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Exports, Technical Progress and Productivity Growth in Chinese Manufacturing Industries

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  • Xiaolan Fu

Abstract

Theories suggesting either static or dynamic productivity gains derived from exports often assume the prior existence of a perfect market. In the presence of market failure, however, the competition effect and the resource reallocation effect of exports on productive efficiency may be greatly reduced; and there may actually be disincentives for innovation. This paper analyses the impact of exports on total factor productivity (TFP) growth in a transition economy using a panel of Chinese manufacturing industries over the period 1990-1997. TFP growth is estimated by employing a non-parametric approach and is decomposed into technical progress and efficiency change. We have not found evidence suggesting significant productivity gains at the industry level resulting from exports. Findings of the current study suggest that, for exports to generate significant positive effect on TFP growth, a well?developed domestic market and a neutral, outward-oriented policy are necessary.

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Bibliographic Info

Paper provided by ESRC Centre for Business Research in its series ESRC Centre for Business Research - Working Papers with number wp278.

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Date of creation: Apr 2004
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Handle: RePEc:cbr:cbrwps:wp278

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Keywords: exports; industrial efficiency; technical progress; productivity;

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Cited by:
  1. Dong He & Wenlang Zhang, 2008. "How Dependent is the Chinese Economy on Exports and in What Sense has its Growth been Export-led?," Working Papers 0814, Hong Kong Monetary Authority.

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