Economic integration in East Asia and Europe: lessons from a comparative analysis

This paper compares the economic integration processes of the European Union and the East Asian nations and comments on the possible reciprocal lessons, if any, that can be drawn to smooth the future paths of the two groups. The most relevant lessons on the EU side rely on strong institutionalization, structural policies, and the monetary union. Lessons from East Asia can be found in regional production networks, trade patterns, and the recent developments in financial cooperation. Both entities are presently facing difficult challenges to progress and growth

Backward vertical linkages of foreign manufacturing affiliates: Evidence from Japanese multinationals

We examine the determinants of backward vertical linkages established by multinational firms in host economies through an analysis of the local content ratio of 272 Japanese electronics manufacturing affiliates in 24 countries. Host country factors promoting vertical linkages are the quality of infrastructure and the size of the local components supply industry, while restrictive trade policies have a detrimental effect. Local content regulations have a positive impact but do not stimulate procurement from locally owned suppliers. Experienced affiliates, joint ventures and acquired affiliates, and-in less-developed economies-affiliates of less R&D-intensive firms exhibit more extensive vertical linkages. Firms belonging to Japanese vertical industrial groups (keiretsu) show higher procurement from local clusters of affiliated Japanese suppliers. (C) 2000 Elsevier Science Ltd. All rights reserved.status: publishe