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The Degree of Openness to Intra-Regional Trade - Towards Value-Added Based Openness Measures

Author

Listed:
  • Belke Ansgar

    (Chair of International Economics, University of Hohenheim, D-70593 Stuttgart, Germany)

  • Wang Lars

    (Dir. oec. Department of Economics, University of Hohenheim, D-70593 Stuttgart, Germany)

Abstract
This study develops innovative measures of openness towards bilateral trade. The most widely applied openness indices are not able to accurately calculate the degree of trade openness. For example, the intra-regional export ratio which relates the value of exports of an integration area to the gross domestic product, can exceed 100 percent because trade is stated in gross terms, while the gross domestic product is expressed in value-added terms. This implies a negative value of domestic non-tradeables. The actual openness concept corrects the traditional concept by expressing trade in value-added terms instead of gross terms.

Suggested Citation

  • Belke Ansgar & Wang Lars, 2006. "The Degree of Openness to Intra-Regional Trade - Towards Value-Added Based Openness Measures," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 226(2), pages 115-138, April.
    • Handle: RePEc:jns:jbstat:v:226:y:2006:i:2:p:115-138
    DOI: 10.1515/jbnst-2006-0202
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    References listed on IDEAS

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    Cited by:

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    2. Saleh Mothana Obadi, 2007. "Regionálna integrácia a intra-regionálny obchod: komparatívna analýza [Regional integration and intra-regional trade: a comparative analysis]," Politická ekonomie, Prague University of Economics and Business, vol. 2007(1), pages 41-59.
    3. repec:hal:wpspec:info:hdl:2441/5l6uh8ogmqildh09h4dj9499g is not listed on IDEAS
    4. Susanne Mueller‐Using & Wieslaw Urban & Jan Wedemeier, 2020. "Internationalization of SMEs in the Baltic Sea Region: Barriers of cross‐national collaboration considering regional innovation strategies for smart specialization," Growth and Change, Wiley Blackwell, vol. 51(4), pages 1471-1490, December.
    5. repec:spo:wpmain:info:hdl:2441/5l6uh8ogmqildh09h4dj9499g is not listed on IDEAS
    6. Jingyi Wang & Shuguang Liu & Yubin Zhao, 2023. "Spatial–Temporal Evolution and Driving Factors of Economic Dual Circulation Coordinated Development in China’s Coastal Provinces," Sustainability, MDPI, vol. 15(14), pages 1-21, July.
    7. repec:spo:wpecon:info:hdl:2441/5l6uh8ogmqildh09h4dj9499g is not listed on IDEAS
    8. repec:dgr:rugsom:14004-eef is not listed on IDEAS
    9. Abo-Zaid Salem M, 2011. "The Trade-Growth Relationship in Israel Revisited: Evidence from Annual Data, 1960-2004," Review of Middle East Economics and Finance, De Gruyter, vol. 6(3), pages 63-93, February.
    10. repec:hal:spmain:info:hdl:2441/5l6uh8ogmqildh09h4dj9499g is not listed on IDEAS
    11. Wen Chen & Lizhi Xing, 2022. "Measuring the Intermediate Goods’ External Dependency on the Global Value Chain: A Case Study of China," Sustainability, MDPI, vol. 14(7), pages 1-21, April.
    12. Halit Yanikkaya & Abdullah Altun, 2018. "Once Again, Trade Openness and Growth: Are Trade in Value Added Concepts Different?," Working Papers 2018-01, Gebze Technical University, Department of Economics.
    13. Bouwmeester, Maaike C. & Oosterhaven, Jan & Rueda-Cantuche, Jos, 2014. "Measuring the EU value added embodied in EU foreign exports by consolidating 27 national supply and use tables for 2000-2007," Research Report 14004-EEF, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    14. Johnson, Robert C. & Noguera, Guillermo, 2012. "Accounting for intermediates: Production sharing and trade in value added," Journal of International Economics, Elsevier, vol. 86(2), pages 224-236.

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    More about this item

    Keywords

    Degree of openness; openness to intra-regional trade; bilateral trade; value-added approach; input-output analysis;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • F15 - International Economics - - Trade - - - Economic Integration
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission

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