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The Trade and Welfare Effects of State Trading in China with Reference to COFCO

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  • Steve McCorriston
  • Donald MacLaren

Abstract

The use of state trading to manage imports and exports has been a long‐standing feature of China’s agricultural trade regime. While the use of state trading was modified by China’s accession to the WTO, state trading still dominates for some commodities, even though there have been recent attempts to diminish its importance. In this paper, we analyse the potential trade distorting effect of COFCO on market access and export competition by drawing on some recent research on the impact of STEs on agricultural trade. By using a calibrated model of China’s imports of wheat and exports of maize, we are able to quantify the size of the trade distortions.

Suggested Citation

  • Steve McCorriston & Donald MacLaren, 2010. "The Trade and Welfare Effects of State Trading in China with Reference to COFCO," The World Economy, Wiley Blackwell, vol. 33(4), pages 615-632, April.
    • Handle: RePEc:bla:worlde:v:33:y:2010:i:4:p:615-632
    DOI: 10.1111/j.1467-9701.2009.01237.x
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    References listed on IDEAS

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    1. Elena Ianchovichina & Will Martin, 2004. "Impacts of China's Accession to the World Trade Organization," The World Bank Economic Review, World Bank, vol. 18(1), pages 3-27.
    2. Steve McCorriston & Donald MacLaren, 2005. "Reforming trade-distorting state trading enterprises," Chapters, in: Sisira Jayasuriya (ed.), Trade Theory, Analytical Models and Development, chapter 8, Edward Elgar Publishing.
    3. Steve McCorriston & Donald MacLaren, 2007. "Deregulation as (Welfare Reducing) Trade Reform: the Case of the Australian Wheat Board," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(3), pages 637-650.
    4. McCorriston, Steve & MacLaren, Donald, 2007. "Do state trading exporters distort trade?," European Economic Review, Elsevier, vol. 51(1), pages 225-246, January.
    5. Steve McCorriston & Donald MacLaren, 2008. "State Trading Enterprises as an Impediment to Improved Market Access: The Case of the Korean Rice Market," Review of International Economics, Wiley Blackwell, vol. 16(3), pages 431-443, August.
    6. McCorriston, Steve & MacLaren, Donald, 2005. "Single-desk state trading exporters," European Journal of Political Economy, Elsevier, vol. 21(2), pages 503-524, June.
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    Cited by:

    1. Yoon, Jung-hyun & Lim, Song Soo, 2013. "Potential trade distortion effects of state trading enterprises under the tariff-rate quota scheme," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 7, pages 1-19.

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