ICT Dynamics and Regional Trade Bias in Asia: Theory and Empirical Aspects

ICT Markets in Asia are characterized by the strong role of sectoral foreign direct investment (FDI) inflows, namely from the US on the one hand, and from the EU on the other. Trade flows (determined here by examining trade flows as a percentage of total merchandise exports) differ in terms of regions: Southeast Asia, East Asia, Southern Africa, EU27 and North America; e.g., Southeast Asia recorded a fairly strong rise in intra-regional trade (relative to total merchandise trade). Also, the trade flows of Asian countries are biased with regard to the regions; the share of interregional trade of Asia's regions with the EU and North America have increased over time. In some Asian regions, trade in intermediate goods has decreased over time. Bavaria's regional ICT networks are interesting to consider in light of this finding. The panel data presented sheds new light on the benefits of regional R&D spending.