Short- and long-term impact of remarkable economic events on the growth causes of China–Germany trade in agri-food products

Zhichao Guo (), Yuanhua Feng and Xiangyong Tan

Economic Modelling, 2011, vol. 28, issue 6, 2359-2368

Abstract: This paper focuses on a systematic quantitative discussion of the short- and long-term impact of remarkable economic events on international trade in a two-stage framework. Firstly, procedures based on dummy variables are proposed to detect structural breaks, types and sizes of jumps caused by such events. Then we propose to apply a hierarchical CMS (Constant Market Share) model to all sub-periods determined by the detected change points to study the short- and long-term impact of those events on growth causes. Application to China–Germany trade in agri-food products shows that China's accession to WTO had a negative short-term impact on corresponding series. But its long-term impact on China's export competitiveness was clearly positive. The short-term impact of the EU's CAP (Common Agricultural Policy) reform on Germany's exports to China was also negative. Its long-term impact on export competitiveness was sometimes positive and sometimes negative. The financial crisis of 2008 caused a significant reduction of China's agri-food exports to Germany. But Germany's exports to China in 2009 were not affected by the financial crisis as much.

Keywords: Growth causes of agri-food trade; The CMS model; The EU's CAP reform; China's accession to WTO; Financial crisis (search for similar items in EconPapers)
JEL-codes: C53 Q17 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Working Paper: Short- and long-term impact of remarkable economic events on the growth causes of China-Germany trade in agri-food products (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:28:y:2011:i:6:p:2359-2368

DOI: 10.1016/j.econmod.2011.06.007

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