China's Trade Flows: Changing Price Sensitivities and the Reform Process

37 Pages Posted: 10 Feb 2006

See all articles by Valerie Cerra

Valerie Cerra

International Monetary Fund (IMF)

Anuradha Dayal-Gulati

International Monetary Fund (IMF)

Date Written: January 1999

Abstract

Over the past 20 years, the Chinese authorities have undertaken wide-ranging reforms of their exchange and trade systems that have steadily reduced the role of planning and increased the importance of market forces. As these reforms have taken root, relative prices and domestic and foreign demand would be expected to have played a bigger role in determining trade flows. Econometric estimates of export and import equations provide evidence that trade flows have indeed become increasingly price sensitive, owing to the gradual liberalization of the trade regime over time, and to the growing shares of foreign-funded enterprises and manufactures in total trade.

Keywords: Trade reform, China Exports, Imports, Price elasticity, Econometric models

JEL Classification: C22, F14, F41, N75

Suggested Citation

Cerra, Valerie and Dayal-Gulati, Anuradha, China's Trade Flows: Changing Price Sensitivities and the Reform Process (January 1999). IMF Working Paper No. 99/1, Available at SSRN: https://ssrn.com/abstract=880528

Valerie Cerra (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-8596 (Phone)

Anuradha Dayal-Gulati

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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