South-South Regional Integration and Industrial Growth : The Case of the Andean Pact

Has the revival of the Andean Pact affected the industrial growth of Bolivia, Colombia, and Ecuador? Has this regional agreement had greater effects tha unilateral liberalization? The author explores two potential channels for industrial growth: scale effects and variety of imported intermediate inputs. She analyzes data from 2 countries (classified at the three-digit level of ISIC) across three countries. The results show that: 10 The variety of intermediate inputs originating from nonregional partners has a significant positive impact on growth in a handful of industries. 2) The effect of regional variety is at best mixed. This lends preliminary support to the argument that unilateral liberalization will have a positive impact on output growth through the channel of imported intermediate inputs. There is significant homogeneity in industry-level returns to scale. Moreover, in the three Andean countries studied, cross-country scale effects were small and negative. Therefore, the three countries should not expect large or across-the-board gains through scale effects from their regional arrangement.

Bibliographic Details

Main Author:	Madani, Dorsati H.
Language:	English en_US
Published:	World Bank, Washington, DC 2001-06
Subjects:	AGGREGATE ANALYSIS, ANDEAN PACT, BUSINESS CYCLE, CAPITAL STOCK, COAL, CONSTANT RETURNS TO SCALE, COST MINIMIZATION, DEBT, DEVELOPED COUNTRIES, DEVELOPMENT ECONOMICS, DOMESTIC INDUSTRIES, DOMESTIC INDUSTRY, ECONOMIC COOPERATION, 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, FREE TRADE, GROSS OUTPUT, GROWTH RATE, GROWTH THEORY, HUMAN CAPITAL, IMPACT OF TRADE, IMPACT OF TRADE LIBERALIZATION, IMPERFECT COMPETITION, IMPORT PRICES, IMPORTS, INCREASING RETURNS, INDUSTRIAL PRODUCTION, INDUSTRIALIZATION, INNOVATION, INPUT-OUTPUT TABLES, INTERMEDIATE GOODS, INTERMEDIATE IMPORTS, INTERMEDIATE INPUTS, LABOR PRODUCTIVITY, LIBERALIZATION OF TRADE, MEASURES OF INTEGRATION, METALS, NATIONAL MARKET, OIL, PATTERNS, POSITIVE EFFECTS, POSITIVE EXTERNALITIES, PRICE INDEX, PRODUCTION EFFICIENCY, PRODUCTION FUNCTION, PRODUCTION PROCESS, PRODUCTIVITY, PRODUCTIVITY GROWTH, REDUNDANCY, REGIONAL INTEGRATION, REGIONAL TRADE, REGIONALISM, RETURNS TO SCALE, SCALE EFFECT, SCALE EFFECTS, SPECIALIZATION, TARIFF BARRIERS, TARIFF RATE, TARIFF RATES, TARIFF REDUCTION, TECHNOLOGICAL PROGRESS, TECHNOLOGY TRANSFER, TIME SERIES, TOTAL FACTOR PRODUCTIVITY, TRADE, TRADE DATA, TRADE DIVERSION, TRADE EFFECT, TRADE FLOWS, TRADE LIBERALIZATION, TRADE PATTERN, TRADE VOLUMES, UNILATERAL LIBERALIZATION, VALUE ADDED, WAGES, WORKERS,
Online Access:	http://documents.worldbank.org/curated/en/2001/06/1346407/south-south-regional-integration-industrial-growth-case-andean-pact https://hdl.handle.net/10986/19599
Tags:	Add Tag No Tags, Be the first to tag this record!