Impacts of the World Trade Organization on Chinese Exports

Author Name WAKASUGI Ryuhei (Faculty Fellow, RIETI) / ZHANG Hongyong (Fellow, RIETI)
Creation Date/NO. February 2015 15-E-021
Research Project Global Markets and Japan's Industrial Growth
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Chinese exports dramatically increased in the early 2000s as China reformed its economy to become more free and open via its entry into the World Trade Organization (WTO), which clearly affected the productivity and exports of Chinese firms. This paper, using firm-level panel data from the Chinese electric machinery, electronics equipment, and telecommunications equipment industries, confirms that after the entry into the WTO, the export decision of Chinese firms was accelerated by a rise in productivity that was not uniform among the ownership structures. By disaggregating the firms into three groups—private domestic firms (PDFs), state-owned enterprises (SOEs), and foreign invested enterprises (FIEs)—our empirical estimation reveals that the economic reform via the entry into the WTO had a "productivity effect" on Chinese exports which commonly enhanced firms' exports according to their productivity levels, but had an asymmetric "ownership effect" on their exports among the three groups, which was less favorable for exports of SOEs in comparison with that of FIEs and PDFs.

Published: Wakasugi, Ryuhei, and Hongyong Zhang, 2016. "Impacts of the World Trade Organization on Chinese exports," Journal of Chinese Economic and Business Studies, Vol. 14(4), pp. 347-364