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Did Chinese Outward Activity Attenuate or Aggravate the Great Recession in Developing Countries?

Author

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  • Bastian Gawellek
  • Jingjing Lyu
  • Bernd Süssmuth

Abstract

Using data on Chinese large-scale overseas investment and project contracts by sector, we analyze whether Chinese outward activity (COA) before the crisis worsened or alleviated the contractionary phases in developing countries. We find that, on average, COA did not increase vulnerability to the global recession. However, both the sectoral targeting and the size of the pre-crisis engagement matter: While COA in clearly to financial markets tied sectors implied an aggravation, substantial precrisis investment in the energy, metals and transportation industries implied an attenuation of the slump.

Suggested Citation

  • Bastian Gawellek & Jingjing Lyu & Bernd Süssmuth, 2016. "Did Chinese Outward Activity Attenuate or Aggravate the Great Recession in Developing Countries?," CESifo Working Paper Series 5735, CESifo.
  • Handle: RePEc:ces:ceswps:_5735
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    More about this item

    Keywords

    global crisis; offshoring; developing countries; sectoral transmission;
    All these keywords.

    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F30 - International Economics - - International Finance - - - General
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development

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