Decomposing China's Export Growth into Extensive Margin, Export Quality and Quantity Effects

34 Pages Posted: 6 Jun 2013  

Yue Gao

Shandong University of Technology - School of Business

John Whalley

University of Western Ontario - Department of Economics; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute); Centre for International Governance and Innovation (CIGI)

Yonglei Ren

Shandong University of Technology

Date Written: May 31, 2013

Abstract

This paper decomposes the growth of China’s export into three parts: growth in the extensive margin, increased quantity and increased prices; we perform a series of empirical analyses using China’s export data at HS-6 digit to analyze the characteristics of China’s export growth. From 1995 to 2010, China’s export growth was mainly driven by quantity growth with a contribution of 66.81%; but if we divide the time period from 1995 to 2010 into five even phases, we find the three parts of export growth show different trends. The contributions of the extensive margin and price changes are decreasing, but quantity shows an increasing trend. China’s export is better than the rest of the world after the financial crisis and in 2008-2010, with a strategy of lowering price and promoting sales in 2009 when facing a slump in export markets; resuming price increases and increasing sales moderately in reaction to improving export conditions in 2010.

Keywords: product fragmentation, heterogeneity, export, FDI

JEL Classification: F140

Suggested Citation

Gao, Yue and Whalley, John and Ren, Yonglei, Decomposing China's Export Growth into Extensive Margin, Export Quality and Quantity Effects (May 31, 2013). CESifo Working Paper Series No. 4251. Available at SSRN: https://ssrn.com/abstract=2274616

Yue Gao

Shandong University of Technology - School of Business ( email )

No.88 Gongqingtuan Road
Zibo, Shandong province 255012
China

John Whalley (Contact Author)

University of Western Ontario - Department of Economics ( email )

London, Ontario N6A 5B8
Canada
519-661-3509, ext. 83509 (Phone)
519-661-3666 (Fax)

HOME PAGE: http://www.ssc.uwo.ca/economics/faculty/

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
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CESifo (Center for Economic Studies and Ifo Institute)

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Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Centre for International Governance and Innovation (CIGI) ( email )

57 Erb Street West
Waterloo, Ontario N2L 6C2
Canada

Yonglei Ren

Shandong University of Technology ( email )

No. 88 Gongqingtuan Road
Zibo, Shandong Province 255012
China

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