IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/331127.html
   My bibliography  Save this paper

Export Tax Rebates and Real Exchange Rate Devaluation: China's Experience in Recent Asia Financial Crisis -- A Computable General Equilibrium Analysis

Author

Listed:
  • Yu, Eden
  • Chao, Chi-Chur
  • Wang, Zhi

Abstract

This paper analyzes the relation between real exchange rate devaluation and export tax rebates based on China’s experience in recent Asian financial crisis by a 47 sector single country China CGE model which differentiates processing and normal trade explicitly. Two simulation scenarios are conducted. In the first scenario, we depreciate China’s real exchange rate exogenously in the order of 5 percent, and endogenously solve its global trade balance. Base on a study published by Institute of International Economics in 1998, such a real devaluation would be sufficient for China to re-attain its pre-crisis competitiveness in global market. In the second scenarios, we fix China’s real exchange rate in the pre-crisis level, but allow China’s export rebate rate adjust endogenously to achieve a global trade balance for China same with that in the first scenario. The simulation results indicate a 30 percent increase of export tax rebate rate or a 55 percent increase of government export tax rebate expense from the base year have a similar impact of 5 percent real exchange rate devaluation in terms of restoring China’s export competitiveness.

Suggested Citation

  • Yu, Eden & Chao, Chi-Chur & Wang, Zhi, 2003. "Export Tax Rebates and Real Exchange Rate Devaluation: China's Experience in Recent Asia Financial Crisis -- A Computable General Equilibrium Analysis," Conference papers 331127, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331127
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/331127/files/1318.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Naqvi, Farzana & Peter, Matthew W, 1996. "A Multiregional, Multisectoral Model of the Australian Economy with an Illustrative Application," Australian Economic Papers, Wiley Blackwell, vol. 35(66), pages 94-113, June.
    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. Maheshwar Rao & Robert Tanton & Yogi Vidyattama, 2013. "‘A Systems Approach to Analyse the Impacts of Water Policy Reform in the Murray-Darling Basin: a conceptual and an analytical framework’," NATSEM Working Paper Series 13/22, University of Canberra, National Centre for Social and Economic Modelling.
    2. Horridge, Mark & Madden, John & Wittwer, Glyn, 2005. "The impact of the 2002-2003 drought on Australia," Journal of Policy Modeling, Elsevier, vol. 27(3), pages 285-308, April.
    3. Peter B. Dixon & Maureen T. Rimmer, 2004. "Measuring Contributions To The Australian Economy: The Benefits Of A Fast-Growing Motor Vehicle And Parts Industry," Economic Papers, The Economic Society of Australia, vol. 23(1), pages 73-87, March.
    4. Glyn Wittwer, 2009. "The Economic Impacts of a New Dam in South‐East Queensland," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 42(1), pages 12-23, March.
    5. James A. Giesecke & John R. Madden, 2013. "Evidence-based regional economic policy analysis: the role of CGE modelling," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 6(2), pages 285-301.
    6. George Verikios & Xiao-guang Zhang, 2010. "Structural Change in the Australian Electricity Industry During the 1990s and the Effect on Household Income Distribution," Centre of Policy Studies/IMPACT Centre Working Papers g-207, Victoria University, Centre of Policy Studies/IMPACT Centre.
    7. George Verikios & Xiao-guang Zhang, 2016. "Structural change and income distribution: the case of Australian telecommunications," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(4), pages 549-570, October.
    8. Verikios, George & Zhang, Xiao-guang, 2013. "Structural change in the Australian electricity industry during the 1990s and the effect on household income distribution: A macro–micro approach," Economic Modelling, Elsevier, vol. 32(C), pages 564-575.
    9. James Giesecke & Peter B. Dixon & Maureen T. Rimmer, 2008. "Regional macroeconomic outcomes under alternative arrangements for the financing of public infrastructure," Papers in Regional Science, Wiley Blackwell, vol. 87(1), pages 3-31, March.
    10. Yalew, Amsalu W. & Hirte, Georg & Lotze-Campen, Hermann & Tscharaktschiew, Stefan, 2017. "General equilibrium effects of public adaptation in agriculture in LDCs: Evidence from Ethiopia," CEPIE Working Papers 11/17, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    11. Peter B. Dixon & Maureen T. Rimmer, 2004. "Disaggregation of results from a detailed general equilibrium model of the US to the State level," Centre of Policy Studies/IMPACT Centre Working Papers g-145, Victoria University, Centre of Policy Studies/IMPACT Centre.
    12. Wittwer, Glyn & McKirdy, Simon & Wilson, Ryan, 2005. "Regional economic impacts of a plant disease incursion using a general equilibrium approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(01), pages 1-15.
    13. Pham Van Ha & Hoa Thi Minh Nguyen & Tom Kompas & Tuong Nhu Che & Bui Trinh, 2015. "Rice Production, Trade and the Poor: Regional Effects of Rice Export Policy on Households in Vietnam," Journal of Agricultural Economics, Wiley Blackwell, vol. 66(2), pages 280-307, June.
    14. Elbehri, Aziz, 2004. "MFA Quota Removal and Global Textile and Cotton Trade: Estimating Quota Trade Restrictiveness and Quantifying Post-MFA Trade Patterns," Conference papers 331295, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    15. John Madden & Matthew Crowe, 1998. "Estimating the economic impact of the Sydney Olympic Games," ERSA conference papers ersa98p498, European Regional Science Association.
    16. H. Ahammad, 2000. "WAG: A computable general equilibrium model of the Western Australian economy," Economics Discussion / Working Papers 00-11, The University of Western Australia, Department of Economics.
    17. Glyn Wittwer, 2020. "Estimating the Regional Economic Impacts of the 2017 to 2019 Drought on NSW and the Rest of Australia," Centre of Policy Studies/IMPACT Centre Working Papers g-297, Victoria University, Centre of Policy Studies/IMPACT Centre.
    18. Peter Dixon & James Giesecke & Maurreen Rimmer, 2004. "Regional macroeconomic outcomes under alternative arrangements for the financing of urban infrastructure," ERSA conference papers ersa04p116, European Regional Science Association.
    19. Larry Dwyer & Peter Forsyth & Ray Spurr & Thiep Van Ho, 2006. "Economic Effects of the World Tourism Crisis on Australia," Tourism Economics, , vol. 12(2), pages 171-186, June.
    20. Mark Horridge & Glyn Wittwer, 2006. "The Impacts of Higher Energy Prices on Indonesia’s and West Java’s Economies using INDOTERM, a Multiregional Model of Indonesia," Working Papers in Economics and Development Studies (WoPEDS) 200607, Department of Economics, Padjadjaran University, revised Aug 2006.

    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:ags:pugtwp:331127. 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    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.