The Influence of Chinese Trade Policy on Automobile Assembly and Parts
This paper analyzes the economic effects of content-based import tariffs China imposed on imported auto parts. While China’s policy penalized any firm that assembled cars with less than 60 percent Chinese content, the policy was most likely to affect foreign affiliated firms who were more likely to exceed the content ceiling. To assess whether foreign-affiliated firms differentially changed their input sourcing this paper uses Chinese product trade data for 1997 to 2009 which report trade transactions by firm ownership type. Compared with import transactions for other firms, the data show that foreign-affiliated firms appear to have mitigated the effects of the policy by reducing import transaction prices, and by reducing their import quantities on the extensive margin. While China’s content-based auto import trade policy was repealed in 2009 after China lost its dispute case at the WTO, the extraordinary growth in China’s global export of auto parts since 2005 suggests that China’s short term trade policy may have contributed to enduring effects in global supply chains.
|Date of creation:||2011|
|Date of revision:|
|Contact details of provider:|| Postal: Poschingerstrasse 5, 81679 Munich|
Phone: +49 (89) 9224-0
Fax: +49 (89) 985369
Web page: http://www.cesifo-group.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert C. Feenstra & Gordon H. Hanson, 2004.
"Ownership and Control in Outsourcing to China: Estimating the Property-Rights Theory of the Firm,"
NBER Working Papers
10198, National Bureau of Economic Research, Inc.
- Robert C. Feenstra & Gordon H. Hanson, 2005. "Ownership and Control in Outsourcing to China: Estimating the Property-Rights Theory of the Firm," The Quarterly Journal of Economics, Oxford University Press, vol. 120(2), pages 729-761.
- Taiju Kitano & Hiroshi Ohashi, 2009.
"Did US Safeguards Resuscitate Harley-Davidson in the 1980s?,"
CIRJE-F-612, CIRJE, Faculty of Economics, University of Tokyo.
- Kitano, Taiju & Ohashi, Hiroshi, 2009. "Did US safeguards resuscitate Harley-Davidson in the 1980s?," Journal of International Economics, Elsevier, vol. 79(2), pages 186-197, November.
- KITANO Taiju & OHASHI Hiroshi, 2007. "Did U.S. Safeguard Resuscitate Harley Davidson in the 1980s?," Discussion papers 07026, Research Institute of Economy, Trade and Industry (RIETI).
- Weinert, Jonathan & Ogden, Joan & Sperling, Dan & Burke, Andrew, 2008. "The future of electric two-wheelers and electric vehicles in China," Energy Policy, Elsevier, vol. 36(7), pages 2544-2555, July.
- Fisman, Raymond & Moustakerski, Peter & Wei, Shang-Jin, 2007.
"Outsourcing Tariff Evasion: A New Explanation for Entrepôt Trade,"
CEPR Discussion Papers
6078, C.E.P.R. Discussion Papers.
- Raymond Fisman & Peter Moustakerski & Shang-Jin Wei, 2008. "Outsourcing Tariff Evasion: A New Explanation for Entrepôt Trade," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 587-592, August.
- Raymond Fisman & Peter Moustakerski & Shang-Jin Wei, 2007. "Outsourcing Tariff Evasion: A New Explanation for Entrepot Trade," NBER Working Papers 12818, National Bureau of Economic Research, Inc.
- Bruce A. Blonigen, 1999.
"In Search of Substitution Between Foreign Production and Exports,"
NBER Working Papers
7154, National Bureau of Economic Research, Inc.
- Blonigen, Bruce A., 2001. "In search of substitution between foreign production and exports," Journal of International Economics, Elsevier, vol. 53(1), pages 81-104, February.
- Robert C. Feenstra, 1997. "Introduction to "The Effects of U.S. Trade Protection and Promotion Policies"," NBER Chapters, in: The Effects of U.S. Trade Protection and Promotion Policies, pages 1-7 National Bureau of Economic Research, Inc.
- Lopez-de-Silanes, Florencio & Markusen, James R. & Rutherford, Thomas F., 1996. "Trade policy subtleties with multinational firms," European Economic Review, Elsevier, vol. 40(8), pages 1605-1627, November.
When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_3615. See general 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: (Klaus Wohlrabe)
If references are entirely missing, you can add them using this form.