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Geographical simulation analysis for logistics enhancement in Asia

Kumagai Satoru, Kazunobu Hayakawa (), Ikumo Isono, Souknilanh Keola and Kenmei Tsubota

No 369, IDE Discussion Papers from Institute of Developing Economies, Japan External Trade Organization(JETRO)

Abstract: This paper presents a simulation of the reduction of several components in trade cost for Asia and examines its impact on the economy. Our simulation model based on the new economic geography embraces seven sectors, including manufacturing and non-manufacturing sectors, and 1,715 regions in 18 countries/economies in Asia, in addition to the two economies of the US and the European Union. The geographical course of transactions among regions is modeled as determined based on firms’ modal choice. The model also includes estimates of some border cost measures such as tariff rates, non-tariff barriers, other border clearance costs, transshipment costs and so on. Our simulation analysis for Asia includes several scenarios involving the improvement/development of routes and the reduction of the above-mentioned border cost. We have shown that the contribution of physical and non-physical infrastructure improvements conducted together is larger than the sum of the contribution by each when conducted independently.

Keywords: Asia; Transportation; Distribution; Costs; International trade; Geographical simulation; New economic geography; Trade cost (search for similar items in EconPapers)
JEL-codes: F15 O53 R15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp, nep-cwa, nep-int, nep-sea and nep-tre
Date: 2012-10-01
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Published in IDE Discussion Paper = IDE Discussion Paper, No. 369. 2012-10-01

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Journal Article: Geographical simulation analysis for logistics enhancement in Asia (2013) Downloads
Working Paper: Geographical Simulation Analysis for Logistics Enhancement in Asia (2013) Downloads
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