How China Navigated the Dilemma of Trade Liberalization and Government Revenues

Many economists believe that in the long run, the aggregate performance of open economies is better than that of closed ones, and that open policies contribute significantly to economic development. At the same time, many political scientists and policy makers fear that, in the short run, one of the steps towards openness — trade liberalization — may harm government revenues. However, in the 1990s, China successfully navigated the dilemma of trade liberalization and government revenues. In this period, China decreased tariff and non‐tariff barriers for WTO accession, but has achieved dramatically increased tariff revenues since 1999. This study explores how China implemented trade liberalization and simultaneously increased tariff revenues in the 1990s. It demonstrates that a series of institutional arrangements, including a reform of Criminal Law, rigorous anti‐smuggling activities and a de facto tax imposed on the export sector, successfully curbed smuggling activities through the processing trade, and made foreign‐invested manufacturing enterprises the major contributors to the stability of customs revenue. China's case shows that a prosperous, export‐oriented and foreign‐invested manufacturing sector could potentially provide a developing country with a source of customs revenue.     

Unravelling the Relationships between Used‐Clothing Imports and the Decline of African Clothing Industries

African clothing industries have declined since the implementation of economic liberalization policies in the early 1980s whilst used‐clothing imports to Africa have increased. The general effects of economic liberalization on African clothing industries are well documented, although little research has been conducted on the particular impact of increased imports of second‐hand clothes on the local manufacturing sectors. Whether these two processes are causally related is difficult to determine due to limitations in official data sets. In this article, the used‐clothing trade is explored in detail and a broad range of cultural and local economic processes are investigated. Trends such as declining local purchasing power and the opening of African markets to cheap new clothing imports, as well as imports of used‐clothing, are examined, along with the converse boost to African clothing export production resulting from preferential trade agreements in the 2000s. With respect to the differential legal and illegal imports of second‐hand clothing to selected African countries, it is demonstrated that official trade data sets often fail to capture the nuances of contemporary social and economic processes.     

Export of Services of Servicing Exports?

Information and communications technology has ensured that many producer services, as well as more ‘basic’ services such as transportation or insurance, are now more tradable than ever. All the indications are that this trade will increase. This has raised the international profile of service and altered governments to their potential as sources of export revenue. This is seen as one way of enhancing national (or regional) economic performance. But should this be assumed to be a panacea for improving national economic growth and restructuring? The general pattern and structure of international trade in services is examined to show that, while valuable, the direct contribution of services to national exports is actually growing relatively slowly and the pattern of trade is highly concentrated. It may actually be important to recognize and nurture the indirect contribution of services to overall national export activity. Goods production and distribution is increasingly dependent on service knowledge and skill; its export competitiveness is a function of the expertise and intellectual knowledge (mainly services) incorporated in the products, the ‘value’ of those products to consumers, and the ways in which they reach out to their markets.     

中国电子机械制造业出口产品贸易网络研究——基于产品内分工与贸易视角

在区分中间/最终产品、一般/加工贸易后，描述了中国电子机械制造业出口产品贸易网络，并探讨了出口经验和产品关联如何影响企业进入网络从事出口和拓展优势贸易伙伴。结果表明：①出口地、目的国、出口地-目的国维度出口经验和产品关联可以显著地促进4种电子机械制造业产品企业进入特定贸易网络进行出口。②在位出口企业扩展优势伙伴方面，出口地-目的国维度出口经验对4种企业均有促进作用；目的国出口经验、出口地产品关联的促进作用集中在中间产品企业；出口地出口经验则集中在一般贸易企业。     

Foreign Direct Investment and State Export Performance

Since the early 1980s, there has been widespread debate over the impacts of rising levels of inward foreign direct investment (FDI) on the U.S. economy. A frequently noted, but little studied, issue within the debate is the impact of FDI on U.S. foreign trade, and particularly, on the foreign trade of U.S. regions. This study assesses the effects of FDI on the manufacturing export performance of U.S. states during the period from 1980 to 1991. Results indicate that increased levels of FDI are positively related to future improvements in state manufacturing export performance.     

Foreign Direct Investment and Regional Export Performance in China

This paper investigates the impact of foreign direct investment (FDI) on the export performance of China at the provincial level. First, it presents a theoretical discussion of the impact of FDI on foreign trade, and then an empirical study of the impact of FDI on the export performance of regions in Chin. It has been found that the impact of FDI on exports differs across three macro-regions in China. The effect is stronger in the coastal region than in the inland regions. Although FDI shows a positive and significant impact on exports from the central region, its impact on the western region is found to be insignificant.     

基于知识产权视角下的中国区域对外贸易发展空间格局研究

在经济全球化背景下,知识产权与对外贸易具有十分密切的联系,知识产权既是对外贸易的重要内容,也是各国开展对外贸易的核心竞争力所在,知识产权保护更是推动了对外贸易的发展。中国企业出口产品的知识产权含量亟待提高,在货物贸易和服务贸易方面均有体现,区域性不均衡特点也十分明显。要转变中国对外贸易的发展模式,就要结合各区域对外贸易的特点,强化知识产权战略的指导作用,加强对知识产权的战略性创造、运用和保护,推动区域对外贸易的可持续发展。     

Trade Liberalization and the Fiscal Squeeze: Implications for Public Investment

This article examines the impact of trade liberalization on the level and structure of government expenditures across countries, with particular emphasis on low income countries. It develops the argument that the policies employed during trade liberalization have resulted in a fiscal squeeze as a result of declining tax revenues and rising interest expenditures. To surmount this fiscal hurdle, expenditures on physical capital, which have negligible political ramifications, have been reduced. Other more politically sensitive expenditures, such as spending on social capital, have been financed by incurring additional debt. However, additional debt has exerted upward pressure on interest payments, further exacerbating the fiscal situation. The statistical analysis carried out to examine the evidence uses panel data for eighty developing and industrialized countries over the period 1970–98 and employs a fixed–effects regression framework to account for country–specific characteristics. The results indicate that trade liberalization has indeed resulted in declining revenues and higher interest expenditures and that these factors have contributed to the observed decline in infrastructure spending.     

中俄双边旅游与进出口贸易互动关系的实证研究

以1998-2011年中俄两国旅游与贸易数据为基础,利用格兰杰因果关系检验发现俄国出境旅游是进出口贸易的单向格兰杰原因,中国进出口贸易是出境旅游的单向格兰杰原因。旅游与贸易互动关系研究结果表明:俄国出境旅游对进出口中国贸易均有着明显的推动作用,并对进口贸易的推动作用要明显强一些;中国进出口贸易对出境俄旅游都有明显的促进作用,进口贸易的促进作用要略强一点。俄罗斯断面看,占中国入境旅游比对对华贸易依存度有一定影响;中国断面看,中国对俄贸易依存度对出境俄旅游偏好和占俄入境旅游比影响均较大。两国旅游与贸易的互动性差异特征分析能为两国双边旅游与贸易良性互动发展提供相应参考。     

20世纪90年代的中日纤维产品贸易

20世纪90年代中日两国贸易结构发生较大变化,即中国对日本出口的食品及矿产等初级产品在对日出口总额中降到不足一成,而纤维产品贸易以几乎每年占中日贸易额的20～30％的速度强劲发展,推动了两国贸易总额的迅速增长,但同时也引起贸易摩擦。尽管纤维产品贸易由垂直贸易分工向初级水平贸易分工发展,以及密切的依存关系两大特征,使中日两国避免了在该领域的贸易战,但是,如何在互补性贸易结构中寻求更多的合作领域以减少贸易摩擦甚至避免贸易战争,是20世纪90年代中日纤维产品贸易带来的重要启示。     

Economic integration and the diversification of regional exports: evidence from the Canadian-U.S. Free Trade Agreement

We investigate the impact of Canada–U.S. trade integrationon the degree of export diversification of the Canadian regions.Trade integration is captured through the decrease of trade-weightedtariffs that were boosted by implementation of the Canadian–U.S.Free Trade Agreement. We found strong evidence to support integration'slong-run impact on the patterns of absolute exports diversification.Significantly, this new finding remains robust to the exclusionof the primary sectors and to the potential presence of unitroot in the data. Our results lead us to support a positivelong-run relationship between trade integration and export diversification.     

External Financial Liberalization and Macroeconomic Performance in Emerging Countries: An Empirical Evaluation of the Brazilian Case

This article evaluates the effects of external financial liberalization on Brazilian macroeconomic performance from 1995 to 2016. Its main contributions are to assess the influence of the global financial cycle on the level of external financial liberalization and to analyse the short- and long-run macroeconomic effects of such liberalization on the performance of a peripheral economy in the global currency hierarchy. Methodologically, the article employs the Markov-Switching Vector Autoregressive and Vector Error Correction models. The results show that the global financial cycle directly affects cross-border financial flows and frames the impact of external financial liberalization on the macroeconomic performance. The article concludes that external financial liberalization has negative macroeconomic effects in the short run and generates a trade-off between stability and growth in the long run.     

Spatial Inequality Between and Within Urban Areas: The Case of Israeli Cities

Central areas enjoy greater efficiency in the production of goods and services than do outlying areas. Because of the inherent advantages of central areas over outlying areas, disparities among regions do not vanish over time. On the contrary, centripetal forces increase inequalities across space. The phenomena of increased globalization, trade liberalization and treaties among countries not only enable the flow of labour, products (export) and foreign direct investment but also help reduce spatial inequality between countries. These phenomena also induce greater spatial economic concentration within a country. Thus, although disparities among countries decrease, a widening gap is observed between regions within countries and within large urban areas. In the empirical part, we analyse the general patterns of spatial inequality found among 55 localities in Israel with population size over 20,000. Looking at the spatial inequality relationship, both within and between cities in Israel, we show how all economic indicators measured, including inequality, decrease with distance from the core. Localities in the periphery that experience greater equality also experience lower average income, lower education, less self-employment and more unemployment.     

The Geographic Effects of Trade Liberalization with Increasing Returns in Transportation

Abstract This paper develops a model of economic geography that examines how the distribution of economic activity may change as a country opens up to foreign trade. The distinctive features of the model are that transportation is costly between locations within a nation as well as between nations, and that these transportation costs are subject to increasing returns to scale. A result of the model is that trade liberalization may cause the population of a country to become more concentrated in a single megalopolis. The large megalopolis may reduce welfare due to congestion costs, which implies that liberalization may unexpectedly leave the country worse off.     

NAFTA and the Pollution Haven Hypothesis

The “Pollution Haven Hypothesis” is the prediction that trade liberalization will lead to the movement of polluting industries from high income/stringent environmental regulation countries to low income/lax environmental regulation countries. This prediction has led to concerns that NAFTA would be an environmental disaster for Mexico. The three articles included in this collection investigate the post‐NAFTA environmental performance of Mexico using both aggregate data on pollution emissions as well as firm‐level data on environmental abatement efforts. In this article, I summarize the contribution in the context of the trade/environmental literature and provide some suggestions for future work.     

Trade Fairs as an Export Marketing and Research Strategy: Results from a Study of Korean Advanced Machinery Firms

Manufacturers pursuing information on potential customers in distant, dynamic markets confront myriad obstacles. To address this, many firms attend international trade fairs in order to market their products, to meet with prospective customers, and to tap into buzz related to potential international opportunities. In many ways, moreover, such exhibitions can serve as short‐term agglomerations of same‐industry activity, particularly important for producer–user interface geared towards innovation. The goal of this paper is to explore how Korean machine tool manufacturers utilise a major global trade show in Seoul to minimise the difficulties associated with accessing a global customer base, inclusive of their activity at this show geared towards innovation. Evidence from firm‐level surveys and interviews suggest that the amount of importance placed on trade fair attendance as part of a firm's internationalisation strategies is related to export growth. Additionally, a new insight generated is that firms that participate in trade shows as part of their innovation process also demonstrate higher rates of export intensity. Finally, we may be witnessing newly discovered, technology‐driven, symbiotic relationships between online portal sites, vendors, and potential customers at these trade fairs, where virtual services are nonetheless augmented by a need for a continued onsite presence at these exhibitions.     

中国食品出口贸易地理网络演化

华人网络与文化距离对中国食品行业贸易地理网络的形成与演化具有显著影响.本文基于2000-2016年中国海关贸易数据库,首先展示中国各省份食品贸易地理网络格局及其演化趋势,研究发现我国东部省份以东亚和北美为主要出口目的地,中西部省份贸易网络的空间不均衡性较强,且各省份食品出口均有贸易联系强化和目的国多样化特征.其次,构建...     

Missing an opportunity: the Italian Mezzogiorno's trading troubles during European integration

Among the many troubles that southern Italy's economy is facing, its deficient trade performance receives little attention. Yet the Mezzogiorno's comparative disadvantage in trade is a recurring theme in the long history of Italian inter-regional disparities. Adverse conditions for firms in tradeables persist while European integration opens up new opportunities for this sector to expand. In this paper, a dataset of employment rates in tradeable and non-tradeable sectors from 2000 to 2010 is constructed to analyse the strength and development of the Mezzogiorno's export base during European integration. The analysis shows that the new trade opportunities alone did not suffice to even the Mezzogiorno regions' road to export orientation.     

日本的FTA战略动向及其对中国的影响

上世纪90年代末,随着第3次FTA浪潮的掀起,日本的通商政策开始出现转变。从以多边体系为中心的通商政策,逐步转向双边、区域、多边共同推进的多层次的通商政策。日本在本地区推行以本国为中心的FTA战略,战略设计上置中国于优先顺序之外,协定内容中将农产品最大限度的采取例外处理,政策制定上又受到传统的战略盟国美国的牵制。在今后的区域经济一体化及中日FTA问题上,日本的农产品贸易自由化问题仍将是主要障碍。而且,中日两国争相与东盟缔结FTA的结果使东盟的中心地位更加明显,长期维持这种结构会导致贸易和投资转移效应的产生。     

TNC Strategies and Variations in Intra-firm Trade: The Case of Foreign Manufacturing Affiliates in Sweden

The aim of this paper is to contribute to the understanding of the forms and determinants of intra-firm trade, i.e. international trade between different units under common TNC ownership, this being a major indication of 'deep economic integration' between developed countries in the 1990s. Theoretically, intra-firm trade can be explained by the existence of economies of common governance and are often found to be associated with R&D-intensive industries and economies of scale. In empirical studies, intra-firm trade is often found to consist of intermediate inputs goods, resulting in vertically integrated production chains. The study is based on detailed firm-level data from around 300 foreign majority-owned affiliates (MOFAs) in manufacturing, in Sweden in 1993. The results show that intra-firm sales by MOFAs in Sweden are as high as those found in studies of manufacturing affiliates of US TNCs. Almost all of MOFAs' intra-firm exports are finished products, while intra-firm imports consist of material inputs and finished products for resale. This suggests that these MOFAs are only marginal involved in vertically integrated production chains, especially in terms of exports. The results of a regression analysis complement earlier studies by showing that the level and composition of intra-firm trade is significantly affected by the international strategy applied by TNCs when operating foreign manufacturing affiliates. Intra-firm exports of finished products and material inputs are positively associated with efficiency-seeking FDI, e.g. affiliates engaged in rationalised production. Market-seeking FDI is associated with intra-firm imports of complementary finished products for resale. By contrast, resource-seeking and strategic asset-seeking FDI was negatively associated with intra-firm trade.