage and suggest possible economic and legal measures to strengthen export. This study observed export per capita and participation of TC industry export, and measured the comparative advantage and specialization of the Danube region countries in the period between 2005 and 2013. In the course of research, we used the Balassa (RCA) and Lafay (LFI) indexes of comparative advantage, and the GL index and RUV index of horizontal and vertical specialization in intra-industry exchange. The research has revealed positive comparative advantage in the export of the textile industry in the Czech Republic, Germany and Slovenia. In the clothing industry export, positive comparative advantage was revealed in the cases of: Bulgaria, Hungary, Moldova, Romania, Slovakia and Serbia. The research has shown a positive comparative advantage of the TC industry sector in Serbia. The results of our research into the TC industry reveal the existence of correlation between comparative advantage and intra-industry specialization in international trade.

Structural Changes in the Service Industries of Korea and Major Countries: The Relationship between Inter-industry and Intra-industry Specialization

Structural Changes in the Service Industries of Korea and Major Countries: The Relationship between Inter-industry and Intra-industry Specialization

Comparative Advantage of Textiles and Clothing: Evidence for Top Exporters in Eastern Europe

The comparative advantage and intra-industry trade of five countries: Czech Republic, Hungary, Poland, Romania and Turkey, are analyzed in the global textile and clothing markets by employing Balassa’s revealed comparative advantage (RCA) index and intraindustry trade (IIT) index for the period 2002-2013. The results have revealed that while Turkey is the only one among the countries selected to have comparative advantage in the global textile market, Romania joins Turkey in this in the world’s clothing market. The comparative advantage of these two countries in the global clothing market presents a stronger declining trend compared to that in textiles, which is probably due to the entrance of cheap-labour eastern Asian countries into the global clothing market, as this market is more labor-intensive compared to textiles. Moreover, while a high intra-industry trade index is found in Czech Republic, Hungary and Poland, an inter-industry trade structure is observed in Romania for textiles and clothing. Turkey presents intra-industry specialisation in textiles, while possessing inter-industry trade structure in terms of clothing.

Trade Performance and Competitiveness of the Slovak Wood Processing Industry within the Visegrad Group Countries

ABSTRACT • The aim of this paper is to analyse trade performance and competitiveness of the Slovak wood processing industry sectors and their comparison with the Visegrad group countries. The competitiveness is stud-ied for the products of primary wood processing, namely coniferous and non-coniferous sawnwood, wood based panels, wood pulp, paper and paperboard products. A set of trade performance and competitiveness indicators is used to analyse the position and changes in competitiveness of the respective countries in 2003-2012. In par-ticular, Trade Specialisation Index, Export/Import Ratio, Standard Grubel-Lloyd Index, Revealed Comparative Advantage and Vollrath’s Revealed Competitive Advantage Indexes were used to identify comparative advantages and trade specialisation for individual forest product categories and a specifi c country’s performance. Within the group of analysed countries, Slovakia has revealed comparative advantage in most of the products, in particular in the trade with coniferous sawnwood, non-coniferous sawnwood, wood based panels and paper and paperboard products. Results of the analysis also pointed out that intra-industry specialisation is increasing with the level of value added to products.

THE REGIONAL ASSESSMENT OF MARGINAL INTRA-INDUSTRY SPECIALIZATION

The dynamics of intra-industry specialization was shown by means of the regional indices of marginal specialization, indices which break down the changes which appear in the specialization processes into two components: the marginal intra-industry specialization and the inter-industry specialization. The regional assessment of the marginal intra-industry specialization was done on the level of the sections in the Combined Register, and the results of the analyses confirm the fact that the dynamics of the specialization processes in the Romanian regions was greatly influenced by the increase of intra-industry specialization, increase manifested especially in the specialization process pertaining to the manufacturing of products which use intensively the human capital and high technology.

Changes in Intra-industry Competitiveness of the New Member States (EU-10) Economies During the Crisis, the Years 2009-2011

The global financial crisis, mostly triggered by external factors, interrupted the trend toward enhanced strength of the EU-10 economies, which was the outcome of the solid structural reforms carried out in the pre-accession era. In this regard, this article investigates the following research problem: what have been the changes in intra-industry competitiveness of the new member states (EU-10) economies during the crisis, and to what degree have the positive adaptive processes taking place in the structures of their economies before and after their accession to the EU - which reflected the extent of their preparations for full integration with the single EU market - been influenced by this crisis? This paper aims to present the main results of our analysis of changes in the trade flows of the examined countries in the initial years after the accession (2003-2008), and subsequently during the crisis (2009-2011). It especially focuses on presenting the main tendencies in intra-industry trade development in mutual trade among the new member states and with the EU-15 countries, and the main changes in a vertical and horizontal intra-industry specialization.

Intra-Industry Specialization in United States–China Trade

Frictions in U.S.–China bilateral trade relations have intensified in recent years. Changes in intra-industry specialization indicators are used to assess factor adjustment pressures that may have been experienced by U.S. and Chinese industries from recent growth in bilateral trade. Many industries experienced large increases in intra-industry trade over the 2000–10 period. Only 14 of 62 U.S. industries may have experienced factor adjustment pressures. Most U.S. industries gained from growth in U.S.–China trade. Nine Chinese industries may have faced factor adjustment pressures. The United States should refrain from using trade remedy measures to address bilateral trade frictions and focus instead on improving trade relations.

Cambodia’s Comparative Advantage Patterns and Trade Structure from 1985 to 2010

This paper examines the structure of international trade and evaluates the patterns of Cambodia’s comparative advantage from 1985 to 2010 using the Revealed Comparative Advantage (RCA) index. It is found that: (i) Cambodia’s exports were initially concentrated in some primary goods and basic manufactures; (ii) resource-based exports shifted to light and labour-intensive industrial products in the mid-1990s; (iii) trade diversification is still low despite government efforts in industrial development and trade integration; and (iv) intra-industry specialization occurs in the relatively low value-added product ranges. Consequently, Cambodia needs to build a solid base for industrialization—both physical and institutional—to further develop infrastructure; enhance human resource development; develop competitive and diverse export industries; and implement sound trade, investment and education policies.

Central European countries and the smooth adjustment hypothesis

This paper analyses bilateral trade between the Czech Republic, Poland, and Slovenia as Central European Countries (CEC-3) and the 15 European member states (EU-15). The study briefly presents a modified theory of customs unions; discusses results of the measurement of vertical intra-industry trade between the Czech Republic, Poland and Slovenia in trade with the EU-15; and identifies other important factors that define vertical intra-industry trade between the CEC-3 and EU-15 members. The aim of this paper is to test the smooth adjustment hypothesis (SAH), which predicts that a high level of total intra-industry trade is positively related to low adjustment costs. The traditional theory of customs unions supposes that members of customs unions or other regional trading arrangements have different relative factor endowments, which— under free trade conditions—results in inter-industry specialisation. Consequently costs of adjustments are smaller in the case of more developed member countries and greater in the case of less developed member countries. The modified theory of customs unions predicts that reduced trade barriers within the union will lead countries to intraindustry specialisation, which will have important implications for the short-run costs of adjustment—namely, the costs of adjustment will be smaller for all members of the customs union irrespective of their stage of development. Although the modified version of customs unions theory assumes that the SAH is valid, this paper confirms the view of many other authors that this hypothesis is doubtful.

The Impact of European Union Membership on Competitiveness and Specialisation in Lithuania

This paper analyses Lithuania’s competitiveness in the context of enlarged European Union. Aiming to assess the extent of structural change after the accession, the patterns of the country’s inter- and intra-industry trade specialisation are evaluated. Inter-industry specialisation is investigated using revealed comparative advantage index pioneered by Balassa, while the analysis of intra-industry specialisation is based on Grubel-Lloyd index. The results disclose almost unchanged patterns of both types of specialisation and suggest little prospects for the country’s prosperity and long term welfare gains.

Factor adjustment implications of a free trade agreement between the United States and Thailand

Changes in intra-industry specialization indicators are used to assess factor adjustment pressures that may be experienced by U.S. and Thai industries from a proposed U.S.–Thailand Free Trade Agreement (FTA). Many industries experienced large increases in intra-industry trade over the 2000–2008 period. Ten U.S. industries are found to be candidates for factor adjustment pressures based on past experiences. These industries account for 38% of all U.S. imports from Thailand and 4% of imports from all trading partners. Results also show that nine Thai industries face possible adjustment pressures. These industries account for 9% of Thai imports from the United States. An FTA should result in a larger increase in U.S. exports to Thailand than U.S. imports from Thailand because Thai exporters face much lower tariffs in the U.S. market than do U.S. exporters in the Thai market.