Thursday, 23 October 2008

China's Threat to other Southern Exporters?

There is an ongoing debate on the impact of China on the competitiveness of China's near neighbours and indeed is an area where I have done some work.

The World Economy recently published a paper looking at this threat.

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"Measuring the Competitive Threat from China for Other Southern Exporters"

World Economy, Vol. 31, Issue 10, pp. 1351-1366, October 2008

RHYS JENKINS

LINK HERE.

In recent years there has been a growing literature which analyses the threat which Chinese exports pose to the exports of other developing countries. This paper provides a critique of the standard measures of export similarity which have been used to estimate the threat from China in these studies. Two alternative indices, the Static and the Dynamic Index of Competitive Threat, are developed and estimated for 18 developing countries and compared with estimates for the standard measures. It is shown that the latter tend to underestimate the extent to which countries are threatened by China. They also distort both the rankings of countries according to the extent to which they face competition from China and the direction of change in the competitive threat over time.

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