China's Imports Slowdown: Spillovers, Spillins, and Spillbacks

46 Pages Posted: 6 Apr 2016

See all articles by Alexei Kireyev

Alexei Kireyev

International Monetary Fund (IMF)

Andrei Leonidov

Independent

Date Written: March 2016

Abstract

The paper models international spillovers from a hypothetical drop of China's imports as a result of China's rebalancing of its growth model. A network-based model used in the paper allows capturing higher round network effects of the shock, which are largely unaccounted for in the existing literature. Such effects include direct spillovers from China on its trading partners, subsequent spillins among them, and spillbacks on China itself. The paper finds that the network effects most likely will be substantial, may amplify initial shock, and change the direction of its propagation. The impact on Asia and Pacific will be the strongest followed by the Middle East and Central Asia. The impact on sub-Saharan Africa would be noticeable only for some countries. Spillovers on Europe, including the Euro area, will be moderate, and spillovers on the Western Hemisphere, including the United States, would be very marginal. Metal and non-fuel commodity exporters may experience the largest negative impact.

Keywords: shocks, spillover, spillin, spillback, network, gdp, revenue, demand, Neural Networks and Related Topics, Country and Industry Studies of Trade, Open Economy Macroeconomics, International Policy Coordination and Transmission, Forecasting and Simulation, and spillback, network.,

JEL Classification: C45, F14, F41, F42, F47

Suggested Citation

Kireyev, Alexei and Leonidov, Andrei, China's Imports Slowdown: Spillovers, Spillins, and Spillbacks (March 2016). IMF Working Paper No. 16/51, Available at SSRN: https://ssrn.com/abstract=2759760

Alexei Kireyev (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Andrei Leonidov

Independent ( email )

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