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Behind the heterogeneous trade effects of standards: Multi-sector evidence from China

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  • Ni, Shiying
  • Bai, Xiwen
  • Li, Lefei

Abstract

Standards can influence trades via multiple channels, such as signaling effects, common language effects, and compliance costs. We argue that the impacting channels of standards differ across sectors, which originates from diverse sector features and results in heterogeneous trade effects of standards. In this paper, we focus on the trade effects of standards in developing countries as exporters. Gravity models are applied on the panel data of China’s bilateral trades in 33 sectors from 2002 to 2016. We examine the moderating role of sector features, including the intensity of capital, labor, and technology, on the trade effects of standards. We find that trade-promoting effects of standards are stronger in high-capital sectors and weaker in high-labor sectors. In high-tech sectors, the trade-promoting effects are stronger for internationally harmonized standards while weaker for national standards. Our findings provide managerial implications on standardization policies for China and other developing countries. For instance, international harmonization of standards should be highlighted in high-tech sectors.

Suggested Citation

  • Ni, Shiying & Bai, Xiwen & Li, Lefei, 2022. "Behind the heterogeneous trade effects of standards: Multi-sector evidence from China," Journal of Asian Economics, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:asieco:v:82:y:2022:i:c:s1049007822000690
    DOI: 10.1016/j.asieco.2022.101513
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    More about this item

    Keywords

    Standards; International trade; Gravity model;
    All these keywords.

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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