Do we have to look at China to tell our fortune?

Dumont, Michel (2005): Do we have to look at China to tell our fortune?

Abstract

In this paper changes in market shares have been used to proxy the competitiveness of a group of countries, in the full awareness of its coarseness. The competitiveness effects, computed from a dynamic shift share analysis (i.e. computing changes for each year of a given period rather than computing changes over the entire period) have been used to estimate the impact of China on the other countries. Panel estimations of single country equations suggest a statistically significant negative impact of China’s competitiveness on Denmark, Hong Kong, Ireland, Italy, the United Kingdom and the United States. However, taking into account the endogeneity of right-hand side variables using a GMM estimation of simultaneous equations the impact of China is no longer significant for any of the countries considered and the impact of other countries, e.g. the United States, is more ambiguous than in the single equation estimations.

• Item Type: MPRA Paper
• Language: English
• Keywords: Competitiveness, Shift share analysis, China
• Subjects: F - International Economics > F1 - Trade > F11 - Neoclassical Models of Trade; F - International Economics > F1 - Trade > F12 - Models of Trade with Imperfect Competition and Scale Economies ; Fragmentation; F - International Economics > F1 - Trade > F14 - Empirical Studies of Trade; F - International Economics > F6 - Economic Impacts of Globalization > F62 - Macroeconomic Impacts; F - International Economics > F6 - Economic Impacts of Globalization > F63 - Economic Development

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