Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/222829 
Year of Publication: 
2019
Series/Report no.: 
ADBI Working Paper Series No. 1062
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
The emergence of production networks has changed the structure of international trade, which a large share of intra-regional trade flows and the rising value of intermediate goods trade or network trade between countries within the same region reflect. While a production network exists in both East Asia and the European Union, the patterns could be different due to the differences in sociocultural, political, historical, and institutional factors between the two regions. This paper investigates and compares the pattern of network trade in East Asia and the European Union. It also explores how economic integration is related to the network trade pattern. The paper confirms that network trade in East Asia is more like a "network pattern," while that in the European Union follows a "hub-and-spoke pattern." At the global level, intermediate goods exports are more sensitive to trade barriers than total goods exports. A comparison between East Asia and the European Union shows that countries in East Asia have successfully reduced the service link costs. Despite the efforts that East Asia has directed towards export market diversification, the region is still more dependent on other regions' economic conditions than the European Union is. k
Subjects: 
production network
gravity model
European Union
East Asia
interdependence
remoteness
intermediate goods trade
JEL: 
F13
F14
F15
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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