Trade Barriers and Participation in the Global Value Chain: An Empirical Study Based on Anti‐dumping toward China

This paper investigates the effects of trade barriers on China's participation in the global value chain (GVC) using a thorough decomposition approach for trade volume, total exports, final exports and intermediate exports. Our econometric results indicate that anti‐dumping (AD) measures initiated by trade partners have restrained the process of China's participation in the GVC. From 2000 to 2014, AD measures reduced the foreign value‐added rate of total, final and intermediate exports by 4.5 to 28.7 percent, 3.4 to 17 percent and 1.2 to 8.5 percent, respectively. In addition, suffering the effects of AD measures, China's GVC position index declined by 8.2 percent to 28.6 percent during this period. Moreover, AD measures have increased industries' upstream index by 3.2 to 13.7 percent over the same period. These results imply that both the petition and approval of AD cases has had a negative influence on the extent and position of China's GVC participation.     

The impact of China's trade liberalisation on the greenhouse gas emissions of WTO countries

We examine the effects of China's trade liberalisation, post entry into the WTO, on the greenhouse-gas (GHG) emissions of its trading partners. Using complementary estimators we establish that China's liberalised trade had significant effects on the GHG emissions of its trading partners. Increased exposure to Chinese exports increased the growth of consumption-based emissions while reducing production-based emission. The increase in consumption-based emissions was larger than the decrease in production emissions. Consumption emissions increased both through a scale effect (consumption increased) and a composition effect (consumption became more emissions intensive). Decomposition analysis suggests that the link between exposure to Chinese exports and the increase consumption-based emissions is the emissions embodied in imports: The emissions embodied in imports increased and imports became more emissions intensive. The increase in imported emissions was not offset by a reduction in domestic production of emissions either in final consumption goods or exports. (JEL: Q53, Q54, Q55).     

International trade,FDI (foreign direct investment) and embodied CO2 emissions: A case study of Chinas industrial sectors

This paper calculates CO₂ emissions embodied in China's international trade using an input–output analysis, for the period 2000–2010. Based on industrial panel data, the two-step GMM estimation is used to test the impacts of FDI, trade openness, exports, imports and per capita income on CO₂ emissions. The results suggest that: (1) China's growing trade surplus is one of the important reasons for the rapidly rising CO₂ emissions; (2) large FDI inflows further aggravate China's CO₂ emissions; and (3) the industrial sector's per capita income and CO₂ emission relationship show inverted-U environmental Kuznets curve. Therefore, in order to achieve environmentally sustainable development of the economy, China should make efforts to transform its trade growth mode, adjust foreign investment structure, strengthen energy efficiency and develop a low-carbon economy.     

CO2 Emissions Embodied in China＇s Foreign Trade： An Investigation from the Perspective of Global Vertical Specialization

In light of the growth in vertically specialized in global trade, the present paper uses input output tables from the World Input-Output Database to construct an environmental multi regional input-output model to calculate the CO2 emissions embodied in China＇s international trade during 1995-2009. The advantage of this model lies in its incorporation of the re exported CO2 emissions component embodied in trade and its ability to differentiate domestic sourced CO2 emissions from foreign-sourced CO2 emissions in trade. The results show that carbon emissions embodied in both China＇s exports and imports increased significantly during 1995-2009. One important reason for this is that the re-exported carbon emissions embodied in China＇s imported intermediate inputs increased substantially during this period. Our research reveals that accelerating the transformation of trade pattern and upgrading processing trade should be emphasized in the formulation of policy to prompt CO 2 emissions abatement in China.     

Processing trade,exchange rates and China's bilateral trade balances

This paper analyzes the role of processing trade in China's bilateral trade balances and the impact of the yuan's appreciation on China's processing trade. The analysis is based on panel data covering bilateral processing trade between China and its partners from 1993 to 2008. The empirical results show that: (1) processing trade accounted for 100% of China's annual trade surplus during the period; (2) China's processing trade showed a significant regional bias—77% of processing imports originated from East Asia while only 29% of processing exports was destined to the region in 2008; and (3) a real appreciation of the yuan would negatively affect both processing imports and exports—specifically, a 10% real appreciation of the yuan would reduce not only China's processing exports by 9.1% but also its processing imports by 5.0%. Based on these empirical findings we conclude that the combined effect of the yuan's appreciation on the balance of processing trade and thus China's overall trade balance will be limited.     

China＇s Import-exchange Rate Linkage： Evidence from the China-bound Exports of Japan and Korea

This paper examines how the China-bound exports of Japan and Korea are related to exchange rates, motivated by the fact that processing trade makes up a large proportion of China＇s trade, and that Japan and Korea are the leading source countries for processing imports. Because processing imports are inputs for exports, the link between such imports and China＇s exchange rates are ambiguous. We estimate export functions that include China＇s RMB real effective exchauge rates （REER） along with bilateral real exchange rates （B RER） using Johausen ＇s cointegration method aud find that the RMB REER significantly affects Japanese and Korean exports to China, even more so than BRER in most cases examined. These two exchange rates appear in the export equations with opposite signs. Subsequently, we use the estimated model to illustrate the importance of accounting for a concurrent change in B RER when analyzing the effects of a hypothetical RMB revaluation on China＇s trade balances despite the apparently weak imports-B RER linkage.     

Forest endowment,logging restrictions,and China's wood products trade

This paper uses the gravity model to investigate determinants of China's wood products trade from 1995 to 2004. The results suggest that trade partners' forest resource endowment and China's own logging restrictions policy affect its wood products imports and exports. China's exported wood products are shown to be inferior goods while China's imported wood products are labor intensive for the exporting countries. Due to rises in Chinese currency against other major currency, transportation costs, and foreign trade actions, China's wood products exports and imports may slow down. The results may have implications on trade and global forest resource conservation.     

What are China's real gains within global value chains? Measuring domestic value added in China's exports of manufactures

This paper aims to investigate China's gains of participating in global value chains (GVCs) in terms of GDP in exports (DVA - domestic value added) and the factors affecting China's gains. The paper decomposes the gross exports of China so as to get the components that make up total GDP in the exports of the country, namely the value-added exports and DVA that are returned from abroad. Then the two components are measured to obtain the scale of GDP in China's exports both on country and sector level. The results show that, firstly, both value-added exports and the GDP in China's exports are less than the traditional gross trade statistics, indicating that there is a gap of real trade gains under GVCs. Secondly, comparing whether the proportion of DVA in total exports, the proportion of DVA in exports of manufactures or the proportion of RDV in total DVA, the gaps between China and the developed countries such as the United States, Germany and Japan do exist. Especially, considering the RDV of China, the proportion is significantly lower than that of major developed countries such as the United States and Germany, indicating that China lags far behind developed countries in the capabilities of supplying high value-added intermediate goods. Lastly, the empirical results suggest that DVA in China's exports has progressively increased in response to the productivity enhancement; research and development (R&D) inputs and capital formation, and the synergies between R&D and vertical specialization affect China's DVA growth in exports positively.     

Remedy or Poison: Impacts of China's Outward Direct Investment on Its Exports

During the past decade, China's outward direct investment (ODI) and exports have experienced rapid growth, drawing increasing attention to the relationship between them. Using the gravity model based on panel data on China's ODI and trade to 174 countries and regions during 2003–2012, the present paper investigates the impacts of China's ODI on exports. We find that China's ODI to a host country significantly promotes China's trade with that economy: a 10‐percent increase in ODI stock can lead to a 2.14‐percent increase in exports, a 2.07‐percent increase in imports and a 2.87‐percent increase in net exports. The scale of the host country's economy, its infrastructure and its distance to China also have significant impacts on China's exports. Therefore, growth in ODI will facilitate China's trade and integration into the global economy, and enhance industrial upgrading in China by transferring the low‐end industries abroad.     

Estimation of China＇s Embodied CO2 Emissions during 2000-2009

The problem of CO₂ embodied in international trade has attracted increasing attention in China. To analyze this issue, the present paper directly calculates emission factors for 15 industries in 2002, 2005 and 2007. We then examine a consumption‐based system and a single‐region input–output model to estimate China's embodied emissions during 2000–2009. Our results show that, when a consumption‐based system is adopted, China's emissions are lower than those reported by some international organizations. The rapid growth in China's exports is a key determinant of China's rising total emissions. All countries should strengthen their cooperation in improving their current greenhouse gas inventories. Furthermore, China needs to encourage trade in low‐carbon products and technology.     

Effects of China's Structural Change on the Exports of East Asian Economies

The Chinese economy is slowing down and is in the midst of a structural transformation from export‐led and investment‐led growth to domestic demand‐led and consumption‐led growth. While there are widespread concerns among China's trading partners about the effect of the slowdown in China's growth on their exports, China's structural changes are also likely to have a significant impact: for example, China will import fewer machines and more cosmetics. The central objective of the present paper is to empirically examine the effect of China's structural transformation on the exports of East Asian economies, which have close trade linkages with China. We find that economies that have failed to increase the share of consumption goods in their exports to China have suffered larger declines in their quantities of exports to China. In addition, economies that have suffered losses in their shares of China's parts and components imports have faced reductions in their shares in China's total imports.     

US and China aid to Africa: Impact on the donor-recipient trade relations

This paper investigates the impact of the US and China's foreign aids to Africa on trade flows between donor and recipient countries. Evidence from the gravity model estimates reveals that the two donors' exports are strengthened by their aids to African partners. Interestingly, China's aid shows a positive effect on its total volume of trade and imports from Africa, while the aid from the US exhibits little impact on the US-Africa total trade and its imports from Africa. A possible explanation for such a difference could be due to the dissimilar national interests of donors in Africa. This study finally suggests that African countries should accelerate the pace of advancing domestic economies and rely less on foreign assistance, in order to establish a fairer and more equal international economic order.     

Economic Benefits and Environmental Costs of China's Exports: A Comparison with the USA Based on Network Analysis

This paper decomposes economic benefits (value‐added) and environmental costs (CO₂) of exports according to their sources, and maps the global value network (GVN) and the global emissions network (GEN) for China's exports during 1995–2009 from national, sectoral and national–sectoral perspectives. A comparison is conducted between China and the USA. National GVN and GEN show that shares of value‐added and CO₂ emissions from China in its GVN and GEN both decreased first then increased after 2006, while shares from the USA in its GVN and GEN generally decreased. Sectoral GVN and GEN show that among China's exports, “electrical and optical equipment” and “electricity, gas and water supply” were, respectively, the sectors that obtained the most value‐added and emitted the most CO₂. National–sectoral GVN and GEN for China exhibited reciprocal and disassortative patterns, and in‐strengths and out‐strengths of GVN and GEN for China's exports were mainly captured by several domestic country–sector pairs.     

增加值视角下金砖国家制造业的贸易利得与竞争力研究

基于贸易增加值核算的基本原理,对金砖五国制造业出口增加值进行分解,同时利用标准显示性竞争指数测算金砖国家制造业竞争力,研究发现：中国的贸易利得与庞大的出口总额严重不匹配,其他金砖四国的贸易利得远远高于中国;对中国、巴西和印度而言,基于国内增加值测算的NRCA值要高于基于出口总额测算的NRCA值,而俄罗斯和南非恰恰相反;金砖五国在低技术制造业上表现出各自的竞争优势,除了中国在电子通信和光学设备制造业及机械制造业有相对的竞争优势外,金砖五国整体上在高技术产业层面与美日德等发达国家存在较大差距。应从培育高级要素、产能合作、共建科技创新体系等方面来提高金砖国家制造业竞争力。     

China's Competitive Performance: A Threat to East Asian Manufactured Exports?

We examine China's competitive threat to East Asian neighbors in the 1990s, benchmarking performance by technology and market. Market share losses are mainly in low-technology products; Japan is the most vulnerable market. China and its neighbors are raising high-technology exports in tandem: international production systems here are leading to complementarity rather than confrontation. In direct trade with its neighbors, China is acting as an engine of export growth, with imports outpacing exports. This may change, however, as China climbs the value chain and takes over activities that have driven East Asian export growth even within integrated production systems.     

Understanding China's demand for resource imports

Is China's demand for resources driven predominantly by domestic factors or by global demand for its exports? The answer to this question is of interest given the highly resource-intensive nature of China's growth, and is important for many resource-exporting countries, such as Australia, Brazil, Canada and India. This paper provides evidence that China's (mainly manufacturing) exports have been a significant driver of its demand for resource commodities over recent decades. First, it employs input–output tables to demonstrate that, historically, manufacturing has been at least as important as construction as a driver of China's demand for resource-intensive metal products. Second, it shows that global trade in non-oil resource commodities can be described by the gravity model of trade. Using this model it is found that, controlling for other determinants of resource trade, exports (and the manufacturing sector more generally) are a sizeable and significant determinant of a country's resource imports, and that this has been true for China as well as for other countries.     

Is the Chinese Economy Moving in the Direction of Tertiarization？

Drawing upon output, employment, consumption and trade data, this article examtnes whether there is an economic tertiarization trend in China ＇s economy and evaluates the common factors driving current trends. It shows that the tertiarization trend is evident for the overall economy and most regions in terms of the service nominal value-added ratio and service employment and consumption. However, the tertiarization trend is not significant in terms of the service real value-added ratio, and there is even some concurrent ＂detertiarization ＂ because of the decreasing proportion of services in imports and exports. lndeed, China ＇s tertiarization trend is far behind its industrialization trend The rise in the relative prices of services explains the rising proportion of household service consumption expenditure and further illuminates why the service real value-added ratio has not grown. The main cause for the growing percentage of service employment is the lag in service labor productivity growth in interaction with the price inelasticity of service demand ＂Cost disease ＂ has appeared in service consumption.     

Trade in factor income and the US-China trade balance

US multindoational enterprises sell considerable amounts of products to China's domestic consumers that are “made” in either China or other countries. However, these sales are not counted as US exports to China. To account for this, we propose a beyond-borders approach to measuring trade flows that explicitly considers firm ownership, termed “trade in factor income (TiFI),” that defines the US-owned factor income induced by China's final demand as US exports to China. Applying this approach to OECD data, we find that on average from 2005 to 2016 in TiFI terms, US exports to China were 20.34% and 8.21% greater, China's exports to the US were 1.64% and 16.04% less, and the US trade deficits with China were 17.4% and 32.0% less than the trade figures reported in value added and gross terms, respectively. The concept of TiFI transforms trade measures from a territory-based “made in” label to a factor income-based “created by” label.     

Global production networks and China's processing trade

This paper unveils a systematic pattern in China's processing trade. In a cross-section of Chinese provinces, the average distance traveled by processing imports (import distance) is negatively correlated to the average distance traveled by processing exports (export distance). To explain this pattern, we set up a three-country industry-equilibrium model in which heterogeneous firms from two advanced countries, East and West, sell their products in each other's markets. Each firm can use two modes to serve the foreign market. It can directly export its products from its home country. Alternatively, it can indirectly export to the foreign market by assembling its product in a third low-cost country, China, which is located in the vicinity of East. Our model establishes two theoretical predictions relating China's geographical location to its processing trade patterns. First, China's processing exports are negatively affected by both an increase in import distance and a rise in export distance. Second, China's processing exports to East Asian countries are more sensitive to export distance and less sensitive to import distance than its processing exports to non-Asian countries. We find empirical support for both predictions.     

The roles of cultural and institutional distance in international trade: Evidence from China's trade with the Belt and Road countries

Cultural distance and institutional distance have been playing increasingly significant roles in international trade. Recently, the Belt and Road Initiative (BRI) proposed by China has drawn worldwide attention. This paper examines the roles of cultural distance and institutional distance in China's trade relationship with the Belt and Road (B&R) countries. We estimate the extended gravity model using bilateral trade data at product-level during 2002–2016 between China and 99 trading partners, 38 of which are along the Belt and Road. Using Poisson generalized estimating equations (GEE) econometric methods, we find that firstly, cultural distance and institutional distance inhibit China's bilateral trade with the Belt and Road countries. Secondly, China's bilateral trade with the B&R countries is more sensitive to the change of cultural distance than institutional distance by comparing their beta coefficients. Thirdly, compared to Asian countries on the Belt and Road, bilateral trade flows between China and European countries show less sensitivity to changes in cultural distance, except China's imports from its trading partners. While the trade effects of institutional distance show no difference between China's trade with European countries and Asian countries. Lastly, the announcement of BRI does reduce trade-inhibiting effect of cultural distance on China's trade with the Belt and Road countries, while increase China's exports sensitivity to institutional distance. This study finally suggests relevant cultural exchange driven by the BRI eventually assisting unimpeded trade and deepening the cooperation.