IDEAS home Printed from https://ideas.repec.org/a/wsi/ceprxx/v01y2012i02ns1793969012500094.html
   My bibliography  Save this article

International Trade And Its Effects On Economic Performance In China

Author

Listed:
  • ALMAS HESHMATI

    (Department of Food and Resource Economics, College of Life Sciences and Biotechnology East Building, Room 217, Korea University, Anam-dong Seongbuk-gu, Seoul, 136-713, Korea)

  • SUN PENG

    (LiaoNing Entry-Exit Inspection and Quarantine, Bureau of P.R. China, No. 81 RenMin Rode Dalian City, LiaoNing Province 116001, China)

Abstract

This research discusses the role of international trade in China's economic growth. It starts with a review of conceptions as well as the evolution of China's international trade regime and the policy that China has taken in favor of its trade sectors. China's international trade performance is analyzed extensively and its effects on efficiency in production evaluated. A stochastic frontier production function is applied, based on a balanced panel data of 31 provinces observed from 2002 to 2007. The production function model is estimated and province-specific determinants of inefficiency in trade are identified. The study demonstrates that increasing participation in global trade helps China reap static and dynamic benefits, stimulating rapid national economic growth. Both international trade volume and trade structure toward high-tech exports result in positive effects on regional productivity. Provinces differ by economic growth and participation in international trade. Policy implications are drawn from the empirical results accordingly.

Suggested Citation

  • Almas Heshmati & Sun Peng, 2012. "International Trade And Its Effects On Economic Performance In China," China Economic Policy Review (CEPR), World Scientific Publishing Co. Pte. Ltd., vol. 1(02), pages 1-26.
    • Handle: RePEc:wsi:ceprxx:v:01:y:2012:i:02:n:s1793969012500094
    DOI: 10.1142/S1793969012500094
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S1793969012500094
    Download Restriction: Access to full text is restricted to subscribers
    File URL: https://libkey.io/10.1142/S1793969012500094?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 search for a different version of it.

    References listed on IDEAS

    as
    1. Mr. Vivek Arora & Mr. Athanasios Vamvakidis, 2004. "How Much Do Trading Partners Matter for Economic Growth?," IMF Working Papers 2004/026, International Monetary Fund.
    2. Greeven, M.J., 2004. "The evolution of high-technology in China after 1978: Towards technological entrepreneurship," ERIM Report Series Research in Management ERS-2004-092-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    3. Doraszelski, Ulrich & Jaumandreu, Jordi, 2006. "R&D and productivity: Estimating production functions when productivity is endogenous," MPRA Paper 1246, University Library of Munich, Germany.
    4. Coe, David T. & Helpman, Elhanan, 1995. "International R&D spillovers," European Economic Review, Elsevier, vol. 39(5), pages 859-887, May.
    5. Kamal Saggi, 2002. "Trade, Foreign Direct Investment, and International Technology Transfer: A Survey," The World Bank Research Observer, World Bank, vol. 17(2), pages 191-235, September.
    6. anonymous, 1980. "Reserve Bank annual report," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 43, december.
    7. Keller, Wolfgang, 2001. "Knowledge Spillovers at the World's Technology Frontier," CEPR Discussion Papers 2815, C.E.P.R. Discussion Papers.
    8. Mr. Nicolas R Blancher & Mr. Thomas Rumbaugh, 2004. "China: International Trade and WTO Accession," IMF Working Papers 2004/036, International Monetary Fund.
    9. anonymous, 1980. "Public debt policy and open market operations," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 43, january/f.
    10. Fernando Garcia & Jorge Oliveira Pires, 2004. "Productivity of Nations: a stochastic frontier approach to TFP decomposition," Econometric Society 2004 Latin American Meetings 292, Econometric Society.
    11. Gemini, 1977. "Peking Revises Economic Policies," China Report, , vol. 13(2), pages 14-18, March.
    12. Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 1-118.
    13. Shiu, Alice & Heshmati, Almas, 2006. "Technical Change and Total Factor Productivity Growth for Chinese Provinces: A Panel Data Analysis," Ratio Working Papers 98, The Ratio Institute.
    14. Unknown, 1980. "UFW Contract: H. H. Maulhardt Packing Company," United Farm Workers (UFW) Contracts 236463, University of California, Davis, Changing Face.
    15. Blandy, Richard,, 1980. "Soft science: on thinking about population," ILO Working Papers 992044513402676, International Labour Organization.
    16. Joseph Y.S. Cheng, 1977. "Sino-Japanese Relations in Ikeda's Premiership," China Report, , vol. 13(2), pages 44-60, March.
    17. anonymous, 1980. "Studies in labor markets and utility pricing," Economic Review, Federal Reserve Bank of San Francisco, issue Win, pages 5-6.
    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. Asongu, Simplice & Odhiambo, Nicholas, 2020. "The role of Globalization in Modulating the Effect of Environmental Degradation on Inclusive Human Development," MPRA Paper 103143, University Library of Munich, Germany.
    2. Daniel Sakyi & José Villaverde & Adolfo Maza & Isaac Bonuedi, 2017. "The Effects of Trade and Trade Facilitation on Economic Growth in Africa," African Development Review, African Development Bank, vol. 29(2), pages 350-361, June.
    3. , Aisdl, 2020. "The Impact of Trade Facilitation on Vietnam’s Trade Flows," OSF Preprints uvw8p, Center for Open Science.
    4. Victor Ushahemba Ijirshar, 2022. "Trade Facilitation and Economic Growth Among Middle-Income Countries," Papers 2204.11088, arXiv.org.
    5. Shivneil Kumar Raj & Priteshni Pratibha Chand, 2017. "Analysis of Fiji’s Export and Its Impact on Economic Growth," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 7(4), pages 1-14, April.
    6. Shivneil Kumar Raj & Priteshni Pratibha Chand, 2017. "Analysis of Fiji’s Export and Its Impact on Economic Growth," International Journal of Business and Social Research, LAR Center Press, vol. 7(4), pages 1-14, April.

    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. Blalock, Garrick & Veloso, Francisco M., 2007. "Imports, Productivity Growth, and Supply Chain Learning," World Development, Elsevier, vol. 35(7), pages 1134-1151, July.
    2. Bos, Jaap W.B. & Economidou, Claire & Sanders, Mark W.J.L., 2013. "Innovation over the industry life-cycle: Evidence from EU manufacturing," Journal of Economic Behavior & Organization, Elsevier, vol. 86(C), pages 78-91.
    3. Alireza Naghavi & Chiara Strozzi, 2011. "Intellectual Property Rights, Migration, and Diaspora," Working Papers 2011.60, Fondazione Eni Enrico Mattei.
    4. Nasfi Fkili Wahiba, 2015. "Convergence and Divergence among Countries," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 5(3), pages 510-520, March.
    5. James B. Ang & Jakob B. Madsen, 2012. "Risk capital, private credit, and innovative production," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 45(4), pages 1608-1639, November.
    6. T. Gries & R. Grundmann & I. Palnau & M. Redlin, 2017. "Innovations, growth and participation in advanced economies - a review of major concepts and findings," International Economics and Economic Policy, Springer, vol. 14(2), pages 293-351, April.
    7. Hübler, Michael, 2011. "Technology diffusion under contraction and convergence: A CGE analysis of China," Energy Economics, Elsevier, vol. 33(1), pages 131-142, January.
    8. Mollick, André Varella & Cabral, René, 2009. "Productivity effects on Mexican manufacturing employment," The North American Journal of Economics and Finance, Elsevier, vol. 20(1), pages 66-81, March.
    9. Andrea Bassanini & Stefano Scarpetta, 2003. "The Driving Forces of Economic Growth: Panel Data Evidence for the OECD Countries," OECD Economic Studies, OECD Publishing, vol. 2001(2), pages 9-56.
    10. Francisco Alcalá & Antonio Ciccone, 2004. "Trade and Productivity," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 613-646.
    11. Dodzin, Sergei & Vamvakidis, Athanasios, 2004. "Trade and industrialization in developing economies," Journal of Development Economics, Elsevier, vol. 75(1), pages 319-328, October.
    12. Kutan, Ali M. & Yigit, Taner M., 2007. "European integration, productivity growth and real convergence," European Economic Review, Elsevier, vol. 51(6), pages 1370-1395, August.
    13. Krammer, Marius Sorin, 2008. "International R&D spillovers in transition countries: the impact of trade and foreign direct investment," Kiel Advanced Studies Working Papers 446, Kiel Institute for the World Economy (IfW Kiel).
    14. Juergen Antony, 2005. "Diffusion of Scale Effects between European Regions," Discussion Paper Series 281, Universitaet Augsburg, Institute for Economics.
    15. Wolfgang Keller & Stephen R. Yeaple, 2009. "Multinational Enterprises, International Trade, and Productivity Growth: Firm-Level Evidence from the United States," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 821-831, November.
    16. Lehner, Maria & Schnitzer, Monika, 2008. "Entry of foreign banks and their impact on host countries," Journal of Comparative Economics, Elsevier, vol. 36(3), pages 430-452, September.
    17. Zhang, Hui & Zhou, Peng & Sun, Xiumei & Ni, Guanqun, 2024. "Disparities in energy efficiency and its determinants in Chinese cities: From the perspective of heterogeneity," Energy, Elsevier, vol. 289(C).
    18. Fedderke, J.W. & Bogetic, Z., 2009. "Infrastructure and Growth in South Africa: Direct and Indirect Productivity Impacts of 19 Infrastructure Measures," World Development, Elsevier, vol. 37(9), pages 1522-1539, September.
    19. Pami Dua & B. N. GOLDAR & SMRUTI RANJAN BEHERA, 2011. "Foreign Direct Investment And Technology Spillover-- An Evaluation Across Different Clusters In India," Working papers 200, Centre for Development Economics, Delhi School of Economics.
    20. Quamrul Ashraf & Oded Galor, 2013. "The 'Out of Africa' Hypothesis, Human Genetic Diversity, and Comparative Economic Development," American Economic Review, American Economic Association, vol. 103(1), pages 1-46, February.

    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:wsi:ceprxx:v:01:y:2012:i:02:n:s1793969012500094. 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: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/cepr/cepr.shtml .

    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.