China's Growing Role in World Trade (National Bureau of Economic Research Conference Report)

In less than three decades, China has grown from playing a negligible role in world trade to being one of the world's largest exporters, a substantial importer of raw materials, intermediate outputs, and other goods, and both a recipient and source of foreign investment. Not surprisingly, China's economic dynamism has generated considerable attention and concern in the United States and beyond. While some analysts have warned of the potential pitfalls of China's rise—the loss of jobs, for example—others have highlighted the benefits of less expensive goods and services purchased by U.S. consumers along with new market and investment opportunities for U.S. firms. Bringing together an expert group of contributors, China's Growing Role in World Trade undertakes an empirical investigation of the effects of China's new status. The essays collected here provide detailed analyses of the microstructure of trade, the macroeconomic implications, sector-level issues, and foreign direct investment. This volume's careful examination of micro data in light of established economic theories clarifies a number of misconceptions, overturns some conventional wisdom, and documents data patterns that enhance our understanding of issues related to China's trade. Microstructure Of International Trade -- The Anatomy Of China's Export Growth / Mary Amiti And Caroline Freund -- Comment: Bin Xu -- What Accounts For The Rising Sophistication Of China's Exports? / Zhi Wang And Shang-jin Wei -- Comment: Galina Hale -- China's Local Comparative Advantage / James Harrigan And Haiyan Deng -- Comment: Chong Xiang -- China And The Manufacturing Exports Of Other Developing Countries / Gordon H. Hanson And Raymond Robertson -- Comment: Irene Brambilla -- Macroeconomic Issues -- China's Exports And Employment / Robert C. Feenstra And Chang Hong -- Comment: Michael Dooley -- Exporting Deflation? : Chinese Exports And Japanese Prices / Christian Broda And David E. Weinstein -- Comment: Joshua Aizenman -- China's Current Account And Exchange Rate / Yin-wong Cheung, Menzie D. Chinn, And Eiji Fujii -- Comment: Jeffrey Frankel -- Sectoral Issues And Trade Policies -- China's Wto Entry: Antidumping, Safeguards, And Dispute Settlement / Chad P. Bown -- Comment: Thomas J. Prusa -- China's Experience Under The Multifiber Arrangement (mfa) And The Agreement On Textile And Clothing (atc) / Irene Brambilla, Amit K. Khandelwal, And Peter K. Schott -- Comment: Joseph Francois -- Agricultural Trade Reform And Rural Prosperity: Lessons From China / Jikun Huang, Yu Liu, Will Martin, And Scott Rozelle -- Comment: Kym Anderson -- Trade Growth, Production Fragmentation, And China's Environment / Judith M. Dean And Mary E. Lovely -- Comment: Arik Levinson -- Foreign Investment And Trade -- Please Pass The Catch-up: The Relative Performance Of Chinese And Foreign Firms In Chinese Exports / Bruce A. Blonigen And Alyson C. Ma -- Comment: Raymond Robertson -- Facts And Fallacies About U.s. Fdi In China / Lee Branstetter And C. Fritz Foley -- Comment: Stephen Yeaple -- China's Outward Foreign Direct Investment / Leonard K. Cheng And Zihui Ma -- Comment: Nicholas Lardy. Edited By Robert C. Feenstra And Shang-jin Wei. Includes Bibliographical References And Index. Contents......Page 8 Introduction / Robert C. Feenstra and Shang-Jin Wei......Page 12 I. Microstructure of International Trade......Page 44 1. The Anatomy of China’s Export Growth / Mary Amiti and Caroline Freund......Page 46 2. What Accounts for the Rising Sophistication of China’s Exports? / Zhi Wang and Shang-Jin Wei......Page 74 3. China’s Local Comparative Advantage / James Harrigan and Haiyan Deng......Page 120 4. China and the Manufacturing Exports of Other Developing Countries / Gordon H. Hanson and Raymond Robertson......Page 148 II. Macroeconomic Issues......Page 176 5. China’s Exports and Employment / Robert C. Feenstra and Chang Hong......Page 178 6. Exporting Deflation?: Chinese Exports and Japanese Prices / Christian Broda and David E. Weinstein......Page 214 7. China’s Current Account and Exchange Rate / Yin-Wong Cheung, Menzie D. Chinn, and Eiji Fujii......Page 242 III. Sectoral Issues and Trade Policies......Page 290 8. China’s WTO Entry: Antidumping, Safeguards, and Dispute Settlement / Chad P. Bown......Page 292 9. China’s Experience under the Multi-Fiber Arrangement (MFA) and the Agreement on Textiles and Clothing (ATC) / Irene Brambilla, Amit K. Khandelwal, and Peter K. Schott......Page 356 10. Agricultural Trade Reform and Rural Prosperity: Lessons from China / Jikun Huang, Yu Liu, Will Martin, and Scott Rozelle......Page 408 11. Trade Growth, Production Fragmentation, and China’s Environment / Judith M. Dean and Mary E. Lovely......Page 440 IV. Foreign Investment and Trade......Page 484 12. Please Pass the Catch-Up: The Relative Performance of Chinese and Foreign Firms in Chinese Exports / Bruce A. Blonigen and Alyson C. Ma......Page 486 13. Facts and Fallacies about U.S. FDI in China / Lee Branstetter and C. Fritz Foley......Page 524 14. China’s Outward Foreign Direct Investment / Leonard K. Cheng and Zihui Ma......Page 556 Contributors......Page 592 Author Index......Page 596 Subject Index......Page 600 In less than three decades, China has grown from playing a negligible role in world trade to being one of the world's largest exporters, a substantial importer of raw materials, intermediate outputs, and other goods, and both a recipient and source of foreign investment. Not surprisingly, China's economic dynamism has generated considerable attention and concern in the United States and beyond. While some analysts have warned of the potential pitfalls of China's rise - the loss of jobs, for example - others have highlighted the benefits of less expensive goods and services purchased by U.S. consumers along with new market and investment opportunities for U.S. firms. Bringing together an expert group of contributors, "China's Growing Role in World Trade" undertakes an empirical investigation of the effects of China's new status. The essays collected here provide detailed analyses of the microstructure of trade, the macroeconomic implications, sector-level issues, and foreign direct investment. This volume's careful examination of micro data in light of established economic theories eliminates a number of misconceptions, overturns some conventional wisdom, and documents data patterns that enhance our understanding of issues related to China's trade In less than three decades, China has grown from playing a negligible role in international trade to being one of the world's largest exporters, a substantial importer of raw materials, intermediate outputs, and other goods, and both a recipient and source of foreign investment. Not surprisingly, China's economic dynamism has generated considerable attention and concern in the United States and beyond. While some analysts have warned of the potential pitfalls of China's rise—the loss of jobs, for example—others have highlighted the benefits of new market and investment opportunities for US firms. Bringing together an expert group of contributors, China's Growing Role in World Trade undertakes an empirical investigation of the effects of China's new status. The essays collected here provide detailed analyses of the microstructure of trade, the macroeconomic implications, sector-level issues, and foreign direct investment. This volume's careful examination of micro data in light of established economic theories clarifies a number of misconceptions, disproves some conventional wisdom, and documents data patterns that enhance our understanding of China's trade and what it may mean to the rest of the world. In less than three decades, China has grown from playing a negligible role in world trade to being one of the world's largest exporters. This book investigates the effects of China's new status. It provides a detailed analyses of the microstructure of trade, the macroeconomic implications, sector-level issues, and foreign direct investment.