 Trading textiles along the new silk route: The impact on Pakistani firms of gaining market access to ChinaNida Jamil, Theresa Chaudhry and Azam Chaudhry Journal of Development Economics, 2022, vol. 158, issue C Abstract: In this study, we analyze the impact of the lower Chinese tariffs on Pakistani textile manufacturers that resulted from the Pakistan-China Free Trade Agreement (FTA). As a result of lower Chinese tariffs, Pakistani textile manufacturers increased exports though the number of firms exporting to China changed marginally and only in the spinning sector did exports substantially rise. Using a variety of recently developed methodologies, our results indicate that the productivity of textile manufacturers rose 3-8 percent and product quality rose 1-2 percent. Firms reduced product offerings in response to tariff drops. In contrast to a number of previous studies where exporting was accompanied by investment or R&D, exporters to China increased material and labor inputs but not capital. Non-exporters' productivity and quality also rose, indicating the presence of spillovers. Testing this, we find that these spillovers occurred for non-exporters downstream from higher productivity exporters in close geographic proximity. Keywords: Trade liberalization; Export tariffs; Free trade agreements; Productivity; Production function estimation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:158:y:2022:i:c:s0304387822000888 DOI: 10.1016/j.jdeveco.2022.102935 Access Statistics for this article Journal of Development Economics is currently edited by M. R. Rosenzweig More articles in Journal of Development Economics from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.