Bilateral trade imbalances in East Asia threaten regional economic stability.
The article explores how trade agreements between China, Vietnam, and Japan affect their economies in East Asia. By using a global economic model, the researchers found that initial differences between these countries can lead to varying outcomes in their trade relationships. Without policies promoting balanced trade, some partners may face negative consequences. The study suggests that fostering trade patterns where each country's total trade grows faster than their overall trade can help maintain economic equilibrium.