The Role of Intra-Industry Trade in the Service Sector

Robert C. Shelburne, United Nations Economic Commission for Europe
Jorge Gonzalez, Trinity University

Abstract

The role of intra-industry trade (IIT) in the service sector is examined. Methodological issues in calculating IIT indexes for the service sectors are discussed. A new generalized index for dealing with the negative numbers that are often present in the data is provided. The different hierarchical structure of the services data provided by the OECD and the US BEA are discussed. The factors that explain the level of services IIT across countries are explored, as well as the factors that affect the level of IIT in U.S. bilateral trade with other nations.