IDEAS home Printed from https://ideas.repec.org/a/bla/worlde/v28y2005i4p607-625.html
   My bibliography  Save this article

Exports, Foreign Direct Investment and Employment: The Case of China

Author

Listed:
  • Xiaolan Fu
  • V. N. Balasubramanyam

Abstract

This paper analyses the growth of production and employment in China during the period 1978 to the early 1990s. It argues that the Chinese experience with export‐led growth provides an excellent case study of the phenomenon of a vent for surplus resources provided by exports, identified by Adam Smith in the Wealth of Nations and elaborated by Hla Myint. The paper extends the Smith‐Myint model of ‘vent‐for‐surplus’ productive capacity to ‘vent‐for‐surplus’ resources by allowing for foreign investment flows. The ‘vent‐for‐surplus’ effect of exports on employment and growth is examined in a dynamic labour demand framework for a panel of township and village enterprises (TVEs) in China.

Suggested Citation

  • Xiaolan Fu & V. N. Balasubramanyam, 2005. "Exports, Foreign Direct Investment and Employment: The Case of China," The World Economy, Wiley Blackwell, vol. 28(4), pages 607-625, April.
    • Handle: RePEc:bla:worlde:v:28:y:2005:i:4:p:607-625
    DOI: 10.1111/j.1467-9701.2005.00694.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-9701.2005.00694.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-9701.2005.00694.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Bowlus, Audra J. & Sicular, Terry, 2003. "Moving toward markets? Labor allocation in rural China," Journal of Development Economics, Elsevier, vol. 71(2), pages 561-583, August.
    2. Greenaway, David & Hine, Robert C. & Wright, Peter, 1999. "An empirical assessment of the impact of trade on employment in the United Kingdom," European Journal of Political Economy, Elsevier, vol. 15(3), pages 485-500, September.
    3. Xiaolan Fu, 2004. "Exports, Foreign Direct Investment and Economic Development in China," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-51483-6, October.
    4. Milner, Chris & Wright, Peter, 1998. "Modelling Labour Market Adjustment to Trade Liberalisation in an Industrialising Economy," Economic Journal, Royal Economic Society, vol. 108(447), pages 509-528, March.
    5. Edward J. Chambers & Donald F. Gordon, 1966. "Primary Products and Economic Growth: An Empirical Measurement," Journal of Political Economy, University of Chicago Press, vol. 74(4), pages 315-315.
    6. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    7. Kiviet, Jan F., 1995. "On bias, inconsistency, and efficiency of various estimators in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 68(1), pages 53-78, July.
    8. Ingrid H. Rima, 2004. "China's trade reform: Verdoorn's Law married to Adam Smith's "vent for surplus" principle," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 26(4), pages 729-744.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xiaolan Fu & V.N.Balasubramanyam, 2004. "Exports, FDI, Growth Of Small Rural Enterprises And Employment In China," Working Papers wp286, Centre for Business Research, University of Cambridge.
    2. Giovanni S.F. Bruno & Anna M. Falzoni & Rodolfo Helg, 2004. "Measuring the effect of globalization on labour demand elasticity: An empirical application to OECD countries," KITeS Working Papers 153, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Feb 2004.
    3. Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2015. "The own-wage elasticity of labor demand: A meta-regression analysis," European Economic Review, Elsevier, vol. 80(C), pages 94-119.
    4. Kunal Sen, 2009. "International Trade and Manufacturing Employment: Is India following the Footsteps of Asia or Africa?," Review of Development Economics, Wiley Blackwell, vol. 13(4), pages 765-777, November.
    5. Lucio Castro & Daniel Saslavsky, 2008. "Trade with China and India and Manufacturing Labour Demand in Argentina," WIDER Working Paper Series RP2008-108, World Institute for Development Economic Research (UNU-WIDER).
    6. Njikam, Ousmanou, 2016. "Trade liberalization, labor market regulations and labor demand in Cameroon," International Review of Economics & Finance, Elsevier, vol. 43(C), pages 525-541.
    7. Nursel AYDINER‐AVSAR & ÖZlem ONARAN, 2010. "The Determinants Of Employment: A Sectoral Analysis For Turkey," The Developing Economies, Institute of Developing Economies, vol. 48(2), pages 203-231, June.
    8. Castro, Lucio & Olarreaga, Marcelo & Saslavsky, Daniel, 2006. "The impact of trade with China and India on Argentina’s manufacturing employment," MPRA Paper 538, University Library of Munich, Germany.
    9. Kunal Sen, 2008. "International Trade and Manufacturing Employment Outcomes in India: A Comparative Study," WIDER Working Paper Series RP2008-87, World Institute for Development Economic Research (UNU-WIDER).
    10. Sèna Kimm Gnangnon, 2020. "Aid for Trade and sectoral employment diversification in recipient-countries," Economic Change and Restructuring, Springer, vol. 53(2), pages 265-295, May.
    11. Tran Nhuan KIEN & Yoon HEO, 2009. "Impacts Of Trade Liberalization On Employment In Vietnam: A System Generalized Method Of Moments Estimation," The Developing Economies, Institute of Developing Economies, vol. 47(1), pages 81-103, March.
    12. Novella Bottini & Michael Gasiorek, 2009. "Trade and Job Reallocation: Evidence for Morocco," LIUC Papers in Economics 224, Cattaneo University (LIUC).
    13. Rajesh Raj S.N. & Subash Sasidharan, 2015. "Impact of Foreign Trade on Employment and Wages in Indian Manufacturing," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 16(2), pages 209-232, September.
    14. Lihong Yun, 2008. "Technical Progress and Labour Demand in Swedish Manufacturing Firms," Journal of Industry, Competition and Trade, Springer, vol. 8(2), pages 147-167, June.
    15. Sanjaya Kumar Malik, 2019. "Foreign Direct Investment and Employment in Indian Manufacturing Industries," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 62(4), pages 621-637, December.
    16. Eicher, Theo S. & Schreiber, Till, 2010. "Structural policies and growth: Time series evidence from a natural experiment," Journal of Development Economics, Elsevier, vol. 91(1), pages 169-179, January.
    17. Serge Coulombe, 2008. "Employment Adjustments in High-Trade-Exposed Manufacturing in Canada," Working Papers 0803E, University of Ottawa, Department of Economics.
    18. Kappeler, Andreas & Solé-Ollé, Albert & Stephan, Andreas & Välilä, Timo, 2013. "Does fiscal decentralization foster regional investment in productive infrastructure?," European Journal of Political Economy, Elsevier, vol. 31(C), pages 15-25.
    19. Emna Trabelsi, 2016. "Transparency on inflation of OECD countries? An Application of LSDVC Estimator on a dynamic Panel Model," Economics Bulletin, AccessEcon, vol. 36(2), pages 1095-1126.
    20. Christoph S. Weber, 2018. "Central bank transparency and inflation (volatility) – new evidence," International Economics and Economic Policy, Springer, vol. 15(1), pages 21-67, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:worlde:v:28:y:2005:i:4:p:607-625. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0378-5920 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.