Supply Chain Internationalization in East Asia: Inclusiveness and risks

Author Name FUJITA Masahisa  (President, RIETI) /HAMAGUCHI Nobuaki  (Faculty Fellow, RIETI)
Creation Date/NO. November 2014 14-E-066
Research Project Restoration from Earthquake Damage and Growth Strategies of the Japanese Regional Economy
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Supply chain internationalization is promoting a new cascade of agglomeration and dispersion. Headquarter tasks agglomerate in major cities in developed countries, while labor intensive tasks are shed to developing countries where offshored tasks form into a geographical concentration. As a whole, international supply chains are productivity and welfare enhancing through their more efficient use of human resources. This magnifies the cost of volatility. A case study on East Asia illustrates these points.