Regional Integration and Industrial Growth among Developing Countries : The Case of Three ASEAN Members

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.

Bibliographic Details

Main Author:	Madani, Dorsati H.
Language:	English en_US
Published:	World Bank, Washington, DC 2001-10
Subjects:	ANDEAN PACT, AVERAGE TARIFF, BUSINESS CYCLE, CAPITAL STOCK, COAL, CONSTANT RETURNS TO SCALE, COST MINIMIZATION, DEBT, DEVELOPED COUNTRIES, DOMESTIC INDUSTRIES, DOMESTIC INDUSTRY, DOMESTIC PRODUCERS, ECONOMIC INTEGRATION, ECONOMIES OF SCALE, ELASTICITY, ELASTICITY OF SUBSTITUTION, EMPIRICAL ANALYSIS, EMPIRICAL STUDIES, ENDOGENOUS VARIABLES, EXCHANGE RATES, EXERCISES, EXPLOITATION, EXPORTS, EXTERNALITY, FINAL GOODS, FOREIGN COMPETITION, FOREIGN DIRECT INVESTMENT, GROSS OUTPUT, GROWTH RATE, GROWTH THEORY, HUMAN CAPITAL, IMPACT OF TRADE, IMPACT OF TRADE LIBERALIZATION, IMPERFECT COMPETITION, IMPORT PRICES, IMPORT QUOTAS, IMPORTS, INDUSTRIAL PRODUCTION, INDUSTRY TRADE, INNOVATION, INPUT-OUTPUT TABLES, INTERMEDIATE GOODS, INTERMEDIATE IMPORTS, INTERMEDIATE INPUTS, INTERNATIONAL TRADE, INTERNATIONAL TRADE POLICIES, LABOR PRODUCTIVITY, LAISSEZ FAIRE, LIBERALIZATION OF TRADE, MEASURES OF INTEGRATION, METALS, NATIONAL MARKET, OIL, OIL PRICE, PH, POSITIVE EXTERNALITIES, PRICE INDEX, PRODUCERS, PRODUCTION EFFICIENCY, PRODUCTION FUNCTION, PRODUCTION PROCESS, PRODUCTIVITY, PRODUCTIVITY GROWTH, QUOTAS, REDUNDANCY, REGIONAL INTEGRATION, REGIONAL TRADE, REGIONALISM, RETURNS TO SCALE, SCALE EFFECT, SCALE EFFECTS, SPECIALIZATION, TARIFF LEVELS, TARIFF RATE, TARIFF RATES, TARIFF REDUCTION, TARIFF REDUCTIONS, TECHNOLOGICAL PROGRESS, TECHNOLOGY TRANSFER, TIME SERIES, TOTAL FACTOR PRODUCTIVITY, TRADE DATA, TRADE DIVERSION, TRADE FLOWS, TRADE LIBERALIZATION, TRADE PARTNERS, TRADE POLICIES, TRADE REFORM, TRADE REGIME, TRADE RESTRICTIONS, TRADE VOLUMES, UNILATERAL LIBERALIZATION, WAGES, WORKERS, WORLD TRADING SYSTEM,
Online Access:	http://documents.worldbank.org/curated/en/2001/10/1615099/regional-integration-industrial-growth-among-developing-countries-case-three-asean-members https://hdl.handle.net/10986/19509
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