Abstract Two 2013

GLOBAL

DEVELOPMENT STUDIES

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Volume Seven Winter-Spring 2012-2013 Numbers 1-2.

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BILATERAL MARGINAL INTRA INDUSTRY TRADE (MIIT): SELECTED CARICOM CASES

Roger Hosein Ranita Seecharan

Senior Lecturer PhD. Student

Trade and Economic Trade and Economic

Development Unit Development Unit

Department of Economics Department of Economics

University of the West Indies University of the West Indies

St. Augustine, Trinidad St. Augustine, Trinidad

Published online: February 10, 2017

ABSTRACT

As the first functional regional integration arrangement for the Caribbean, the Caribbean Community (CARICOM) stands as a conduit for strengthening intra-regional trade. Concurrent variations in the intensity and pattern of intra CARICOM trade flows have spurred substantial research in this area. Much, if not all, of these empirical studies, though, have focused on the Heckscher Olin strand of trade theory with only a handful solely investigative of the second strand; that of intra industry trade. This burgeoning empirical gap has provided motivation to this article, which investigates the extent of bilateral marginal intra industry trade (MIIT) among five CARICOM trading partners: Trinidad and Tobago, Jamaica, Guyana, Barbados and St. Lucia. Five established indices are employed for the period 1973 to 2010 at the 3-digit level of disaggregation. Indeed, this article represents the first time an empirical study of this nature has been undertaken for the Caribbean in terms of time coverage, number of countries studied, and commodity composition. The article will also investigate the relative success of the CARICOM arrangement in engendering stronger intra industry trade (IIT); thereafter, relevant policy recommendations including establishing suitable transportation networks, an industrial cluster initiative based on an agro-tourism cluster, the development of special economic zones, and public private partnership initiatives will be purported to boost IIT within the region.