 Promotion Effect of CNY Appreciation on Export QualityMiaojie Yu ()
Chapter Chapter 7 in Exchange Rate, Credit Constraints and China’s International Trade, 2021, pp 195-228 from Springer Abstract: Abstract How does the CNY appreciation impact Chinese exporters? In this chapter, we study the impact of exchange rate change on enterprises’ export quality decision. Using micro-level data of Chinese manufacturers and customs from 2000 to 2006, we estimate export quality more accurately by correcting approaches applied in previous literature. Based on the estimated export quality, we find that the appreciation of CNY intensifies the competition faced by Chinese exporters and therefore promotes their export quality upgrading behaviors. On average, 10% of CNY appreciation leads to an increase in export product quality by 0.19%. For industries with high quality differentiation, the effect of 10% CNY appreciation on export product quality increase is 0.4%, while for industries with low quality differentiation, this effect is insignificant. In addition, appreciation of CNY reduces the number of exporters. We also find that quality upgrading effect is more significant for non-core products and less-productive exporters. We find a new mechanism through which exchange rate change affects export decisions, and show that competition is an important driving force for product quality upgrading. Date: 2021 There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-981-15-7522-8_7 Ordering information: This item can be ordered from DOI: 10.1007/978-981-15-7522-8_7 Access Statistics for this chapter More chapters in Springer Books from Springer |
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