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Containing Chinese state-owned enterprises? The role of deep trade agreements

Author

Listed:
  • Kevin Lefebvre

    (CEPII)

  • Nadia Rocha

    (World Bank)

  • Michele Ruta

    (World Bank)

Abstract

Regional trade agreements increasingly include provisions that regulate state-owned enterprises. This paper combines new information on the content of “deep” regional trade agreements and data on Chinese firm-level exports during 2000–2011 to analyze the spillover effect of rules on state-owned enterprises on the intensive and extensive margins of Chinese state-owned enterprises’ trade. Rather than containing state capitalism, regional trade agreements regulating state-owned enterprises signed by Chinese trading partners with third countries increase exports and entry of Chinese state-owned enterprises as they gain a competitive edge in regulated markets. This spillover effect is robust to several extensions and is even stronger for agreements that include rules on subsidies and competition policy. This finding points to the need for commonly agreed multilateral rules to regulate state owned enterprises.

Suggested Citation

  • Kevin Lefebvre & Nadia Rocha & Michele Ruta, 2023. "Containing Chinese state-owned enterprises? The role of deep trade agreements," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 159(4), pages 887-920, November.
    • Handle: RePEc:spr:weltar:v:159:y:2023:i:4:d:10.1007_s10290-022-00484-z
    DOI: 10.1007/s10290-022-00484-z
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    More about this item

    Keywords

    State-owned enterprises; Regional trade agreements; China;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F1 - International Economics - - Trade
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid

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