Regional Variation in Trade Liberalization Outcomes: Evidence from Chinese Manufacturing Industry
Year: 2015
Type: report
Abstract: This paper studies the impact of import tariff reduction and its interaction with market-oriented policies on regional manufacturing output in China between 1998 and 2006. I address the concern of tariff endogeneity by exploiting the fact that tariffs of WTO members are bound by common exogenous WTO regulations. Using changes in Albania and Lithuania's tariffs as instruments for China's tariff concessions, I find that lower tariffs on final goods reduce real output while lower tariffs on intermediate inputs increase real output, and the effects are smaller in prefectures with policy zones. These results highlight the importance of local institutions and economic policies in determining the trade reform outcomes.
Author: Wenya Cheng
Institution: University of Manchester
Language: English
Topic: Global trade and economics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2566995424