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Export sophistication and economic growth: evidence from China

Author

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  • Joachim Jarreau

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CRPMS (EA_3522) - Centre de Recherches Psychanalyse, Médecine et Société - UPD7 - Université Paris Diderot - Paris 7)

  • Sandra Poncet

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique)

Abstract

We consider the effect of export sophistication on economic performance using regional variations within a single country (China) over the period 1997-2009. We confirm Hausmann, Hwang and Rodrik (2007)'s prediction that regions that specialize in more sophisticated goods subsequently grow faster. We find that at the province and prefecture level, there is substantial variation in export sophistication controlling for the level of development, and that this difference in turn matters for growth. Our results suggest that these gains are limited to ordinary export activities undertaken by domestic firms. No direct gains appear to derive from processing trade activities and from foreign firms even though they are the main contributors to the global upgrading of China's exports. This finding suggests that the contribution of assembly trade and foreign entities must be distinguished when one wants to measure the true improvement in the country's technology level and its contribution to economic growth.

Suggested Citation

  • Joachim Jarreau & Sandra Poncet, 2011. "Export sophistication and economic growth: evidence from China," PSE - G-MOND WORKING PAPERS halshs-00962593, HAL.
    • Handle: RePEc:hal:gmonwp:halshs-00962593
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00962593
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    More about this item

    Keywords

    Export sophistication; Economic growth; Processing trade; China;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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