Date of Award

Summer 2020

Document Type

Open Access Thesis

Department

Moore School of Business

First Advisor

William R. Hauk

Abstract

This study primarily attempts to investigate the causal relationship between Global Production Sharing and economic growth. Secondarily, the study attempts to identify the impact of Preferential Trade Agreements on Global Production Sharing. The study is based on secondary data for a panel of 12 Asian countries for the time period from 1999 to 2017. The methodology adopted for the study is both quantitative and qualitative. The empirical methodology is based on Cobb-Douglas production function, and panel fixed effects estimator is employed to derive the consistent estimates. The empirical findings of the study suggest that Global Production Sharing has a positive relationship with economic growth. The estimates of fixed effects model suggest that 10 percent increase in Global Production Network trade is associated with 1 percent increase in Gross Domestic Production Per Capita. More importantly, the study found that Global Production Sharing can enhance the economic development with implications of raised revenue, more employment and poverty reduction. Further, based on the review of literature, the study reveals that although the deep Preferential Trade Agreements can increase the countries’ participation in production sharing, different tariff structures pertinent to different Preferential Trade Agreement member countries can hamper the utilization of an optimal Global Production Network due to different Rules of Origin. Finally, the study advocates for an innovative global trade paradigm empowered by the unilateral trade liberalization in order to safeguard the free trade economic phenomenon.

Rights

© 2020, Handunnetti Naveen Mendis Wickremeratne

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