Will the financial crisis become the turning point for China's auto industry? A dynamic computable general equilibrium analysis with imperfect competition
AbstractFollowing the substantial damage from the financial crisis in 2008, can China's auto industry successfully take up new challenges and grasp the opportunities ahead? First and foremost, this paper summarises the ways that the financial crisis has impacted upon China's economy. By analysing the impacts based on the MCHUGE model, the paper concludes that reductions in export demand and consumption expectations have limited impact on China's auto industry, while the comparative reduction in investment expectations has a great impact on China's auto industry. The paper builds the MCHUGE model with imperfect competition in order to assess whether China's auto industry, characterised as an oligopoly, could successfully accept such a challenge. The conclusion of this paper indicates that the damage to China's auto industry caused by the financial crisis would appear even more serious if the static effect of an oligopoly was the only consideration. Finally, by simulating the implementation of the Revitalisation Plans of the Automobile Industry, it is concluded that the revitalisation policy aims to boost auto consumption and will thus bring new opportunities for China's auto industry; on the other hand, the mergers and acquisitions between and among auto industries, as well as the relevant potential technology progress and the popularisation of new energy automobiles, will further promote the development of China's auto industry.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Journal of Chinese Economic and Business Studies.
Volume (Year): 7 (2009)
Issue (Month): 4 ()
Contact details of provider:
Web page: http://www.tandfonline.com/RCEA20
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.