2020/22 LEM Working Paper Series

Gains from trade or from catching-up? Value creation and distribution in the era of China’s WTO accession

Giovanni Dosi, Maria Enrica Virgillito and Xiaodan Yu
Export; Wage; Productivity; Trade; Event studies.

  JEL Classifications
L6, F16, D24, J31
In this article we focus on the role of exports in Chinese economic development in the era of WTO accession. We address a series of different, although connected, questions. First, do Chinese exporting and non-exporting firms differ in terms of their productivity performance and paid wages? Second, to what extent exporting and non-exporting firms have contributed to the process of convergence and catching-up? Third, does the productivity-wage pass-through differ between exporting and non-exporting firms? Overall our findings downplay the role of exporting firms as both carriers of labour productivity and wage growth for the Chinese economy. In this respect, ''gains from catching-up'' outweigh any ''gain from trade''.
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