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DETERMINANTS OF INTERNATIONAL PRODUCTION FRAGMENTATION: MALAYSIA’S EXPERIENCE IN THE INFORMATION, COMMUNICATIONS AND TELECOMMUNICATIONS (ICT) INDUSTRY

ANDREW JIA-YI KAM

Institute of Malaysian and International Studies, The National University of Malaysia, 43600 UKM Bangi, Selangor D.E, Malaysia

E-mail Address: cchizz@yahoo.com

E-mail Address: Andrew@ukm.my

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https://doi.org/10.1142/S0217590815500423Cited by:1 (Source: Crossref)

Abstract

Although Malaysia has been an integral part of the international production fragmentation network since 1970, empirical investigations on the factors that determine the expansion of these networks are sparse. The paper examines the aforementioned empirical gap in the case of the Malaysian information, communications and telecommunications (ICT) sector using trade patterns in parts and components (PNC). Panel-data estimation from 1990 to 2008 suggests that mobile factors such as relative labor costs and productivity, foreign capital, agglomeration effect, infrastructure development and industrial policies are important in facilitating the international production fragmentation development. Income and domestic prices effect however, are conditional to trade flows.

Keywords:

JEL Classification: F10, F14, F23

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