Classification of the ASEAN+3 Economies Using Fuzzy Clustering Approach

Abstract

The success story of the EU in establishing a single market in 1999 have motivated ASEAN+3 region to further integrate their economy. It is therefore interesting to assess whether the ASEAN+3 economies may be seen as a single major entity or actually as a number of significantly different clusters. This study attempts to classify members of ASEAN+3 countries into clusters, employing the Fuzzy Clustering Approach. The results show that the countries can be classified into five clusters. Singapore, Japan, Korea, and China can be seen as the leading economies in the region. Moreover, our analysis using data before, during and after the Asian Financial Crisis seems to be consistent. Therefore, in order for the single market to function effectively, when taking initiatives these countries should consider limitations and bottlenecks faced by other countries within the region.