Effects of China and India on Manufactured Exports of the G7 Economies
Contemporary Economic Policy, 33 (2): 265–278, April 2015
27 Pages Posted: 20 May 2014 Last revised: 10 Feb 2015
Date Written: May 18, 2014
This paper analyses the effects of China and India on manufactured exports of the G7 economies. The following three findings stand out. First, the rivalry effect of China is robustly significant in all investigated markets, including the world and the G7 countries collectively and individually, while the rivalry effect of India is significant in the French, Italian, Japanese and world markets but insignificant in other markets. Second, the rivalry effect of China in the world market is substantial in 13 of 22 manufacturing industries, and most pronounced for Textiles, Telecom equipment, Fabricated metal products, Computing machinery, and Furniture, while this effect of India is significant only in one industry (Basic metals). Third, Germany is the only G7 economy that appears not to be affected by China’s rivalry effect. Germany has also been more successful than other G7 economies in penetrating the Chinese market.
JEL Classification: O4, F1
Suggested Citation: Suggested Citation