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The sophistication of exports: Is China special?

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  • Xu, Bin
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    Abstract

    Recent studies have found that China is "special" in exporting highly sophisticated goods not comparable with its income level. In this paper we identify two measurement biases that account for this "China is special" observation. First, product quality has not been fully considered in the measurement of sophistication, which has caused an overestimation of the sophistication of China's exports. Second, the average income of China has been used to measure the export capability of China, which has caused an underestimation of China's capability of exporting sophisticated goods. After correcting the two measurement biases, China appears much less as an outlier in the cross-country comparison of the sophistication of exports.

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    Bibliographic Info

    Article provided by Elsevier in its journal China Economic Review.

    Volume (Year): 21 (2010)
    Issue (Month): 3 (September)
    Pages: 482-493

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    Handle: RePEc:eee:chieco:v:21:y:2010:i:3:p:482-493

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    Web page: http://www.elsevier.com/locate/chieco

    Related research

    Keywords: China Export structure Product quality Sophistication;

    References

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    1. Peter K. Schott, 2006. "The Relative Sophistication of Chinese Exports," NBER Working Papers 12173, National Bureau of Economic Research, Inc.
    2. Zhi Wang & Shang-Jin Wei, 2010. "What Accounts for the Rising Sophistication of China's Exports?," NBER Chapters, in: China's Growing Role in World Trade, pages 63-104 National Bureau of Economic Research, Inc.
    3. Finger, J M & Kreinin, M E, 1979. "A Measure of 'Export Similarity' and Its Possible Uses," Economic Journal, Royal Economic Society, vol. 89(356), pages 905-12, December.
    4. Ari Van Assche & Byron Gangnes, 2007. "Electronics Production Upgrading: Is China Exceptional?," CIRANO Working Papers 2007s-16, CIRANO.
    5. Mary Amiti & Caroline Freund, 2010. "The Anatomy of China's Export Growth," NBER Chapters, in: China's Growing Role in World Trade, pages 35-56 National Bureau of Economic Research, Inc.
    6. XU, Bin & LU, Jiangyong, 2009. "Foreign direct investment, processing trade, and the sophistication of China's exports," China Economic Review, Elsevier, vol. 20(3), pages 425-439, September.
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    Cited by:
    1. Gabor Pula & Daniel Santabárbara, 2011. "Is China climbing up the quality ladder? Estimating cross country differences in product quality using Eurostat's COMEXT trade database," Working Paper Series 1310, European Central Bank.

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