Did Chinese Outward Activity Attenuate or Aggravate the Great Recession in Developing Countries?

37 Pages Posted: 8 Mar 2016

See all articles by Bastian Gawellek

Bastian Gawellek

University of Leipzig

Jingjing Lyu

University of Leipzig - Institute for Empirical Research in Economics (IEW) / Econometrics

Bernd Süssmuth

University of Leipzig; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: February 3, 2016

Abstract

Using data on Chinese large-scale overseas investment and project contracts by sector, we analyze whether Chinese outward activity (COA) before the crisis worsened or alleviated the contractionary phases in developing countries. We find that, on average, COA did not increase vulnerability to the global recession. However, both the sectoral targeting and the size of the pre-crisis engagement matter: While COA in clearly to financial markets tied sectors implied an aggravation, substantial precrisis investment in the energy, metals and transportation industries implied an attenuation of the slump.

Keywords: global crisis, offshoring, developing countries, sectoral transmission

JEL Classification: F200, F300, F400, F630

Suggested Citation

Gawellek, Bastian and Lyu, Jingjing and Süssmuth, Bernd, Did Chinese Outward Activity Attenuate or Aggravate the Great Recession in Developing Countries? (February 3, 2016). CESifo Working Paper Series No. 5735, Available at SSRN: https://ssrn.com/abstract=2744527

Bastian Gawellek

University of Leipzig ( email )

Marschnerstrasse 31
D-04109 Leipzig, 04109
Germany

Jingjing Lyu

University of Leipzig - Institute for Empirical Research in Economics (IEW) / Econometrics ( email )

Grimmaische Strasse 12
Leipzig, 04109
Germany

Bernd Süssmuth (Contact Author)

University of Leipzig ( email )

IEW Institute for Empirical Research in Economics
Grimmaische Str. 12
Leipzig, D-04109
Germany
+49 341 97 33782 (Phone)
+49 341 97 33789 (Fax)

HOME PAGE: http://www.wifa.uni-leipzig.de/iew/professur-oekonometrie/team/prof-dr-bernd-suessmuth.html

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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