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China in the International Segmentation of Production Processes

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Author Info
Francoise Lemoine
Deniz Unal-Kesenci

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Abstract

This structural analysis of China's foreign trade shows that its outstanding performance in world markets is directly linked to its involvement in the international segmentation of production processes. China's tariff policy in favour of processing activities proved very successful in creating export-oriented industries based on imported inputs. Production sharing with Asian countries has resulted in highly internationalised and competitive industries, while China's traditional export sector has remained sluggish. China displays a strong specialisation in the downstream stages of production processes, associated with large deficits in the upstream stages (semi-finished products and components). This vertical division of production has enabled China to rapidly diversify its exports of consumption goods, and to create strengths in capital goods exports, especially in electrical machinery. Imports of parts and components embody a large share of high technology and represent an important channel for the transfer of technology into China.

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Paper provided by CEPII research center in its series Working Papers with number 2002-02.

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Date of creation: Mar 2002
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Handle: RePEc:cii:cepidt:2002-02

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Related research
Keywords: China; Trade policy; Economic integration; Specialisation; International segmentation of production processes; Technology transfer;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
F15 - International Economics - - Trade - - - Economic Integration
O53 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Feenstra, R.C. & Hanson, G.H., 1995. "Foreign Investment, Outsourcing and Relative Wages," Department of Economics 95-14, California Davis - Department of Economics.
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  2. Wolfgang Keller, 2001. "The Geography and Channels of Diffusion at the World's Technology Frontier," NBER Working Papers 8150, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Hertel, Thomas W. & Terrie Walmsley, 2000. "China's Accession to the WTO: Timing is Everything," GTAP Working Papers 403, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University. [Downloadable!]
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  4. Coe, David T & Helpman, Elhanan & Hoffmaister, Alexander, 1995. "North-South R&D Spillovers," CEPR Discussion Papers 1133, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  5. Ng, Francis & Yeats, Alexander, 1999. "Production sharing in East Asia : who does what for whom, and why?," Policy Research Working Paper Series 2197, The World Bank. [Downloadable!]
  6. Zhi Wang, 1999. "The Impact of China's WTO Entry on the World Labour-intensive Export Market: A Recursive Dynamic CGE Analysis," The World Economy, Blackwell Publishing, vol. 22(3), pages 379-405, 05. [Downloadable!] (restricted)
  7. Guillaume Gaulier, 2001. "Discrimination commerciale : une mesure a partir des flux bilateraux," Working Papers 2001-04, CEPII research center. [Downloadable!]
  8. Coe, David T. & Helpman, Elhanan, 1995. "International R&D spillovers," European Economic Review, Elsevier, vol. 39(5), pages 859-887, May. [Downloadable!] (restricted)
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  9. Feenstra, Robert C & Hanson, Gordon H, 1996. "Globalization, Outsourcing, and Wage Inequality," American Economic Review, American Economic Association, vol. 86(2), pages 240-45, May. [Downloadable!] (restricted)
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  10. Michael Freudenberg & Francoise Lemoine, 1999. "Central And Eastern European Countries In The International Division Of Labour In Europe," Working Papers 1999-05, CEPII research center. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Sandra Poncet, 2004. "A Fragmented China," Tinbergen Institute Discussion Papers 04-103/2, Tinbergen Institute. [Downloadable!]
  2. Francoise Lemoine & Deniz Unal-Kesenci, 2003. "Trade and Technology Transfers: a Comparative Study of Turkey, India and China," Working Papers 2003-16, CEPII research center. [Downloadable!]
  3. Amador, João & Cabral, Sónia, 2008. "Vertical specialization across the world: a relative measure," MPRA Paper 9618, University Library of Munich, Germany. [Downloadable!]
  4. Amador, João & Cabral, Sonia & Ramos Maria, Jose, 2007. "Relative Export Structures and Vertical Specialization: A Simple Cross-Country Index," MPRA Paper 6208, University Library of Munich, Germany. [Downloadable!]
  5. Christer Ljungwall & Örjan Sjöberg, 2005. "The Economic Impact of Globalization in Asia-Pacific - The Case of The Flying Geese," Development Economics Working Papers 659, East Asian Bureau of Economic Research. [Downloadable!]
  6. Sanjaya Lall and Manuel Albaladejo (QEH), . "China’s Competitive Performance: A Threat To East Asian Manufactured Exports?," QEH Working Papers qehwps110, Queen Elizabeth House, University of Oxford. [Downloadable!]
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  7. Amador, João & Cabral, Sónia, 2008. "International fragmentation of production in the Portuguese economy: What do different measures tell us?," MPRA Paper 9783, University Library of Munich, Germany. [Downloadable!]
  8. Sanjaya Lall, Manuel Albaladejo and Jinkang Zhang (QEH), . "Mapping Fragmentation: Electronics and Automobiles in East Asia and Latin America," QEH Working Papers qehwps115, Queen Elizabeth House, University of Oxford. [Downloadable!]
    Other versions:
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