On the stability of intra-industry trade
Kazunobu Hayakawa (),
Tadashi Ito and
Toshihiro Okubo ()
Journal of the Japanese and International Economies, 2017, vol. 45, issue C, 1-12
This paper presents the novel finding that, in contrast to what the previous literature has shown, two-way intra-industry trade (IIT) in product–country pairs, when looked from a dynamic perspective, is very unstable by using disaggregated trade data of OECD countries. Many products frequently switch among two-way, one-way and zero trade over time. To measure the stability of two-way trade, we propose a measure that we refer to as the “IIT stability index”. Our estimation results using the proposed measure show that two-way trade involving markets of different sizes and long distance are likely to be unstable and primary products are more unstable than manufactured products.
Keywords: Two-way trade; Intra-industry trade; Stability (search for similar items in EconPapers)
JEL-codes: F10 F14 (search for similar items in EconPapers)
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Working Paper: On the stability of intra-industry trade (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jjieco:v:45:y:2017:i:c:p:1-12
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