Country-specific Determinants of Intra Industry Trade Types of Agricultural Sector in Selected Developing Countries

Regarding few studies of intra industry trade in the agricultural sector, this study have examined country-specific determinants of intra industry trade of agriculture in selected developing countries by using panel technique for trade data at 6-digit level of HS classification over time period 2001-2007. By employing Greenaway, Hine and Milner and Fontagné and Freudenberg approaches we’ve first divided intra industry trade into its types that is horizontal and vertical ones. Then, based on theoretical and empirical studies, we’ve estimated determinants of the types of intra industry trade. Overall and based on the results, it seems that the level of development and growth (Human development index) has a significant positive effect on intra industry trade of agriculture in countries under study. Also, the revealed comparative advantage has a significant positive effect on vertical intra industry trade and a significant negative effect on the horizontal intra industry trade in agricultural commodity groups. However, there is no definite result on the effect of exchange rate and trade openness.