International production sharing and economic development: moving up the value-chain for a small-open economy

Nicholas Sim

Applied Economics Letters, 2004, vol. 11, issue 14, 885-889

Abstract: This study theoretically examines the factors required by a small-open economy to move up the value-chain. To carry out the study, a framework of production sharing involving a large developed country and a less developed small-open economy is used. Service bundles are modelled as inputs for coordinating the manufacturing activities located across the countries. It is found that the small-open economy can move up the value-chain when the size of its skilled labour force increases and the production cost of its service bundles decreases.

Date: 2004
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DOI: 10.1080/1350485042000285841

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