How Does Trade Liberalization in Imports Affect China's Export Growth Pattern?

Huizheng Liu (), Yin Xiao () and Shilong Li ()
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Huizheng Liu: College of Economics and Management Beijing University of Technology Beijing, China
Yin Xiao: College of Economics and Management Beijing University of Technology Beijing, China
Shilong Li: Academy of China Council for the Promotion of International Trade Beijing, China

Asian Economic Papers, 2024, vol. 23, issue 2, 174-198

Abstract: Optimizing export growth patterns and improving the quality of export trade have become prominent issues that need to be addressed urgently in the context of increasing global economic uncertainty. This study utilizes matched data from the CEPII database (1995–2020) and WTO tariff database, adopts a product-level perspective based on the triple margins of exports, and uses an individual-time two-way fixed-effects model to investigate the impact of import trade liberalization on China's export growth pattern. The research findings are as follows: (1) Increasing levels of import trade liberalization are beneficial for enhancing the extensive margin, intensive margin, and quantity margin of products, while exerting a restraining effect on the price margin. This strengthens the price advantage of Chinese products, indicating that import trade liberalization helps optimize China's export growth pattern. (2) Compared with the intensive margin, import trade liberalization has a more significant promoting effect on the extensive margin. (3) The conclusions drawn from heterogeneity analysis suggest that trade liberalization has a more pronounced effect on the extensive margin, intensive margin, and quantity margin of products in medium-high technology industries, differentiated products, and intermediate goods. This study holds important theoretical and practical significance for evaluating the economic benefits of expanding imports, optimizing China's export growth pattern, and improving the quality of export trade.

Date: 2024
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