What＇s So Special about China＇s Exports？

I. Introduction The phenomenal performance of China constitutes the great economic miracle of the last quarter century. China’s economy has expanded by leaps and bounds, at historically unprecedented rates that few economists would have found plausible or feasible ex ante. More importantly, this growth has lifted hundreds of millions of people from deep poverty and has helped improve health, education and other social standards. China has accomplished all this using its own brand of experime…     

What＇s So Special about China＇s Producer Services？ An Input-output Analysis

In the present study, five stylized facts about China ＂s producer services are established through international, intersectoral and intertemporal comparisons based on input --output tables. First, the overall service input ratio is the lowest in all the sample economies. Second, most producer services are supplied by the traditional labor-intensive sectors. Third, manufacturing is the biggest user of producer services, and service industry is the second, while the opposite is true for most of the other sample economies. Fourth, unlike other economies, China ＂s ＂R＆D＂ is characterized more by consumer services than producer services. Fifth, China has fairly lower service input ratios in almost all the industries. The backward and forward linkages coefficients are both smaller for ＂real estate activities＂ and ＂finance and insurance. ＂＂ Policy reform should focus not only on specific producer services but also on reducing obstacles that are inhibiting the balanced development of diverse producer services that will help China to optimize its economic structure.     

Why Are Chinese Exports Not So Special？

Applying a commonly used index for export sophistication in a cross-country study, Rodrik finds that the technological content of Chinese exports over the past decade has been so high that it cannot be explained simply by the economic fundamentals of a low-income country abundant with unskilled labor. Question has been raised for the empirical robustness of the index. I am also doubtful with Rodrik＇ s analysis but develop my argument from a different perspective. This paper briefly reviews Rodrik＇s methodology and identifies other factors his empirical results potentially hinge on. Based on this, it elaborates on China＇ s unique processing trade regime, the uneven distribution of its exports across Chinese regions and the limitation of HS codes in terms of identifying differentiated products, in an attempt to show that these factors also contribute to higher estimations of China＇s export sophistication level. Finally, it organizes trade data to reveal the trade patterns that are indeed consistent with the country＇s comparative advantage.     

The Research on the Relation between China＇s Accession to WTO and China＇s Economic Development under the Theory of Comparative Advantage

According to the theory of comparative advantage, the relation between China＇s accession to WTO and China＇s economic development is studied. And a positive conclusion is presented in this article.     

Can China＇s Labor Comparative Advantage Last？

The paper discovers the source of china＇s labor comparative advantage by international comparison and demonstrates whether this advantage can last long from the aspects of both theories and facts. Based on analysis, the paper thinks the labor cost advantage in China mainly results from a low-cost labor level, which doesn＇t have any advantage actually compared to some other developing countries. According to the factor-price equalization theorem and empirical data, it＇s hard for China＇s labor cost advantage to last long .To keep it, China has to improve its labor efficiency and added value ratio.     

China＇s Changing Trade Elasticities

China ＇s sectoral trade composition, product quality mix, and the import content of processing exports have all changed substantially during the past decade. This has rendered trade elasticities estimated using aggregate data highly unstable, with more recent data pointing to significantly higher demand and price elasticities. Sectoral differences in these parameters are also very wide. All this suggests greater caution should be exercised when using historical data to simulate the response of China＇s economy to external shocks and exchange rate changes. Analyses based on models with estimated coefficients largely representative of China in the 1980s and 1990s are likely to turn out to be wrong, perhaps even dramatically.     

Income and Price Elasticities of China＇s Exports

The appearance of new product varieties and improvements in the quality of goods have both played key roles in the rapid growth of China's exports. However, these two important elements have not been formally integrated into the demand equations for China's exports. As we demonstrate in this paper, income elasticity will be underestimated if new varieties of goods and quality improvements are omitted in price index and quantity index calculations, which are necessary for estimating the export demand function. Moreover, the faster new product varieties enter export markets, the greater the underestimation will be. In this paper, we develop an export demand equation that takes into account new product varieties and improvements in quality, and then calculate the demand function for China's exports using the data from 1992 to 2006. According to our estimation, the short‐term income elasticity of demand for China's exports is approximately 2.34, and the short‐term price elasticity is approximately –0.65. Our estimation predicts an increase in China's export value in the case of an RMB appreciation or export rebate rates reduction in the short term, due to the low price elasticity of China's exports, whose absolute value is less than 1. Our findings are novel and could have significant policy implications.     

Evolutionary Characteristics of China＇s Intermediate Manufactures

China's economic development is characterized by progressive integration with international production chains as an assembly producer. Japan and South Korea are the major partners providing intermediate products to China. The present paper analyzes the Chinese intermediate sector's present condition and evolutionary characteristics revealed in bilateral trade with Japan and South Korea. The analysis uses the framework of new trade theory represented by “intra‐industry trade”. Trade statistics from 1997 to 2004 are analyzed using the database published by the OECD. Results show that China's inter‐industrial evolution is characterized by its expanding positioning in the manner of the flying geese development paradigm of Asian countries. Furthermore, intra‐industrial evolution is characterized by a concentration on price competitiveness. The framework and results of the industrial analysis presented in this paper assist in the understanding of China's manufacturing evolution and of the policy‐making decisions taken in the process.     

Analysis of China＇s Foreign Trade Growth and Discussion of Related Policies

China’s foreign trade experienced three consecutive years of super-speed growth in 2002-2004, even though the country was stricken by the SARS epidemic in 2003 and power shortages in 2004. What has gone beyond expectations is that the exports trade still grew with momentum after the central government lowered the export rebate rates by an average of 3 percentage points, starting from January 2004. Such growth momentum is apparently associated with external demand and the performance of the domestic macroeconomy, and even more associated with a series of support policies. This paper tries to raise issues issues associated with these policies on the basis of an analysis of foreign trade performance in 2002-2004, in order to enhance understanding of the advantages and disadvantages of these policies, and to recommend a new line of thought for improving policy arrangements for the growth of import and export trade and for the harmonious development of the macroeconomy.     

Does the Domestic Value Added Induced by China＇s Exports Really Belong to China？

Since 2001, the exports of foreign‐invested enterprises (FIEs) have accounted for more than 50 percent of China's total exports. As foreign capital occupies a high proportion of the total capital of FIEs, most FIEs' capital gains are foreign factor income. Although these gains are calculated as a part of China's GDP, they do not belong to China's national income. To determine the real contribution of exports to China's welfare, the present paper analyses the impact of exports on China's national income using a non‐competitive input–output model capturing processing trade. The results show that every US$1000 of China's exports generates US$506.8 of national income. The real contribution of exports to China's welfare is much smaller than what we expected. This suggests that China should endeavor to improve the gains from international markets or find another engine to maintain its economic growth.     

What Causes China＇s High Inflation？ A Threshold Structural Vector Autoregression Analysis

China＇s astonishing economic growth implies a necessity to understand its inflation. The present paper employs threshold nonrecursive structural vector autoregression analysis to explore the asymmetric effects of macro-variables on inflation in low and high inflation regimes. The empirical evidence demonstrates, first, that the reactions of inflation to various shocks are inflation-regime-dependent and asymmetric. Second, monetary policy influences China ＂s high inflation and adjusting the domestic interest rate in China may be an effective way to control inflation in a high inflation regime, but not in a low inflation regime. In a high inflation regime, a high inflation rate may cause the macro-policy authorities to increase the domestic interest rate, in an attempt to stabilize high inflation. Third, contrary to expectations, the world oil price is not a strong cost-push factor in a low inflation regime. Oil price increases may increase inflation in a high inflation regime, but there is no such obvious effect in a low inflation regime. Finally, China ＂s nominal effective exchange rate influences inflation in both low and high inflation regimes. A nominal effeetive exchange rate appreciation might be effective in controlling domestic inflation in both regimes.     

Foreign Value-added in China＇s Manufactured Exports： Implications for China＇s Trade Imbalance

Economists have recently become interested in weighting how much domestic value-added is actually included in China’s exports.Formally,the proportion of foreign and domestic contents could be identified by calculating the vertical specialization share using non-competitive input-output tables.Applying such a method to the Chinese case,however, would result in a big measurement bias because China has a large share of processing exports,which utilize a disproportionately high percentage of imported intermediates.This paper,by directly employing 2008 trade data for which imported intermediates in both processing and non-processing trade could be identified by means of various trade patterns, provides a simplified way to estimate the share of foreign/domestic value-added included in industry-level manufactured exports.This paper finds that the vertical specialization share of China’s processing exports was about 56 percent in 2008,compared to about 10 percent for ordinary exports.It also finds that the sectors that experiencedfast expansion of processing exports have a much higher share of foreign contents.Since processing exports account for about half of Chinese exports,the prevailing trade statistics,which focus on gross values rather than the value-added of exports and imports,has obviously overstated the bilateral trade imbalances,especially between China and the USA.     

Global Quota System and China＇s Textile and Clothing Industry

I. Introduction As a developing country, textile and clothing goods remain one of the most important sources of China’s exports since the opening up to the outside world and economic reform at the end of the 1970s. The contribution of textile and clothing exports to China’s total exports hit its record in the middle of the 1980s. In 1987, the share of these two types of goods in China’s total exports was 31.13 percent. From 1986 to 1995, their share in China’s exports was more than 30 pe…     

China＇s Macroeconomic Development： Stages and Nonlinear Convergence

I. Introduction Since the second half of the 1990s, the Chinese economy has witnessed some unprecedented changes: a sharp increase in urban unemployment, stagnation of labor transfer from agriculture to non-agricultural sectors and serious deflation. All these changes indicate a significant departure from the previous development trajectory: sustained full employment in urban areas, rapid labor transfer from agriculture to non-agricultural sectors and persistent and significant inflation. Beg…     

China＇s Foreign Trade： Achievements,Determinants and Future Policy Challenges

Over the past twenty-five years, China‘s foreign trade has achieved great success. The main determinants behind this success include market-oriented reform, appropriate trade and exchange rate policies, and the active participation of foreign-invested enterprises. However, China is far from completing the transition in trade structure, and is facing many difficult policy challenges in maintaining its export momentum into the future.     

Research on reform tactics of China＇s oil price forming mechanism

The main problem the oil industry facing in modem market economy is unreasonable price mechanism, the substance of which should be attributed to the fact that it is still short of a reasonable oil price forming mechanism. Therefore, the discussion on this aspect should be pushed forward. As the breakthrough point, on the basis of status research in quo and formation causes of China＇s oil price forming mechanism, we should analyze the necessity and imminence of China＇s oil price forming mechanism reform deeply. Then, with the perspective of development strategy of the oil industry, we put forward the reform measures of it.     

Elasticity of Energy Demand and Challenges for China＇s Energy Industry

I. Introduction Since late 2002, China’s energy demand and resources have become one of the most prominent issues in international discussions of energy. In our earlier studies of China’s energy demand as relates to transportation and urbanization (Gates and Yin, 2002; Yin and Gates, 2002), we took more of a long-term view and raised the possibility that even if China’s economy continued to grow rather slowly, which was the prevailing perception at the time, there would still be strong d…     

Imports and Exports by Customs Regime——April 2003

US$1,000CommodityExportsImportsPercentage ChangeT0talIIPrimaryproductsO.F00d and live animals1.Beverages and tobacco2.Crude materials,inedible,except fuels3.Mineral fuels。lubricants and related materials4.Animal and vegetable oils。fats and WSXe8II.Manufactures5.Chemicals and related products6.Manufactured goods classified e~efly by material7.Machinery and transport equipment8 Miscellaneous manufactured articles9.Commodities and transactions not classified35.617,074 2,958.405 1,351.…     

Development in China＇s Foreign Trade： 2003-2012

China＇s foreign trade has entered a new stage, marked by some profound changes since 2003. After 5 years ＇consecutive high growth, China＇s foreign trade experienced a significant slowdown in growth following the onset of the global financial crisis in 2008. The purpose of this article is to present a review of the development in China＇s foreign trade over the past l O years, and to explore important changes that have taken place during this period of time. A majorfinding of the presentpaper is that the traditional forces driving the high export growth in China, that is, low-cost labor, low-cost resources and low-cost money, have been disappearing. The policy implication is that over the next l O-15 years, the most important conditions for sustaining high export growth will be promoting the development and export of private enterprises in traditional heaw industries and high-technology industries, and relying on technological progress and high produc6vity to propel export expansion.     

China＇s Trade Acceleration and the Deepening of an East Asian Regional Production Network

China＇s recent surge in trade has been associated with its deepening but contrasting trade relations with its two groups of key trading partners. On the one hand, China＇ s trade surpluses with the USA and the EU have risen rapidly, reaching US$144bn and US$91bn in 2006, respectively. On the other hand, China is importing heavily from its Asian neighbors. This diverging pattern of trade relations between China and its main trading partners reflects the continuous expansion and intensification of a complex cross-border production network in Asia, particularly for consumer electronics. In the process of deepening manufacturing sharing, China serves as an essential export platform for firms headquartered in the more advanced economies. These firms export intermediate goods from the relatively more advanced Asian economies to their affiliates in China where these inputs are assembled and then shipped to key export markets, including primarily the USA and the EU. One apparent outcome of the growing processing and assembly trade is the increased interdependency among Asian economies, which are now more dependent on each other than ever. It has also led to substantial structural changes and technological upgrading in China＇ s traded goods.