East Asian Production Networks, Trade, Exchange Rates, and Global Imbalances

Intricate value chains have emerged centered in East Asia. This project investigates the roles that Japan, China, South Korea, Association of Southeast Asian Nations (ASEAN) countries, United States, and other countries play within these networks.

Specific questions that it tackles include: 1) How do exchange rate changes, economic activity in the rest of the world, political considerations, and other factors affect exports from Asian countries and elsewhere; 2) How has the rise of China affected the rest of Asia and the rest of the world; 3) How have countries been able to advance to more complex products; 4) Do exchange rate changes affect exports of more complex products less than exports of other products; 5) How can Japan and East Asia deflect protectionist pressures that are threatening the world trading system; 6) To what extent are East and Southeast Asian country comrades, working together within production networks, and to what extent are they competitors, exporting similar products to third markets; 7) How sophisticated are exports from Japan, South Korea, Taiwan, China, and ASEAN, how close are the goods they produce to the technological frontier, and how they are progressing at moving up the ladder of comparative advantage; 8) What types of policies would promote growth and stability in Japan, Asia, and the rest of the world; 9) How have the rise of regional value chains, the Chinese economy, and other factors affected inflation in the world and the ability of central banks to hit their inflation targets; 10) What policy implications flow from the answers to the questions above.

February 1, 2018 - January 31, 2020