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Trade Flows and Trade Specialisation: The Case of China

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  • Guglielmo Maria Caporale
  • Anamaria Sova
  • Robert Sova

Abstract

Using annual data for the period 1992-2012, this paper examines trade flows between China and its main trade partners in Asia, North America and Europe, and whether increasing trade has led to industrial structural adjustment and changes in China’s trade patterns. The analysis is based on both economic indicators and the estimation of a gravity model, and applies recently developed panel data methods that explicitly take into account unobserved heterogeneity, specifically the fixed effect vector decomposition (FEVD) technique. The findings confirm the significant change in China’s trading structure associated with the fast growth of foreign trade. In particular, there has been a shift from resource- and labour-intensive to capital- and technology-intensive exports.

Suggested Citation

  • Guglielmo Maria Caporale & Anamaria Sova & Robert Sova, 2015. "Trade Flows and Trade Specialisation: The Case of China," CESifo Working Paper Series 5217, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_5217
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    References listed on IDEAS

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    Cited by:

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    2. Abeliansky, Ana Lucia & Martínez-Zarzoso, Inmaculada, 2019. "The relationship between the Chinese "going out" strategy and international trade," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 13, pages 1-17.
    3. Laurent Didier, 2017. "South-South Trade and Geographical Diversification of Intra-SSA Trade: Evidence from BRICs," African Development Review, African Development Bank, vol. 29(2), pages 139-154, June.
    4. repec:bde:journl:y:2019:i:6:d:aa:n:14 is not listed on IDEAS
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    7. D. Baiardi & C. Bianchi, 2018. "At the roots of China's striking performance in textile exports: a comparison with its main Asian competitors," Economics Department Working Papers 2018-EP03, Department of Economics, Parma University (Italy).
    8. repec:ura:ecregj:v:1:y:2018:i:4:p:1450-1462 is not listed on IDEAS
    9. Shahriar, Saleh & Qian, Lu & Kea, Sokvibol, 2018. "China's economic integration with the Greater Mekong Sub-region: An empirical analysis by a panel dynamic gravity model," Economics Discussion Papers 2018-44, Kiel Institute for the World Economy (IfW).
    10. Keddad, Benjamin, 2019. "How do the Renminbi and other East Asian currencies co-move?," Journal of International Money and Finance, Elsevier, vol. 91(C), pages 49-70.
    11. repec:eee:ecmode:v:74:y:2018:i:c:p:194-206 is not listed on IDEAS
    12. Inga Ivanova & Oivind Strand & Duncan Kushnir & Loet Leydesdorff, 2015. "The Efficiency of Triple-Helix Relations in Innovation Systems: Measuring the Connection between a Country’S Net Income and its Knowledge Base," HSE Working papers WP BRP 55/STI/2015, National Research University Higher School of Economics.
    13. repec:pid:journl:v:56:y:2017:i:1:p:59-78 is not listed on IDEAS
    14. Putu Mahardika Adi Saputra, 2019. "Dynamic Perspective of Trade Balance: Evidence from Southeast Asia before the Global Financial Crisis of 2008," GATR Journals jber170, Global Academy of Training and Research (GATR) Enterprise.
    15. Timini, Jacopo & Conesa, Marina, 2019. "Chinese Exports and Non-Tariff Measures: Testing for Heterogeneous Effects at the Product Level," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 34(2), pages 327-345.

    More about this item

    Keywords

    gravity model; panel data analysis; trade specialisation; comparative advantage;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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