China's Trade Flows: Changing Price Sensitivies and the Reform Process

Anuradha Dayal-Gulati and Valerie Cerra

No 1999/001, IMF Working Papers from International Monetary Fund

Abstract: Over the past 20 years, the Chinese authorities have undertaken wide-ranging reforms of their exchange and trade systems that have steadily reduced the role of planning and increased the importance of market forces. As these reforms have taken root, relative prices and domestic and foreign demand would be expected to have played a bigger role in determining trade flows. Econometric estimates of export and import equations provide evidence that trade flows have indeed become increasingly price sensitive, owing to the gradual liberalization of the trade regime over time, and to the growing shares of foreign-funded enterprises and manufactures in total trade.

Keywords: WP; foreign trade; import plan; Trade reform; China; Exports; Imports; Price elasticity; Econometric models; import demand and supply equation; import volume; nonmandatory import; world imports; import behavior; import equation; import supply; import ban; export volume growth; form export equation; export transaction; Real effective exchange rates; Foreign direct investment; Asia and Pacific (search for similar items in EconPapers)
Pages: 37
Date: 1999-01-01
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Citations: View citations in EconPapers (30)

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