North-South Technology Diffusion, Regional Integration, and the Dynamics of the “Natural Trading Partners” Hypothesis

Maurice Schiff and Yanling Wang ()
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Yanling Wang: Carleton University

No 1384, IZA Discussion Papers from Institute of Labor Economics (IZA)

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.

Keywords: Mexico; Poland; Korea; North-South technology diffusion; natural trading partners; productivity; regional integration (search for similar items in EconPapers)
JEL-codes: F02 F13 F15 F43 O39 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2004-11
New Economics Papers: this item is included in nep-dev
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Citations: View citations in EconPapers (1)

Published - published in: Revue d'économie du développement, 2007, 21 (5), 69-84

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Related works:
Journal Article: North-South technology diffusion, regional integration, and the dynamics of the “natural trading partners” hypothesis (2007)
Working Paper: North-South technology diffusion, regional integration, and the dynamics of the natural trading partners hypothesis (2004)
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