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Production networks and regionalism in East Asia: firms and states in the bilateral free trade agreements of Thailand and Malaysia

Postigo, Antonio (2013) Production networks and regionalism in East Asia: firms and states in the bilateral free trade agreements of Thailand and Malaysia. PhD thesis, London School of Economics and Political Science.

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Investment and trade flows across East Asia during the last three decades have fostered the development of production networks and economic integration. However, only since the turn of the century, have East Asian countries begun to institutionalize such integration through free trade agreements (FTAs). With the exception of Japan, the literature portrays East Asian FTAs as driven by political elites on primarily foreign policy motivations and with marginal participation of businesses in their formulation and utilization. Most of these narratives have, however, overlooked endogenous sources of trade preferences, shortcoming that this Thesis attempted to correct by analyzing how FTAs fit within the strategies of states and firms. The project investigated the mutual interaction between evolving trends within East Asian production networks and states’ and firms’ preferences on FTA liberalization using as case studies the bilateral FTAs negotiated by Thailand and Malaysia within the context of key production networks, particularly the automotive industry. Research involved extensive process-tracing through semi-structured interviews and trade data analyses. The main findings of this dissertation were: 1) Compared to multilateral liberalization, greater technical complexity and easier assessment of impacts in bilateral FTA negotiations resulted in more intense government-business consultations and corporate lobbying. Successive FTA negotiations strengthened the technical capacities of bureaucrats and firms and prompted the emergence of new institutional structures for intermediation and coordination among all actors; 2) Sectors that had successfully lobbied ex-ante for FTA liberalization and/or benefited from unilateral liberalization schemes have made extensive utilization of FTAs; 3) Governments and firms in both countries sought and extracted selective rents in FTAs to improve their relative position not only with respect to states and firms outside the bloc but also inside, and; 4) The interplay between overlapping FTA areas and the investment sunk in them shaped governments’ and firms’ positions on further FTA liberalization.

Item Type: Thesis (PhD)
Additional Information: © 2013 Antonio Postigo
Library of Congress subject classification: H Social Sciences > HD Industries. Land use. Labor
Sets: Departments > International Development
Supervisor: Shadlen, Kenneth C.

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