Regulated Efficiency, World Trade Organization Accession, and the Motor Vehicle Sector in China

Tinbergen Institute Discussion Paper No. TI 2004-049/2

33 Pages Posted: 6 May 2004

See all articles by Joseph F. Francois

Joseph F. Francois

University of Bern - Department of Economics; Centre for Economic Policy Research (CEPR); Vienna Institute of International Economic Studies (WIIW); University of Adelaide - School of Economics

Dean Spinanger

University of Kiel - Institute for World Economics (IfW)

Multiple version iconThere are 2 versions of this paper

Date Written: May 4, 2004

Abstract

This paper is concerned with the interaction of regulated efficiency and World Trade Organization (WTO) accession and its impact on China's motor vehicle sector. The analysis is conducted using a 23 sector-25 region computable general equilibrium model. Regulatory reform and internal restructuring are found to be critical. Restructuring is represented by a cost reduction following from consolidation and rationalization that moves costs toward global norms. Without restructuring, WTO accession means a surge of final imports, though imports of parts could well fall as production moves offshore. However, with restructuring, the final assembly industry can be made competitive by world standards, with a strengthened position for the industry.

Keywords: China Accession to WTO, Automobile Sector

JEL Classification: F13, F14, F17

Suggested Citation

Francois, Joseph F and Spinanger, Dean, Regulated Efficiency, World Trade Organization Accession, and the Motor Vehicle Sector in China (May 4, 2004). Tinbergen Institute Discussion Paper No. TI 2004-049/2. Available at SSRN: https://ssrn.com/abstract=539482 or http://dx.doi.org/10.2139/ssrn.539482

Joseph F Francois (Contact Author)

University of Bern - Department of Economics ( email )

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Bern, CH-3001
Switzerland

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Vienna Institute of International Economic Studies (WIIW) ( email )

Oppolzergasse 6
A-1010 Vienna
Austria

University of Adelaide - School of Economics ( email )

Adelaide SA, 5005
Australia
+61 8 8303 5540 (Phone)
+61 8 8223 1460 (Fax)

Dean Spinanger

University of Kiel - Institute for World Economics (IfW) ( email )

Duesternbrooker Weg 120
D-24118 Kiel
Germany
+49 431 8814 x207 (Phone)
+49 431 8814 x500 (Fax)

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