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Export sophistication and economic growth: Evidence from China

Listed author(s):
  • Joachim Jarreau

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Sandra Poncet

    ()

    (PSE - Paris School of Economics, CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

We consider the effect of export sophistication on economic performance by appealing to regional variation within one single country (China) over the 1997-2009 period. We find evidence in support of Hausmann, Hwang and Rodrik (2007), in that regions specializing in more sophisticated goods subsequently grow faster. We find substantial variation in export sophistication at the province and prefecture level, controlling for the level of development, and that this sophistication in turn drives growth. Our results suggest that these gains are limited to the ordinary export activities undertaken by domestic firms: no direct gains result from either processing trade activities or foreign firms, even though these are the main contributors to the global upgrading of China's exports. As such, the extent of assembly trade and foreign entities should be distinguished in order to measure the true movement in a country's technology and the contribution of exports to economic growth.

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Paper provided by HAL in its series PSE - Labex "OSE-Ouvrir la Science Economique" with number hal-00649282.

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Date of creation: Mar 2012
Publication status: Published in Journal of Development Economics, Elsevier, 2012, 97 (2), pp.281-292. <10.1016/j.jdeveco.2011.04.001>
Handle: RePEc:hal:pseose:hal-00649282
DOI: 10.1016/j.jdeveco.2011.04.001
Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00649282
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