HORIZONTAL AND VERTICAL INTRA-INDUSTRY TRADE: IS THE EMPIRICAL CLASSIFICATION USABLE?
On the basis ofOECD trade statistics at SITC 5 digit levelfor the period 1961-1999 this paper shows the classification of international trade in (1) inter-industry trade; (2) horizontal intra-industry; and (3) vertical intra-industry trade used in the empirical trade litera!Ure to be unstable at the...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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People & Global Business Association (P&GBA)
2002-03-01
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| Series: | Global Business and Finance Review |
| Subjects: | |
| Online Access: | http://www.gbfrjournal.org/pds/journal/thesis/20150624161245-PRAKS.pdf |
| Summary: | On the basis ofOECD trade statistics at SITC 5 digit levelfor the period 1961-1999 this paper shows the classification of international trade in (1) inter-industry trade; (2) horizontal intra-industry; and (3) vertical intra-industry trade used in the empirical trade litera!Ure to be unstable at the individual product level. This indicates that this type ofstatistical classification based on unit-values is probably not very useful. On the other hand, the paper also shows in accordance with the literature, that the aggregate distribution of trade into the three categories apparently is rather stable with vertical intra-industry trade (between Germany and France) making up 50-60%. The high level ofvertical intra-industry trade probably cover-up many products shifting between e.g verlical and horizontal intra-industry. The statement from the literature that the European inteJ{ration process involves heavy adjustment costs because of the size of vertical intra-industry trade is therefore rather dubious. |
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| ISSN: | 1088-6931 2384-1648 |