The China Syndrome 2.0: A Misdiagnosis ?

Alessandro Barattieri and Aaditya Mattoo

No 11470, Policy Research Working Paper Series from The World Bank

Abstract: China's growing dominance in manufacturing exports has given rise to concerns about a new "China Syndrome," this time focused on its impact on developing rather than industrial countries. However, emerging explanations of China's export exceptionalism and its consequences suffer from three shortcomings. First, attributing China’s large and increasing share in manufacturing exports primarily to its industrial policy obscures more fundamental factors: the scale of its economy, the diversity of its provincial endowments, and the pace of its automation. Second, focusing on the low-skilled export dimension of China’s economic expansion overlooks its positive impact on growth and its heterogeneous effects on structural transformation in developing countries. Finally, blaming foreign industrial policies distracts attention from the often more damaging trade and investment restrictions imposed by developing countries themselves, many of which could be reformed unilaterally. This misdiagnosis matters because the already narrow window for labor intensive industrialization in many developing countries may shrink further if the cost of automation falls faster than wages in China rise.

Date: 2026-09-29
New Economics Papers: this item is included in nep-sea
References: Add references at CitEc
Citations:

Downloads: (external link)
https://documents.worldbank.org/curated/en/0992161 ... a5a-155fea939554.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (https://documents.worldbank.org/curated/en/099216109292695725/pdf/IDU-f1315037-00b7-432b-aa5a-155fea939554.pdf [302 Found]--> http://documents1.worldbank.org/curated/en/099216109292695725/pdf/IDU-f1315037-00b7-432b-aa5a-155fea939554.pdf [301 Moved Permanently]--> https://documents1.worldbank.org/curated/en/099216109292695725/pdf/IDU-f1315037-00b7-432b-aa5a-155fea939554.pdf)

Related works:
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:wbk:wbrwps:11470

Access Statistics for this paper

More papers in Policy Research Working Paper Series from The World Bank 1818 H Street, N.W., Washington, DC 20433. Contact information at EDIRC.
Bibliographic data for series maintained by Roula I. Yazigi ().