Constructing the Asia-Pacific Regional Cooperation and Integration Index: A Panel Approach

Cyn-Young Park () and Racquel Claveria ()
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Racquel Claveria: Asian Development Bank

No 544, ADB Economics Working Paper Series from Asian Development Bank

Abstract: In this paper, we propose a panel approach in the construction of the Asia-Pacific Regional Cooperation and Integration Index (ARCII) to strengthen the index’s ability to track the progress of economic integration in the region over time. Panel-based procedures are employed in imputing missing values, normalizing raw data, and deriving dimensional and subdimensional weights via principal components analysis. Findings suggest the pace of integration in Asia was broadly steady over the 11-year sample period (2006–2016). However, modest gains have been made as a majority of economies in the sample have moved up in their levels of regional integration from 2006 to 2016. Of the six dimensions featured in the ARCII, trade and investment and movement of people are the main drivers of regional integration, while the money and finance dimension was the weakest link. Based on global normalization, Asia comes second to the European Union (EU) in progress on regional integration, but in recent years a few Asian economies have broken through to the top tier dominated by the EU economies.

Keywords: Asia; composite index; regional integration (search for similar items in EconPapers)
JEL-codes: C38 C43 F15 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2018-05-10
New Economics Papers: this item is included in nep-sea and nep-war
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Citations: View citations in EconPapers (7)

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Working Paper: Constructing the Asia-Pacific Regional Cooperation and Integration Index: A Panel Approach (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:ris:adbewp:0544

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