On the Relevance of Exports for Regional Output Growth in China

Christian Dreger and Yanqun Zhang

No 1264, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: Despite high economic growth during the last decades, China is still vulnerable to shocks arising from industrial states. The advanced economies determine Chinese export performance, with subsequent effects on output growth. Using a production function approach, this paper examines to which extent regional GDP growth in China is export driven. In a panel of 28 Chinese provinces, series are splitted into common and idiosyncratic components, the latter being stationary. The results indicate cointegration between the common components of GDP, the capital stock and exports. In equilibrium, exports increase GDP by more than their impact expected from the national accounts. While exports and capital are weakly exogenous, GDP responds to deviations from the long run. An adjustment pattern can be detected for almost all regions, except of some provinces in the Western part of the country.

Keywords: Chinese economy; panel co-integration; expert led growth (search for similar items in EconPapers)
JEL-codes: C23 F43 O11 (search for similar items in EconPapers)
Pages: 20 p.
Date: 2013
New Economics Papers: this item is included in nep-fdg and nep-tra
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Related works:
Journal Article: On the relevance of exports for regional output growth in China (2014)
Working Paper: On the relevance of exports for regional output growth in China (2013)
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