ASEAN-China Trade Flow: A Study on Intra-Industry Trade in Manufacturing Sector
Recent development of international trade has given rise to a new trade theory known as intra-industry trade whereby nations simultaneously import and export of similar goods in the same industry. This study aims to identify the significant of intra-industry trade between ASEAN-5 and China specifically focus on manufacturing sector. This study first examines the intra-industry trade relation between ASEAN-5 and China in manufacturing sector using trade value from SITC 5 to SITC 8 at four digits from 1993–2012. This study continues by identifying the determinants of intra-industry trade between ASEAN-5 and China in manufacturing sector using static panel model. The findings from this study indicated that intra-industry trade between ASEAN-5 and China in manufacturing sector increased during the study period. Besides, this research also found that intra-industry trade increased along with the growth in average market size and foreign direct investment while intra-industry trade is negatively related to the differences in income level.
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Document Type: Research Article
Affiliations: Economics and Corporate Administration Department, Finance and Business, Tunku Abdul Rahman University College, Jalan Genting Kelang, 53300 Kuala Lumpur, Malaysia
Publication date: April 1, 2017
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