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Measuring Barriers to International Division of Labor in East Asia

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International fragmentation has developed dramatically in East Asia since the 1990s. The purpose of the present paper is to measure border barriers in transactions of intermediate goods in East Asian countries. We find that the barriers in each country have steadily declined since 1985. The barriers in China and Taiwan have declined remarkably since the 1980s, whereas those in Indonesia experienced a slight increase in the 1980s. These results are qualitatively unchanged even if we control the effect of agglomeration on intra-national inputs.
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Keywords: D23; East Asia; F15; R12; R15; agglomeration; border effect; fragmentation

Document Type: Research Article

Affiliations: Faculty of Economics, Keio University, Mita 2-15-45, Minato-ku, Tokyo 108-8345, Japan

Publication date: June 1, 2007

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