Who Benefits of Trade with China? Examining the Effects of Free Trade Agreements on Trade Flow with China Using an Adjusted Gravity Model

• Autorzy: Sigurður Guðjonsson , Inga Minelgaite , Hrafnhildur Kristinsdóttir , Jelena Stankevičienė
• Języki publikacji: EN

Abstrakty

EN

China has numerous free trade agreements with various countries. In this research it will be examined who benefits from those free trade agreements. The sample includes 27 countries trading with China but 13 of these countries have signed a free trade agreement with China, or roughly half of all the available countries in our sample. The sample data are from 2001 - 2017. An adjusted gravity model and a linear regression was carried out. While those countries that have made free trade agreement with China experienced modest or no increase in export to China, China itself experienced significant increase in export to its free trade partners after the agreement took place. In comparison, we carried out a linear regression of the total 27 countries where the trading countries experienced increase in export to China and China itself experienced increase in export to these countries as well. It is therefore safe to conclude that China is a beneficiary of free trade agreements at least as much as it´s trade partners. (original abstract)

Słowa kluczowe

EN

Trade agreement; Import; Export; International trade; Gravity model

PL

Umowa handlowa; Import; Eksport; Handel międzynarodowy; Model grawitacji

• Czasopismo: Journal of International Studies
• Rocznik: 2021
• Tom: 14
• Numer: nr 3
• Strony: 9--25

Twórcy

autor

Sigurður Guðjonsson

• University of Iceland, Iceland

autor

Inga Minelgaite

• University of Iceland, Iceland

autor

Hrafnhildur Kristinsdóttir

autor

Jelena Stankevičienė

• Vilnius Gediminas Technical University, Lithuania

Bibliografia

• Aitken, N.D. (1973). The effect of the EEC and EFTA on European trade: A temporal cross-section analysis. American Economic Review. 5, 881-892.
• Anderson, J.E. (1979). A theoretical foundation for the fravity equation. The American Economic Review, 69(1), 106-116.
• Anderson, J., & van Win, E. (2003). Gravity with gravitas: A solution to the border puzzle. The American Economic Review, 93(1), 170-192. doi: 10.1257/000282803321455214
• Asia Regional Integration Center, (n.d.). Trade and Investment. Mongolia-People's Republic of China Free Trade Agreement. https://aric.adb.org/fta/peoples-republic-of-china-mongolia-free-trade-agreement
• Baier, S.L., & Bergstrand, J.H. (2007). Do free trade agreements actually increase members' international trade? Journal of International Economics. 71(1), 72-95. doi: 10.1016/j.jinteco.2006.02.005
• Baier, S.L., & Bergstrand, J.H. (2002). On the endogeneity international trade flows and free trade agreements. Unpublished manuscript, University of Notre Dame.
• Bagwell, K., & Staiger, Y. (2005). Erratum to multilateral trade negotiations, bilateral opportunism and the rules of GATT/WTO. Journal of International Economics. 67(2), 268-294. doi: 10.1016/j.jinteco.2005.06.001
• Baldwin, R.E. (2006). Multilateralising regionalism: Spaghetti bowls as buildings blocs on the path to global free trade. The World Economy. 29(11), 1451-1518.
• Bayoumi, T. & Eichengreen, B. (1997). Is regionalism simply a diversion? Evidence from the evolution of the EC and EFTA. In: Ito, Takatoshi, Krueger, Anne O. (Eds.), Regionalism vs. Multilateral Arrangements. The University of Chicago Press, Chicago.
• Bergstrand, J.H. (1985). The gravity equation in international trade: Some microeconomics foundations and empirical evidence. The Review of Economics and Statistics. 67(3), 474-481. doi: 10.2307/1925976
• Bergstrand, J.H. (1989). The generalized gravity equation, monopolistic competition, and the factor-proportions theory in international trade. The Review of Economics and Statistics. 71(1), 143-153. doi: 10.2307/1928061
• Beugelsdijk, S., Ambos, B., & Nell, P. C. (2018). Conceptualizing and measuring distance in international business research: Recurring questions and best practice guidelines. Journal of International Business Studies. doi.org/10.1057/s41267-018-0182-4.
• Brugier, C.M. (2017). The EU's trade stratefy towards China: Lessons for an effective turn. Asia Europe Journal. 15, 199-212. doi: 10.1007/s10308-017-0475-4
• Chang, V.K.L., & Pieke, F.N. (2017). Europe's engagement with China: shifting Chinese views of the EU and the EU****China relationship. Asia Europe Journal. 16, 317-331. doi: 10.1007/s10308-017-0499-9
• China FTA Network. (n.d.). Retrieved February 25, 2020 from http://fta.mofcom.gov.cn/english/index.shtml
• Ciuriak, D., & Kinjo, S. (2006). Trade specialization in the gravity model of international trade. Trade Policy Research 2005, 189-197.
• Crowley, M., Exton, O., & Han, L. (2018) Renegotiation of Trade Agreements and Firm Exporting Decisions: Evidence from the Impact of Brexit on UK Exports. Society of International Economic Law (SIEL), Sixth Biennial Global Conference, Available at SSRN: https://ssrn.com/abstract=3211689 or http://dx.doi.org/10.2139/ssrn.3211689
• Deardorff, A. (1984). "Testing trade theories and predicting trade flows," in R. Jones and P. Kenen, eds., Handbooks of international economics. 1, 467-517. Amsterdam: Elsevier. doi: 10.1016/S1573-4404(84)01013-3
• Do, A. D., Nguyen Q. V., Le, Q. H., & Ta, V. L. (2020). Green Supply Chain Management in Vietnam Industrial Zone: Province-Level Evidence. Journal of Asian Finance, Economics and Business, 7(7), 403-412. doi.org/10.13106/jafeb.2020.vol7.no7.403
• Dreher, A., (2006). Does globalization affect growth? Evidence from a new index of globalization. Applied Economics. 38(10), 1091-1110. doi: 10.1080/00036840500392078
• EFTA. (n.d.). European economic area (eea) / relations with the EU. https://www.efta.int/eea
• EFTA. (n.d.). EEA agreement. https://www.efta.int/eea/eea-agreement
• Eicher, T.S. & Henn, C. (2011). In search of WTO trade effects: Preferential trade agreements promote trade strongly, but unevenly. Journal of International Economics. 83(2), 137-153. doi: 10.1016/j.jinteco.2010.12.002
• Endoh, M. (2010). Trade creation and trade diversion in the EEC, the LAFTA and the CMEA: 1960-1994. Applied Economics, 31(2), 207-216. doi: 10.1080/000368499324435
• Elliott, R. J.R., &Ikemoto, K. (2004), "AFTA and the Asian Crisis: Help or Hindrance to ASEAN Intra- Regional Trade?" Asian Economic Journal, 18(1), 1-23.
• ETH Zurich KOF. (2018, December 27). KOF globalisation index: Globalisation lull continues. https://kof.ethz.ch/en/news-and-events/media/press-releases/2018/12/kof-globalisation-index****globalisation-lull-continues.html
• European Union. (2019, August 6). What the EU does for its citizens. https://europa.eu/european-union/about-eu/what****the-eu-does-for-its-citizens_en
• European Union. (2019, March 13). Single market. https://europa.eu/european-union/topics/single-market_en
• European Union. (2019, November 6). Trade. https://europa.eu/european-union/topics/trade_en
• Frankel, J. & Rose, A. (2002). An estimate of the effect of common currencies on trade and income. The Quarterly Journal of Economics. 117(2), 437-466. doi: 10.1162/003355302753650292
• Frankel, J. A., Stein. E., & Wei, S.J. (1995). Trading blocs and the Americas: The natural, the unnatural, and the super****natural. Journal of Development Economics. 47(1), 61-95.
• Glesjer, H., Goossens, K., & Vanden Eede, M. (1982). Inter-industry versus intra-industry specialization in exports and imports (1959-1970-1973). Journal of International Economics. 12(3-4), 363-369. doi: 10.1016/0022-1996(82)90046-0
• Gygli, S., Haelg, F., Potrafke, N., & Sturm, J.E. (2019). The KOF globalisation index - revisited. The Review of International Organizations. 14, 543-574. doi: 10.1007/s11558-019-09344-2
• Griese, O. (2006). EU-China relations-an assessment by the communications of the European Union. Asia Europe Journal. 4(4), 545-553. doi: 10.1007/s10308-006-0087-x
• Handley, K. (2012). Country size, technology and manufacturing location. Review of International Economics, 20(1), 29-45. doi: 10.1111/j.1467-9396.2011.01005.x
• Handley, K., & Limao, N. (2017). "Policy uncertainty, trade and welfare: Theory and evidence for China and the United States". American Economic Review. 107(9), 2731-83. doi: 10.1257/aer.20141419
• He, L.Y., Lin, X., & Liu, Q. (2020). How Did Free Trade Reshape the Transitional China? Evidence from Heterogeneous Exporters and Firm-Level Pollution Emissions. Emerging Markets Finance and Trade. 56(8), 1651-1676. doi.org/10.1080/1540496X.2019.1620101
• International Monetary Fund. (2020). Direction of Trade Statistics (DOTS). https://data.imf.org/?sk=9D6028D4-F14A****464C-A2F2-59B2CD424B85
• Irshad, M.S., Xin, Q., Hao, H., & Arshad, H. (2017). SWOT analysis of Pakistan-China free trade agreement: Pros and cons. International Journal of Asian Social Science, 7(1), 45-53.
• Irshad, M. S., Xin, Q., Hui, Z., & Arshad, H. (2018). An empirical analysis of Pakistan's bilateral trade and trade potential with China: A gravity model approach, Cogent Economics & Finance, 6(1). doi: 10.1080/23322039.2018.1504409
• Kang, J.G., Yoon, J.M. (2020). Empirical Analysis on the Current Status and the Development of Bilateral Trade according to the Promotion of Korea-Japan FTA. Asia-pacific Journal of Convergent Research Interchange, 6(9). 47-62. doi.org/10.47116/apjcri.2020.09.05
• Kien, N.T., & Hashimoto, Y. (2005). Economic analysis of ASEAN free trade area; By a country panel data. (Discussion Paper 05-12). Japan: Osaka University.
• Kim, S., & Shin, E.H. (2002). A longitudinal analysis of globalization and regionalization in international trade: A social network approach. Social Forces. 81(2), 445-468. doi: 10.1353/sof.2003.0014
• Lai, P., & Li, Q. (2013). Development in China's foreign trade: 2003-2012. China & World Economy. 21(6), 58-78. https://doi.org/10.1111/j.1749-124X.2013.12046.x
• Lakatos, C., & Nilsson, L. (2017). The EU-Korea FTA: anticipation, trade policyuncertainty and impact. Rev World Econ 153, 179-198. DOI 10.1007/s10290-016-0261-1
• Lanteigne, M. (2010). Northern exposure: Cross-regionalism and the China-Iceland preferential trade negotiations. The China Quarterly. 202, 362-280. doi: 10.1017/S0305741010000287
• Linnemann, H. (1966). An econometric study of international trade flows. Amsterdam.
• Linneman, H. (1996). On trade and growth. De Economist. 144(2), 325-332. Doi: 10.1007/BF01681906
• Linsi, L., & Mugge, D.K. (2019). Globalization and the growing defects of international economic statistics. Review of International Political Economy. 26(3), 361-383. doi.org/10.1080/09692290.2018.1560353
• Markusen, J. R. (2004). Multinational Firms and the theory of international trade. The MIT Press. Cambridge: MA.
• Medin, H. (2019). Free trade agreements in a small, open country: The case of Norway. The World Economy. 42(12), 3438-3446. doi.org/10.1111/twec.12876.
• Melchior., A. (2018). Trade, USA and the Rise of China: Pains and Gains. Free Trade Agreements and Globalisation. 115-130. DOI: 10.1007/978-3-319-92834-0_7
• McCallum, J. (1995). National borders matter: Canada-U.S. regional trade patterns. The American Economic Review. 85(3), 615-623.
• Nguyen, D.B. (2019). A New Examination of the Impacts of Regional Trade Agreements on International Trade Patterns. Journal of Economic Integration 34 (2)2 pp. 236-279. Doi.org/10.11130/jei.2019.34.2.236
• Park, D., & Shin, K. (2009). Saving, inversment, and current account surplus in developing Asia. Asian Developent Bank Economics (working paper no. 158). doi: 10.2139/ssrn.1611454
• Péridy, N. (2005). The trade effects of the Euro-Mediterranean partnership: What are the lessons for ASEAN countries? Journal of Asian Economics. 16(1), 125-139. doi: 10.1016/j.asieco.2004.12.001
• Potrafke, N. (2014). The evidence on globalisation. The World Economy. 38(3), 509-552. doi: 10.1111/twec.12174
• Qiang, F., & Bayanjargal, S. (2016). The study on trade policy and openness of Mongolia: Influences on trade flows between China-Mongolia-Russia (past and future). Chineses Business Review. 15(5), 249-264. doi: 10.17265/1537-1506/2016.05.004
• Rose, A. (2004). Do we really know that the WTO increases trade? American Economic Review. 94(1), 98-114. doi: 10.1257/000282804322970724
• Schott, J.J. (1991). Trading blocs and the world trading system. The World Economy. 14(1), 1-18. doi: 10.1111/j.1467-9701.1991.tb00748.x
• Shahriar,S., Qian, L., Kea, K. (2019). Determinants of exports in China's meat industry: a gravity model analysis Emerg. Mark. Finance Trade. 55 (2019), pp. 2544-2565. doi.org/10.1080/1540496X.2019.1578647
• Shujiro, U., & Misa, O. (2007). The impacts of free trade agreements on trade flows: An application of the gravity model approach. (Discussion Paper 07-E-052). Japan: Kyoto Gakuen University.
• Soni S.K. (2018) China-Mongolia-Russia Economic Corridor: Opportunities and Challenges. In: Deepak B. (eds) China's Global Rebalancing and the New Silk Road. Springer, Singapore. doi: 10.1007/978-981-10-5972-8_9
• Squartini, T., and Garlaschelli, D. (2014). Jan Tinbergen's legacy for economic networks: From the gravity model to quantum statistics. In: Abergel F., Aoyama H., Chakrabarti B., Chakraborti A., Ghosh A. (eds) Econophysics of Agent-Based Models. New Economic Windows. Springer, Cham. Doi: 10.1007/978-3-319-00023-7_9
• Sumbramanian, A., & Wei, S.J. (2007). The WTO promotes trade, strongly but unevenly. Journal of International Economics. 72(1), 151-175. doi: 10.1016/j.jinteco.2006.07.007
• Tinbergen, J. (1962). Shaping the World Economy; Suggestions for an International Economic Policy. Books (Jan Tinbergen). Twentieth Century Fund, New York. Retrieved from http://hdl.handle.net/1765/16826
• Ulzii-Ochir, N., & Vorshilov, E. (2016). Study on the impact of a free trade agreement between Mongolia and the Eurasian Economic Union. The Northeast Asian Economic Review. 4(2), 37-51.
• World Bank. (2019). Data. Retrieved March 6, 2020, from https://data.worldbank.org/
• World Economic Forum. (2017, May 9). What is ASEAN? https://www.weforum.org/agenda/2017/05/what-is****asean-explainer/
• World Trade Organization. (2015). International trade statistics 2015. https://www.wto.org/english/res_e/statis_e/its2015_e/its15_toc_e.htm
• Xiang, H., Kuang, Y., & Li, C. (2017). Impact of the China-Australia FTA on global coal production and trade. Journal of Policy Modeling, 39(1), 65-78. doi.org/10.1016/j.jpolmod.2017.01.001
• Yihong, T., & Weiwei, W. (2006). An analysis of trade potential between China and ASEAN within China-ASEAN FTA. Paper presented on 24-25 June at the Conference on WTO, China and the Asian Economies. Beijing, China.
• Zhang, Y., Zhang, G., & Fung, H.G. (2007). The prospects for China's free trade agreements. The Chinese Economy, 40(2), 5-35, doi: 10.2753/CES1097-1475400201
• Zhao, W., Rut, J. (2020). Managing the "Post Miracle" Economy in China: Crisis of Growth Model and Policy Responses. Post-Communist Economies, 1-23 doi: https://doi.org/10.1080/14631377.2020.1867427

Identyfikatory

DOI

10.14254/2071-8330.2021/14-3/1