David Versus Goliath: The Impact of Chinese Competition on Developing Countries

Roberto Álvarez; Sebastián Claro

doi:10.1016/j.worlddev.2008.08.009

David Versus Goliath: The Impact of Chinese Competition on Developing Countries

Roberto Álvarez^*, Sebastián Claro

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

36 Scopus citations

Abstract

We use detailed Chilean plant-level data from 1990 to 2000 to study the impact of Chinese import competition in manufacturing industries. We study whether China's imports have been associated with a downsizing of manufacturing plants or whether firms have escaped Chinese competition through changes in output mix, productivity catch-up, or increased exports. Our results show that imports from China have negatively affected employment growth on surviving plants, and increased the probability of exit. In contrast to previous evidence for the United States, we do not find evidence that manufacturing plants have adjusted by producing more sophisticated goods or by exporting.

Original language	English
Pages (from-to)	560-571
Number of pages	12
Journal	World Development
Volume	37
Issue number	3
DOIs	https://doi.org/10.1016/j.worlddev.2008.08.009
State	Published - 2009
Externally published	Yes

Bibliographical note

Funding Information:
We would like to thank three anonymous referees and seminar participants at the Department of Economics and the Center for Applied Economics of the University of Chile, and the Central Bank of Chile for helpful comments and suggestions. Sebastián Claro acknowledges the financial support from Fundación Andes through Grant 14-060-9. This paper does not necessarily reflect the views of the Board of the Central Bank of Chile.

Keywords

China
import competition
manufacturing plants

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10.1016/j.worlddev.2008.08.009

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title = "David Versus Goliath: The Impact of Chinese Competition on Developing Countries",

abstract = "We use detailed Chilean plant-level data from 1990 to 2000 to study the impact of Chinese import competition in manufacturing industries. We study whether China's imports have been associated with a downsizing of manufacturing plants or whether firms have escaped Chinese competition through changes in output mix, productivity catch-up, or increased exports. Our results show that imports from China have negatively affected employment growth on surviving plants, and increased the probability of exit. In contrast to previous evidence for the United States, we do not find evidence that manufacturing plants have adjusted by producing more sophisticated goods or by exporting.",

keywords = "China, import competition, manufacturing plants",

author = "Roberto {\'A}lvarez and Sebasti{\'a}n Claro",

note = "Funding Information: We would like to thank three anonymous referees and seminar participants at the Department of Economics and the Center for Applied Economics of the University of Chile, and the Central Bank of Chile for helpful comments and suggestions. Sebasti{\'a}n Claro acknowledges the financial support from Fundaci{\'o}n Andes through Grant 14-060-9. This paper does not necessarily reflect the views of the Board of the Central Bank of Chile.",

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PY - 2009

Y1 - 2009

N2 - We use detailed Chilean plant-level data from 1990 to 2000 to study the impact of Chinese import competition in manufacturing industries. We study whether China's imports have been associated with a downsizing of manufacturing plants or whether firms have escaped Chinese competition through changes in output mix, productivity catch-up, or increased exports. Our results show that imports from China have negatively affected employment growth on surviving plants, and increased the probability of exit. In contrast to previous evidence for the United States, we do not find evidence that manufacturing plants have adjusted by producing more sophisticated goods or by exporting.

AB - We use detailed Chilean plant-level data from 1990 to 2000 to study the impact of Chinese import competition in manufacturing industries. We study whether China's imports have been associated with a downsizing of manufacturing plants or whether firms have escaped Chinese competition through changes in output mix, productivity catch-up, or increased exports. Our results show that imports from China have negatively affected employment growth on surviving plants, and increased the probability of exit. In contrast to previous evidence for the United States, we do not find evidence that manufacturing plants have adjusted by producing more sophisticated goods or by exporting.

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David Versus Goliath: The Impact of Chinese Competition on Developing Countries

Abstract

Bibliographical note

Keywords

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