How Much Did China's WTO Accession Increase Economic Growth in Resource-Rich Countries?

Discussion papers on Business and Economics, University of Southern Denmark, 15/2013

27 Pages Posted: 11 Oct 2013

See all articles by Thomas Barnebeck Andersen

Thomas Barnebeck Andersen

University of Southern Denmark - Department of Business and Economics

Mikkel Barslund

Centre for European Policy Studies (CEPS)

Casper Worm Hansen

University of Copenhagen - Department of Economics; University of Copenhagen

Thomas Harr

University of Copenhagen - Department of Economics

Peter S. Jensen

University of Southern Denmark - Department of Business and Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 4, 2013

Abstract

We provide an estimate of China’s impact on the growth rate of resource-rich countries after its WTO accession on 11 December 2001. Our empirical approach follows the logic of the differences-in-differences estimator. In addition to temporal variation arising from the WTO accession, which we argue was exogenous to other countries’ growth trajectories, we exploit spatial variation arising from differences in natural resource wealth. This allows us to compare changes in economic growth in the post-accession period relative to the pre-accession period between countries that were able to benefit from the surge in demand for industrial commodities brought about by China’s WTO accession and countries that were less able to do so. We find that roughly one tenth of average annual post-accession growth in resource-rich countries was due to China’s increased appetite for commodities. We use this finding to inform the debate about what will happen to economic growth in resource-rich countries as China rebalances and its demand for commodities weakens.

Keywords: Economic growth, natural resources, WTO, China

JEL Classification: F4, F62

Suggested Citation

Andersen, Thomas Barnebeck and Barslund, Mikkel and Hansen, Casper Worm and Harr, Thomas and Jensen, Peter S., How Much Did China's WTO Accession Increase Economic Growth in Resource-Rich Countries? (October 4, 2013). Discussion papers on Business and Economics, University of Southern Denmark, 15/2013, Available at SSRN: https://ssrn.com/abstract=2335903 or http://dx.doi.org/10.2139/ssrn.2335903

Thomas Barnebeck Andersen (Contact Author)

University of Southern Denmark - Department of Business and Economics ( email )

Campusvej 55
DK-5230 Odense, 5000
Denmark

Mikkel Barslund

Centre for European Policy Studies (CEPS) ( email )

1 Place du Congres, 1000
Brussels, 1000
Belgium

Casper Worm Hansen

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
Copenhagen K, DK 1153
Denmark

University of Copenhagen ( email )

Nørregade 10
Copenhagen, København DK-1165
Denmark

Thomas Harr

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
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1353 Copenhagen K.
Denmark
(+) 45 35323258 (Phone)
(+) 45 35323000 (Fax)

Peter S. Jensen

University of Southern Denmark - Department of Business and Economics ( email )

Campusvej 55
DK-5230 Odense M, 5230
Denmark

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