IDEAS home Printed from https://ideas.repec.org/a/eee/streco/v62y2022icp660-674.html
   My bibliography  Save this article

Do country centrality and similarity to China matter in the allocation of belt and road projects?

Author

Listed:
  • Damoah, Kaku Attah
  • Giovannetti, Giorgia
  • Marvasi, Enrico

Abstract

We analyze the relationship between trade patterns and the allocation of investment projects carried out under the China-led Belt and Road Initiative (BRI). Rooted on a novel database, we construct the intermediate trade network and assess its role in the allocation of the projects. Investments tend to concentrate in countries located in central nodes of the international production networks as well as towards suppliers of intermediate goods whose revealed comparative advantage overlaps with China. High income countries closer to destination markets tend to attract fewer but larger investments. Controlling for gravity variables as well as for political proximity to China adds explanatory power without affecting the results on the importance of trade. The BRI represents an opportunity for China to upgrade its exports and for the countries receiving investments to enhance their participation in Global Value Chains (GVC) with possible positive impacts on development.

Suggested Citation

  • Damoah, Kaku Attah & Giovannetti, Giorgia & Marvasi, Enrico, 2022. "Do country centrality and similarity to China matter in the allocation of belt and road projects?," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 660-674.
  • Handle: RePEc:eee:streco:v:62:y:2022:i:c:p:660-674
    DOI: 10.1016/j.strueco.2022.05.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0954349X22000674
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.strueco.2022.05.002?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
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. de Soyres, François & Mulabdic, Alen & Ruta, Michele, 2020. "Common transport infrastructure: A quantitative model and estimates from the Belt and Road Initiative," Journal of Development Economics, Elsevier, vol. 143(C).
    2. Coşar, A. Kerem & Demir, Banu, 2016. "Domestic road infrastructure and international trade: Evidence from Turkey," Journal of Development Economics, Elsevier, vol. 118(C), pages 232-244.
    3. Andres,Luis Alberto & Biller,S. A. Dan & Herrera Dappe,Matias, 2014. "Infrastructure gap in South Asia : infrastructure needs, prioritization, and financing," Policy Research Working Paper Series 7032, The World Bank.
    4. Steven Brakman & Peter Frankopan & Harry Garretsen & Charles Van Marrewijk, 2019. "The New Silk Roads: an introduction to China’s Belt and Road Initiative," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 12(1), pages 3-16.
    5. Xiaoyang Chen,Maggie & Lin,Chuanhao, 2018. "Foreign Investment across the Belt and Road : Patterns, Determinants, and Effects," Policy Research Working Paper Series 8607, The World Bank.
    6. Vinokurov, Evgeny & Lobyrev, Vitaly & Tikhomirov, Andrey & Tsukarev, Taras, 2018. "Silk Road Transport Corridors: Assessment of Trans-EAEU Freight Traffic Growth Potential," MPRA Paper 86184, University Library of Munich, Germany.
    7. Alicia Garcia Herrero & Jianwei Xu, 2017. "China's Belt and Road Initiative: Can Europe Expect Trade Gains?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 25(6), pages 84-99, November.
    8. Nicholas Crafts, 2009. "Transport infrastructure investment: implications for growth and productivity," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 25(3), pages 327-343, Autumn.
    9. Daria Taglioni & Deborah Winkler, 2016. "Making Global Value Chains Work for Development," World Bank Publications - Books, The World Bank Group, number 24426.
    10. Jackson, Karen & Shepotylo, Oleksandr, 2021. "Belt and road: The China dream?," China Economic Review, Elsevier, vol. 67(C).
    11. Baniya, Suprabha & Rocha, Nadia & Ruta, Michele, 2020. "Trade effects of the New Silk Road: A gravity analysis," Journal of Development Economics, Elsevier, vol. 146(C).
    12. de Soyres, François & Mulabdic, Alen & Murray, Siobhan & Rocha, Nadia & Ruta, Michele, 2019. "How much will the Belt and Road Initiative reduce trade costs?," International Economics, Elsevier, vol. 159(C), pages 151-164.
    13. Huang, Yiping, 2016. "Understanding China's Belt & Road Initiative: Motivation, framework and assessment," China Economic Review, Elsevier, vol. 40(C), pages 314-321.
    14. Luca De Benedictis & Lucia Tajoli, 2011. "The World Trade Network," The World Economy, Wiley Blackwell, vol. 34(8), pages 1417-1454, August.
    15. Julian Donaubauer & Alexander Glas & Birgit Meyer & Peter Nunnenkamp, 2018. "Disentangling the impact of infrastructure on trade using a new index of infrastructure," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 154(4), pages 745-784, November.
    16. Reed,Tristan & Trubetskoy,Alexandr, 2019. "Assessing the Value of Market Access from Belt and Road Projects," Policy Research Working Paper Series 8815, The World Bank.
    17. Aggarwal, Shilpa, 2018. "Do rural roads create pathways out of poverty? Evidence from India," Journal of Development Economics, Elsevier, vol. 133(C), pages 375-395.
    18. John H Dunning, 1980. "Towards an Eclectic Theory of International Production: Some Empirical Tests," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 11(1), pages 9-31, March.
    19. Ben Derudder & Xingjian Liu & Charles Kunaka, 2018. "Connectivity Along Overland Corridors of the Belt and Road Initiative," World Bank Publications - Reports 30609, The World Bank Group.
    20. Le Chang & Jing Li & Kee-Cheok Cheong & Lim-Thye Goh, 2021. "Can Existing Theories Explain China’s Outward Foreign Direct Investment in Belt and Road Countries," Sustainability, MDPI, vol. 13(3), pages 1-17, January.
    21. Tania Ghossein & Bernard Hoekman & Anirudh Shingal, 2018. "Public Procurement in the Belt and Road Initiative," World Bank Publications - Reports 31069, The World Bank Group.
    22. Du, Julan & Zhang, Yifei, 2018. "Does One Belt One Road initiative promote Chinese overseas direct investment?," China Economic Review, Elsevier, vol. 47(C), pages 189-205.
    23. Boffa,Mauro, 2018. "Trade linkages between the belt and road economies," Policy Research Working Paper Series 8423, The World Bank.
    24. Irene (E) Anastasiadou, 2019. "Iron Silk Roads: the geopolitics of past and present initiatives for the revival of Eurasian trade through overland transport corridors," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 12(1), pages 57-75.
    25. Nugent, Jeffrey B. & Lu, Jiaxuan, 2021. "China's outward foreign direct investment in the Belt and Road Initiative: What are the motives for Chinese firms to invest?," China Economic Review, Elsevier, vol. 68(C).
    26. Dwight H. Perkins, 2015. "Understanding the Slowing Growth Rate of the People's Republic of China," Asian Development Review, MIT Press, vol. 32(1), pages 1-30, March.
    27. Stephan Barisitz & Alice Radzyner, 2017. "The New Silk Road, part I: a stocktaking and economic assessment," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue Q3/17, pages 8-30.
    28. Lobyrev, Vitaly & Tikhomirov, Andrey & Tsukarev, Taras & Vinokurov, Evgeny, 2018. "Belt and Road Transport Corridors: Barriers and Investments," MPRA Paper 86705, University Library of Munich, Germany.
    29. Marcus Bartley Johns & Julian Latimer Clarke & Clay Kerswell & Gerard McLinden, 2018. "Trade Facilitation Challenges and Reform Priorities for Maximizing the Impact of the Belt and Road Initiative," World Bank Publications - Reports 30477, The World Bank Group.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ayadi, Rym & Giovannetti, Giorgia & Marvasi, Enrico & Zaki, Chahir, 2024. "Trade networks and the productivity of MENA firms in global value chains," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 10-23.
    2. Kashif Iqbal & Muddassar Sarfraz & Khurshid, 2023. "Exploring the role of information communication technology, trade, and foreign direct investment to promote sustainable economic growth: Evidence from Belt and Road Initiative economies," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(3), pages 1526-1535, June.

    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. Kaku Attah Damoah & Giorgia Giovannetti & Enrico Marvasi, 2023. "Five Stylized Facts on Belt and Road Countries and Their Trade Patterns," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(1), pages 149-181, January.
    2. Feng, Yusen & Wang, Gang-Jin & Zhu, You & Xie, Chi, 2023. "Systemic risk spillovers and the determinants in the stock markets of the Belt and Road countries," Emerging Markets Review, Elsevier, vol. 55(C).
    3. World Bank, 2020. "South Caucasus and Central Asia - The Belt and Road Initiative," World Bank Publications - Reports 34121, The World Bank Group.
    4. Cristina Di Stefano & P. Lelio Iapadre & Ilaria Salvati, 2021. "Trade and Infrastructure in the Belt and Road Initiative: A Gravity Analysis Based on Revealed Trade Preferences," JRFM, MDPI, vol. 14(2), pages 1-15, January.
    5. Jackson, Karen & Shepotylo, Oleksandr, 2021. "Belt and road: The China dream?," China Economic Review, Elsevier, vol. 67(C).
    6. Lu, Shuai & Chen, Ning & Zhou, Wei & Li, Shouwei, 2024. "Impact of the belt and road initiative on trade status and FDI attraction: A local and global network perspective," International Review of Economics & Finance, Elsevier, vol. 89(PA), pages 1468-1495.
    7. World Bank, 2020. "South Caucasus and Central Asia - The Belt and Road Initiative," World Bank Publications - Reports 34118, The World Bank Group.
    8. World Bank, 2020. "South Caucasus and Central Asia - The Belt and Road Initiative," World Bank Publications - Reports 34119, The World Bank Group.
    9. Nugent, Jeffrey B. & Lu, Jiaxuan, 2021. "China's outward foreign direct investment in the Belt and Road Initiative: What are the motives for Chinese firms to invest?," China Economic Review, Elsevier, vol. 68(C).
    10. World Bank, 2020. "South Caucasus and Central Asia - The Belt and Road Initiative," World Bank Publications - Reports 34122, The World Bank Group.
    11. World Bank, 2020. "South Caucasus and Central Asia - The Belt and Road Initiative," World Bank Publications - Reports 34120, The World Bank Group.
    12. Koffi Dumor & Li Yao, 2019. "Estimating China’s Trade with Its Partner Countries within the Belt and Road Initiative Using Neural Network Analysis," Sustainability, MDPI, vol. 11(5), pages 1-22, March.
    13. de Soyres, François & Mulabdic, Alen & Murray, Siobhan & Rocha, Nadia & Ruta, Michele, 2019. "How much will the Belt and Road Initiative reduce trade costs?," International Economics, Elsevier, vol. 159(C), pages 151-164.
    14. Jeffrey B. Nugent & Jiaxuan Lu, 2020. "Does the All-China Federation of Industry and Commerce Align Private Firms with the Goals of the People's Republic of China's Belt and Road Initiative?," Asian Development Review, MIT Press, vol. 37(2), pages 45-76, September.
    15. Linda Calabrese & Rhys Jenkins & Lorena Lombardozzi, 2024. "The Belt and Road Initiative and Dynamics of Structural Transformation," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 36(3), pages 515-547, June.
    16. Ahmad, Zofia & Chicoine, Luke, 2021. "Silk Roads to Riches: Persistence Along an Ancient Trade Network," MPRA Paper 105146, University Library of Munich, Germany.
    17. Wang, Banban & Lin, Ping, 2022. "Whether China's overseas energy infrastructure projects dirtier or cleaner after the belt and road initiative?," Energy Policy, Elsevier, vol. 166(C).
    18. Krishna Chaitanya Vadlamannati & Yuanxin Li & Samuel Brazys & Alexander Dukalskis, 2019. "Building Bridges or Breaking Bonds? The Belt and Road Initiative and Foreign Aid Competition," Working Papers 201906, Geary Institute, University College Dublin.
    19. Yang Gao, 2022. "The Belt and Road Initiative and cascading innovation in China’s domestic railway ecosystem," Journal of International Business Policy, Palgrave Macmillan, vol. 5(2), pages 236-258, June.
    20. Claudio Ferrari & Alessio Tei, 2020. "Effects of BRI strategy on Mediterranean shipping transport," Journal of Shipping and Trade, Springer, vol. 5(1), pages 1-18, December.

    More about this item

    Keywords

    Belt and Road; China; Global value chains; Trade in intermediates; Network-centrality;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

    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:eee:streco:v:62:y:2022:i:c:p:660-674. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/525148 .

    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.