Emerging Asian Economies and MNCs Strategies
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Emerging Asian Economies and MNCs Strategies

  • New Horizons in International Business series

Edited by Robert Taylor and Bernadette Andreosso-O’Callaghan

Analysing the role of multinational investors in emerging Asian economies and the implications for regional economic integration, this astute study examines the increasing role being played by Asian countries in the global economy. Encompassing a large number of diverse manufacturing and service sectors, this book highlights the cultural and strategic challenges faced by multinational investors in the region in which they invest. It shows that despite high rates of economic growth in Asian countries presenting multinational traders and investors with unparalleled market opportunities, there have been only tentative moves towards regional economic integration. Areas such as trade facilitation, uniform customs clearance, removal of non-tariff barriers and labour deployment issues are yet to be adequately addressed.
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Chapter 5: A correlation of China’s economic growth and trade structure induced by transaction costs

Zhao Guoqin and Sam Dzever

Abstract

Transaction cost has emerged as a core concept in the New Institutional Economics (NIE) and an important theoretical tool for researchers in this field. Measuring transaction costs and the quantitative analysis of the relationship between transaction costs and other economic indicators has become a central theme of analysis in the NIE. By measuring China’s macroscopic transaction costs since 1978 and utilizing a dynamic econometric model, this chapter analyzes the relationship between macroscopic transaction costs and China’s economic growth and trade structure changes. The findings suggest that in the mid- and long-term, growth in China’s macroscopic transaction costs does stimulate exports while restraining domestic trade. Thus, macroscopic transaction costs can be said to have indirectly changed China’s trade structure leading to the persistent surplus it has recorded against its major trading partners over the last few years. Key words: macroscopic transaction costs, economic growth, trade structure changes, Chinese economy.

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