The dynamics of agricultural intra-industry trade: a comprehensive case study in Vietnam

Abstract

Intra-industry trade (IIT) and trade dynamics play rising roles in the international economic literature recently. This article investigates Vietnam’s agricultural IIT defined by GLI in the world markets and the dynamics of GLI indicators by using the OLS method, Markov matrix, trend analysis, and piecewise regression. The paper finally tests the relationship between IIT and trade specialization. The results indicate that Vietnam’ agricultural sector has the inter-industry trade with 42 sectors rather than the intra-industry trade with only 19 sectors. But the IIT pattern generally tends to increases over time. The dynamics analyses show that Vietnam’s intra-industry trade is relatively dynamic and it mainly bases on the structural changes in the economy. The study provides empirical evidence in Vietnam that intra-industry trade and trade specialization seems to be inversely correlated.