New Asean Member Countries’ Exports to Japan: An Assessment of the New Goods Margin

Main Article Content

Irwin Cruz

Abstract

Growth in exports along extensive margins has been observed during periods of trade liberalization. A rise in new goods margins is important for developing countries as this is a sign of increasing productivity of local firms and a move from overdependence on a small basket of goods. Adapting the methodology of Kehoe and Rul. This study evaluates the changes in the share of total value of
the least traded export goods from new ASEAN member countries to Japan before and after the ratification of the ASEAN-Japan FTA. For each of the four countries, a baseline of HS lines of products comprising near 10% of total export value in 2009 was created from the BACI dataset. The analyses show that by 2018 the share
of least traded goods to Japan have risen to almost 69% of total export value for Cambodia, 57% for Myanmar and 55% for Laos. For Vietnam, the rise is a modest 29%.

Downloads

Download data is not yet available.

Article Details

How to Cite
Cruz, I. (2022). New Asean Member Countries’ Exports to Japan: An Assessment of the New Goods Margin. WILAYAH: The International Journal of East Asian Studies, 11(1), 34–50. Retrieved from http://adum.um.edu.my/index.php/IJEAS/article/view/34680
Section
Articles

References

ADB. Cambodia: Diversifying beyond Garments and Tourism. Country Diagnostic Study, Manila: Asian Development Bank, 2014.

ADB. Lao PDR Accelerating Structural Transformation for Inclusive Growth. Country Diagnostic Study, Manila: Asian Development Bank, 2017.

ADB. Myanmar Unlocking the potential. Country Diagnostic Study, Manila: Asian Development Bank, 2014.

Amarsanaa, Chingunjav, and Yoshinori Kurokawa. "The extensive margin of international trade in a transition economy: the case of Mongolia." Comparative Economic Studies 63, no. 4 (2021): 648-673.

Amurgo-Pacheco, Alberto, and Martha Denisse Pierola. "Patterns of export diversification in developing countries: Intensive and extensive margins." World Bank Policy Research Working Paper No. 4473, 2008.

Arkolakis, Costas, Sharat Ganapati, and Marc-Andreas Muendler. "The extensive margin of exporting products: A firm-level analysis." American Economic Journal: Macroeconomics 13, no. 4 (2021): 182-245.

Asean. "Asean-Japan Economic Relation." Asean. n.d. https://asean.org/our-communities/economic-community/integration-with-global-economy/asean-japan-economic-relation/ (accessed October 8, 2021).

Bayudan-Dacuycuy, Connie. "Bayudan-Dacuycuy, Connie. "The Philippine export portfolio in the product space: potentials, possibilities and policy challenges." Economics Bulletin 32, no. 1 (2012): 59-66.

Bempong Nyantakyi, Eugene, Steven Husted, and Shuichiro Nishioka. "Trade Frictions and Market Access of Developing Countries: A Product‐level Empirical Investigation." Review of International Economics 23, no. 5 (2015): 924-945.

Bista, Risha. "Reconciling the WTO effects on trade at the extensive and intensive margins." International Economic Journal 29, no. 2 (2015): 231-257.

Broda, Christian, and David E. Weinstein. "Globalization and the Gains from Variety." The Quarterly journal of economics 121, no. 2 (2006): 541-585.

Cadot, Olivier, Céline Carrère, and Vanessa Strauss-Kahn. "Export diversification: what's behind the hump?" Review of Economics and Statistics 93, no. 2 (2011): 590-605.

Carrasco , Carlos, and Edgar Demetrio Tovar-García. "Trade and growth in developing countries: the role of export composition, import composition and export diversification." Economic Change and Restructuring (Springer) 54, no. 4 (2021): 919-941.

Chen, Maggie Xiaoyang, John S. Wilson, and Tsunehiro Otsuki. "Standards and export decisions: Firm-level evidence from developing countries." The Journal of International Trade & Economic Development 17, no. 4 (2008): 501-523.

Cho, Sang-Wook Stanley, and Julián P. Díaz. "The new goods margin in new markets." Journal of Comparative Economics 46, no. 1 (2018): 78-93.

Cho, Sang-Wook Stanley, and Julián P. Díaz. "The dynamics of trade margins: Evidence from the European integration." Economics Letters 167 (2018): 90-96.

Cho, Sang-Wook Stanley, Hansoo Choi, and Julián P. Díaz. "Do free trade agreements increase the new goods margin? Evidence from Korea." Open Economies Review 29, no. 5 (2018): 1095-1122.

Cirera, Xavier, Anabel Marin, and Ricardo Markwald. "Explaining export diversification through firm innovation decisions: The case of Brazil." Research Policy 44, no. 10 (2015): 1962-1973.

Cuaresma, Jesús Crespo, and Julia Wörz. "On export composition and growth." Review of World Economics 141, no. 1 (2005): 33-49.

Dalton, John T. "The evolution of taxes and hours worked in Austria, 1970–2005." Macroeconomic Dynamics 19, no. 8 (2015): 1800-1815.

Dalton, John T. "The new goods margin in Japanese–Chinese trade." Japan and the World Economy 31 (2014): 8-13.

Del Rosal, Ignacio. "EU Enlargement and the New Goods Margin in Austrian Trade: Comment." Open Economies Review 28, no. 4 (2017): 795-803.

DeRosa, Dean. "Increasing Export Diversification in Commodity Exporting Countries: A Theoretical Analysis." Staff Papers (International Monetary Fund) 39, no. 3 (1992): 572-595.

Evenett, Simon J., and Anthony J. Venables. "Export growth in developing countries: Market entry and bilateral trade flows." 2002.

Feenstra, Robert C. , and Alan M. Taylor. International economics, New York: Worth. Worth, 2014.

Feenstra, Robert C. "New product varieties and the measurement of international prices." The American Economic Review 84, no. 1 (1994): 157-177.

Feenstra, Robert C., and Ma Hong. "Trade facilitation and the extensive margin of exports." The Japanese Economic Review 65, no. 2 (2014): 158-177.

Feenstra, Robert, and Hiau Looi Kee. "Export Variety and Country Productivity: Estimating the Monopolistic Competition Model with Endogenous Productivity." Journal of International Economics 74, no. 2 (2008): 500-514.

Feenstra, Robert, and Hiau Looi Kee. "On the measurement of product variety in trade." American Economic Review 94, no. 2 (2004): 145-149.

Fontagné, Lionel, Gianluca Orefice, Roberta Piermartini, and Nadia Rocha. "Product standards and margins of trade: Firm-level evidence." Journal of international economics 97, no. 1 (2015): 29-44.

Funke, Michael, and Ralf Ruhwedel. "Export variety and economic growth in East European transition economies." Economics of transition 13, no. 1 (2005): 25-50.

Funke, Michael, and Ralf Ruhwedel. "Export variety and export performance: empirical evidence from East Asia." Journal of Asian Economics 12, no. 4 (2001): 493-505.

Gaulier, Guillaume, and Soledad Zignago. Baci: international trade database at the product-level (the 1994-2007 version). Paris: CEPII, 2010.

Hausmann, Ricardo, and Dani Rodrik. "Economic development as self-discovery." Journal of development Economics 72, no. 2 (2003): 603-633.

Hoekman, Bernard. "Trade and the post-2015 development agenda." In Win-win: how international trade can help meet the sustainable development goals., by Matthias Helble, & Ben Shepherd. Tokyo: Asian Development Bank Institute, 2017.

Hummels, David, and Peter J Klenow. "The variety and quality of a nation's exports." American Economic Review 95, no. 3 (2005): 704-723.

Imbs, Jean, and Romain Wacziarg. "Stages of diversification." American Economic Review 93, no. 1 (2003): 63-86.

JAIF. ASEAN-Japan Comprehensive Economic Partnership (AJCEP). n.d. https://jaif.asean.org/jaif-component/asean-japan-comprehensive-economic-partnership-ajcep/ (accessed February 19, 2021).

Jongwanich, Juthathip. "Export diversification, margins and economic growth at industrial level: Evidence from Thailand." The World Economy 43, no. 10 (2020): 2674-2722.

Kehoe, Timothy J, and Kim J. Ruhl. "How important is the new goods margin in international trade?" Journal of Political Economy 121, no. 2 (2013): 358-392.

Krugman, Paul R. "Increasing returns, monopolistic competition, and international trade." Journal of international Economics 9, no. 4 (1979): 469-479.

Krugman, Paul R., Maurice Obstfeld, and Marc Melitz. International Economics. 12th. Pearson, 2012.

Lederman, Daniel, and William Maloney. Does what you export matter?: In search of empirical guidance for industrial policies. World Bank Publications, 2012.

Malloy, Brandon. "Decomposing episodes of large growth in international trade." Review of International Economics 29, no. 2 (2021): 228-267.

Mania, Elodie, and Arsène Rieber. "Product export diversification and sustainable economic growth in developing countries." Structural change and economic dynamics, 2019: 138-151.

Martincus, Christian Volpe, and Jerónimo Carballo. "Is export promotion effective in developing countries? Firm-level evidence on the intensive and the extensive margins of export." Journal of International Economics 76, no. 1 (2008): 89-106.

Mattoo, Aaditya, Nadia Rocha , and Michele Ruta. Handbook of Deep Trade Agreements. Washington, DC: World Bank., 2020.

Melitz, Marc J. "The impact of trade on intra‐industry reallocations and aggregate industry productivity."." econometrica 71, no. 6 (2003): 1695-1725.

MITI. "MITI." Malaysia's Free Trade Agreeents. n.d. https://fta.miti.gov.my/index.php/pages/view/asean-japan?mid=36 (accessed October 30, 2021).

MOFA Japan. "Ministry of Foreign Affairs of Japan." ASEAN-Japan Comprehensive Economic Partnership Agreement. 3 August 2020. https://www.mofa.go.jp/policy/economy/fta/asean.html (accessed October 8, 2021).

Naing, Daw Zin Zin. "Trade policy reform in Myanmar." Asia-Pacific Trade Economists Conference: Trade in the Asian century-delivering on the promise of economic prosperity. Bangkok: UN-ESCAP, 2014.

Nieminen, Mika. "Multidimensional financial development, exporter behavior and export diversification." Economic Modelling 93 ((2020): 1-12.

Persson, Maria. "Trade facilitation and the extensive margin." The Journal of International Trade & Economic Development 22, no. 5 (2013): 658-693.

Regis, Paulo José. "The extensive and intensive margins of exports of firms in developing and emerging countries." International Review of Economics & Finance 56 (2018): 39-4.

Reis, José Guilherme, and Thomas Farole. Trade competitiveness diagnostic toolkit. Washington: World Bank Publications, 2012.

Samen, Salomon. A primer on export diversification: key concepts, theoretical underpinnings and empirical evidence. Washington, DC: Growth and Crisis Unit World Bank Institute, 2010, 1-23.

Shepherd, Ben. Product standards, harmonization, and trade: evidence from the extensive margin. Vol. 4390. World Bank Publications, 2007.

Silva, MC Santos, Silvana Tenreyro, and Kehai Wei. "Estimating the extensive margin of trade." Journal of International Economics 93, no. 1 (2014): 67-75.

Wacziarg, Romain. "Measuring the dynamic gains from trade." The world bank economic review 15, no. 3 (2001): 393-429.