Chinese exports and productivity gains: Panel evidence

Abstract

This paper examines the impact of imports from China on the labour productivity levels of importers, using unbalanced data from 1994 to 2006. It is hypothesised that imports from China increase importer countries' labour productivity levels. Using cross-section, fixed and random-effect models, a statistically significant, positive relationship is found between the share of a country's imports from China and labour productivity in the manufacturing sector of that country. Moreover, it is found that imports from China have a larger impact on China's main Asian-Pacific trade partners and countries with higher manufacturing shares in their total exports. © 2010 The Authors. Journal compilation © 2010 Crawford School of Economics and Government, The Australian National University and Blackwell Publishing Asia Pty Ltd.