Accounting for the evolution of China's production and trade patterns

Hanwei Huang, Jiandong Ju and Vivian Z. Yue

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper studies the evolution of China's production and trade patterns during its integration into the global economy. We document and explain new facts concerning changes in production and exports at the industry and firm levels using microdata and a quantitative Ricardian and Heckscher-Ohlin model with heterogeneous firms. Counterfactual simulations reveal that capital deepening made China's production and exports more capital-intensive, although labor-biased productivity growth acted as a counterforce. Consistent with the data, our model demonstrates that China's trade openness peaked around the mid-2000s and fell until the 2020s, while the world's exposure to Chinese exports rose continuously.

Keywords: production and trade patterns; comparative advantage; heterogeneous firm; trade liberalization; capital deepening; productivity growth; trade openness; China shock (search for similar items in EconPapers)
JEL-codes: D24 E23 E25 F12 F14 L16 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2024-05-01
References: Add references at CitEc
Citations:

Downloads: (external link)
http://eprints.lse.ac.uk/126809/ Open access version. (application/pdf)

Related works:
Working Paper: Accounting for the evolution of China's production and trade patterns (2024)
Working Paper: Accounting for the Evolution of China’s Production and Trade Patterns (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:126809

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().