An Anatomy of China's Export Boom: An Approach of Trade Margins#. Issue 2 (27th October 2020)

• Record Type: Journal Article
• Authors: Liu, Hui-Zheng; Li, Shi-Long; Zhang, Kevin H.
• Is Part Of: Chinese economy. Volume 54:Issue 2(2021)
• Page Start: 79
• Page End: 91
• Publication Date: 2020-10-27
• Subjects: Export penetration (EP) -- extensive margin (EM) -- intensive margin (IM) -- price margin (PM) -- quantity margin (QM) -- export upgrading; F14 -- O14; China -- Economic conditions -- Periodicals; Chine -- Conditions économiques -- Périodiques; 330.951
• DOI: 10.1080/10971475.2020.1830229
• Languages: English
• ISSNs: 1097-1475

Abstract

Abstract: Using export data with 6-digit HS categories for 1995-2018, we decompose China's export growth into three margins: extensive (EM), price (PM), and quantity (QM). Our estimations suggest that over the 23-year period, QM is a main driving force of China's export boom, accounting for 62% of total contributions, while PM and EM also make significant contributes (26% and 12%, respectively). Dynamic analyses based on four sub-periods suggest informative patterns of export upgrading due to external and internal shocks. In 1995-2001, PM and EM are overwhelming drivers, and QM is even negative. The trade liberalization as China's entering World Trade Organization in 2001 seems to trigger a dominant role of QM in China's explosive export growth in 2001-2013, with slight negative PM in the same two sub-periods. The contribution of EM is negligible in 2001-2008, and negative in 2008-2013 due to falling world demand as a result of the global financial crisis. In more recent years (2013-2018), China's export growth depends more on PM (39% of contributions) and EM (33%), less on QM (28%), suggesting a significant export upgrading.