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Title:North-South Technology Diffusion, Regional Integration, and the Dynamics of the ?Natural Trading Partners? Hypothesis PDF Logo
Authors:Schiff, Maurice
Wang, Yanling
Issue Date:2004
Series/Report no.:IZA Discussion paper series 1384
Abstract:Based on static analysis, a number of studies argue that forming a RTA is more likely to raise welfare if member countries are ?natural trading partners,? while other studies claim the opposite. This paper considers the argument from a dynamic viewpoint by examining the impact of trade with Japan, North America and the EU on technology diffusion and TFP in Korea, Mexico and Poland. Using industry-level data, we show that i) technology diffusion and productivity gains tend to be regional: Korea (Mexico) (Poland) benefits mainly from trade with Japan (North America) (the EU); and ii) the dynamic version of the ?natural trading partners? hypothesis seems to hold for Korea and Mexico though not necessarily for Poland.
Subjects:North-South technology diffusion
regional integration
natural trading partners
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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