Alexander Hammer (汉力山)

This paper describes the paradox of China’s current condition as a high-tech, lowproductivity economy. It does so by identifying the means, accomplishments, and challenges associated with China’s rapid innovation drive, while showing that its scientific advances have yet to yield the productivity gains that motivated its official initiatives. The push to deepen national technological capabilities gained considerable traction in the past 15 years through China’s landmark “Medium- and Long-Term… Show more

This paper describes the paradox of China’s current condition as a high-tech, lowproductivity economy. It does so by identifying the means, accomplishments, and challenges associated with China’s rapid innovation drive, while showing that its scientific advances have yet to yield the productivity gains that motivated its official initiatives. The push to deepen national technological capabilities gained considerable traction in the past 15 years through China’s landmark “Medium- and Long-Term Program for Science and Technology Development,” “Made in China 2025,” and “13th Five-Year Science and Technological Innovation” plans. These policy initiatives were reinforced by unprecedented amounts of R&D spending and acquisitions of foreign technology through legal and sometimes controversial means (e.g., intellectual property misappropriation). Through these mechanisms, Chinese firms have had an uneven record in reaching the high-tech frontier. While in some areas (e.g., machine learning, 5G technology, fintech) its firms’ high R&D expenditures have translated into pathbreaking technological advances, they largely lag behind in other core technologies (e.g., semiconductors/integrated circuits, airplanes, and advanced airplane turbofan engines). Chinese firms that have been successful with disruptive technologies, moreover, have had their impact felt on a global stage, as they are accounting for a progressively larger share of worldwide patent applications, scientific papers, and high-tech manufacturing. After describing these developments, this paper provides possible explanations for why total factor productivity growth has remained largely elusive despite China’s rapid technological advances. Show less

The U.S.-China merchandise trade balance vis-à-vis China has been a perennial
source of debate for decades. This paper aims to add context to that debate, by
describing unique attributes of the U.S.-China merchandise trade relationship. To do
so, it uses a specialized dataset from the General Administration of Customs of the
People’s Republic of China (China Customs) in the 1995-2017 period to uncover
important trends. With respect to ownership characteristics, we have found… Show more

The U.S.-China merchandise trade balance vis-à-vis China has been a perennial
source of debate for decades. This paper aims to add context to that debate, by
describing unique attributes of the U.S.-China merchandise trade relationship. To do
so, it uses a specialized dataset from the General Administration of Customs of the
People’s Republic of China (China Customs) in the 1995-2017 period to uncover
important trends. With respect to ownership characteristics, we have found that
foreign-invested enterprises (FIEs) have played a disproportionately large role in
China’s trade with the United States relative to China’s trade with other considered
regions (e.g., Europe, Asia, Latin America, Africa). This is explained by high
concentrations of FIEs along global value chains that are conducting business in both
countries. Also, China’s state-owned enterprises (SOEs) have played a less dominant
role in China’s trade with the United States relative to China’s trade with the rest of
the world, especially in comparison to Africa and Latin America where Chinese SOEs
have been importing large quantities of primary commodities. With respect to customs
regime characteristics, we found high concentrations of processing trade patterns
with respect to China’s trade with the United States, Europe, and Asia. China’s
imports from Asia, however, are not only larger than those from the U.S. or any other
region but are characterized by unusually high concentrations of intermediary inputs
that are used for further assembly and re-exportation once processed in China. We
have also found that Asian FIE’s entryway into China has been largely through
Chinese export processing zones which are prominent with respect to China-U.S. and
China-EU trade, but not nearly to the same extent. Show less

China’s Belt and Road Initiative (BRI) is considered by some to be the largest infrastructure project in history, far surpassing the inflation-adjusted size of the U.S. Marshall Plan and other well-known infrastructure projects. 1 Official details of the size and scope of the BRI remain broadly undefined, however, and estimates by researchers have varied widely from $272 billion to $8 trillion. These studies measured different aspects of the BRI, which have ranged from overseas foreign direct… Show more

China’s Belt and Road Initiative (BRI) is considered by some to be the largest infrastructure project in history, far surpassing the inflation-adjusted size of the U.S. Marshall Plan and other well-known infrastructure projects. 1 Official details of the size and scope of the BRI remain broadly undefined, however, and estimates by researchers have varied widely from $272 billion to $8 trillion. These studies measured different aspects of the BRI, which have ranged from overseas foreign direct investment (OFDI), to exports, loans, grants, infrastructure development, construction services, and combinations. Even when estimates used comparable concepts, such as OFDI, they often used official data which reflects declared, not realzed, values. Finally, the studies also considered different sets of BRI member countries, and have been hampered by round-tripping problems (which returns OFDI to the donor country) and distortions from temporary offshoring to tax havens. To advance our understanding of the size and composition of China’s BRI, we focus on the largest outlay, OFDI, and aggregate transaction data collected from the American Enterprise Institute’s GIT database to circumvent data limitations. We also standardize membership to include all countries with signed BRI-related Memoranda of Understanding with China. We find that China’s incremental OFDI spending to BRI countries amounted to $235 billion since 2014.2 Also, most OFDI went to Asian transport and energy sectors, and the largest country-sector investments have been in Pakistan and Russia’s energy sectors, and Nigeria’s transportation sector Show less

Economic theory suggests that innovation and productivity are inextricably linked. The intuition, backed by empirical evidence and typically restricted to goods production, suggests that the more a country innovates and commercializes new technology, the more efficiently it will use its resources to produce its goods. This briefing describes China’s puzzling developments in this regard. Although conventional indicators (e.g., R&D expenditures, patent filings, global innovation rankings) suggest… Show more

Economic theory suggests that innovation and productivity are inextricably linked. The intuition, backed by empirical evidence and typically restricted to goods production, suggests that the more a country innovates and commercializes new technology, the more efficiently it will use its resources to produce its goods. This briefing describes China’s puzzling developments in this regard. Although conventional indicators (e.g., R&D expenditures, patent filings, global innovation rankings) suggest that China is innovating rapidly, total factor productivity suggest that China’s productivity growth has been sluggish―especially since the 2008-09 global financial crisis. In this briefing, we showcase these diverging trends using empirical analysis and information collected from the literature, and find that traditional indicators may be overestimating China’s growth in innovation. This may be attributable to the poor quality of filed patents, the government-directed nature of lending and R&D spending, and China’s broad misallocation of capital, especially since the financial crisis. Show less

U.S. soybean farmers have faced multiple headwinds since 2018, given slowing global demand, rising stock levels, and lower prices for their commodity. As exports to their largest market, China, dropped by 75% (y/y) in 2018 amidst rising trade tensions, U.S. soy farmers have sought new ways to stay competitive. This has included participating in new U.S. government aid programs, slashing prices, and finding new markets. Even if trade tensions subside, it has been observed that (1) pricing is not… Show more

U.S. soybean farmers have faced multiple headwinds since 2018, given slowing global demand, rising stock levels, and lower prices for their commodity. As exports to their largest market, China, dropped by 75% (y/y) in 2018 amidst rising trade tensions, U.S. soy farmers have sought new ways to stay competitive. This has included participating in new U.S. government aid programs, slashing prices, and finding new markets. Even if trade tensions subside, it has been observed that (1) pricing is not the only determinant of competitiveness in China’s market; (2) alternative suppliers (e.g., from Brazil) can serve as at least temporary substitutes; and (3) China’s state‐owned enterprises are highly responsive to their government’s changing positions on soy. Show less

This briefing summarizes the origin, rise, and implications of China’s persistent domestic debt problem. With its $588 billion economic stimulus package during the 2008-09 global financial crisis, China’s government attempted to shore-up domestic infrastructure investment and offset the effects of diminishing global demand for its exports. To do so, Chinese authorities made new capital available and relaxed borrowing requirements for many local firms, most of which were state-owned enterprises… Show more

This briefing summarizes the origin, rise, and implications of China’s persistent domestic debt problem. With its $588 billion economic stimulus package during the 2008-09 global financial crisis, China’s government attempted to shore-up domestic infrastructure investment and offset the effects of diminishing global demand for its exports. To do so, Chinese authorities made new capital available and relaxed borrowing requirements for many local firms, most of which were state-owned enterprises (SOEs). These SOEs did not use the newly borrowed capital as efficiently as their private sector counterparts, resulting in overinvestment (e.g., steel and aluminum sectors), low investment returns, and frequent defaults. This misallocation of capital and surging debt in 2009-16 increased China’s financial risk exposure and inhibited China’s economic growth potential, as funds were increasingly diverted from new investment to debt servicing. Through strict policy measures, Chinese authorities have arrested the growth of debt in 2017, lowering China’s high financial risk exposure. However, the persistently large stock of corporate (and now household) debt is still likely to inhibit China’s long-term economic growth and affect U.S. firms. Show less

China’s external sector has been the engine behind the country’s robust economic growth over the past four decades. By 2016, China’s total merchandise trade accounted for 16.1% of the world total, compared to 0.6% in 1978 when its economic reforms were initiated. China’s rapid trade growth was attributable to a series of interrelated factors. This briefing focuses on one of those factors—China’s declining dependence on state- owned enterprises (SOEs) in much, but not all, of its trade activity.… Show more

China’s external sector has been the engine behind the country’s robust economic growth over the past four decades. By 2016, China’s total merchandise trade accounted for 16.1% of the world total, compared to 0.6% in 1978 when its economic reforms were initiated. China’s rapid trade growth was attributable to a series of interrelated factors. This briefing focuses on one of those factors—China’s declining dependence on state- owned enterprises (SOEs) in much, but not all, of its trade activity. Using the latest data, and starting from 1995 when official trade statistics became more reliable, this briefing (a) describes SOEs’ declining influence in China’s trade and (b) highlights prominent sectoral exceptions where Chinese SOEs still affect global market conditions. Show less

In May 2015, China implemented a “Made in China 2025” initiative to upgrade its manufacturing sector into one that will be considerably more innovative and competitive. Much state direction and funding have been provided to help move the country from a “Made in China” to a “Created in China” economy. This briefing describes the goals of this new initiative (in light of similar past policies), its motivation, and its targeted sectors. It also outlines China’s implementation plans and identifies… Show more

In May 2015, China implemented a “Made in China 2025” initiative to upgrade its manufacturing sector into one that will be considerably more innovative and competitive. Much state direction and funding have been provided to help move the country from a “Made in China” to a “Created in China” economy. This briefing describes the goals of this new initiative (in light of similar past policies), its motivation, and its targeted sectors. It also outlines China’s implementation plans and identifies potential implications for U.S firms. Show less

This briefing is part of a continuing Executive Briefing on Trade (EBOT) series on U.S. manufacturing offshoring and examines what is known about the size and composition of U.S. offshoring activity to China. An accompanying EBOT described incentives U.S. firms have had to offshore production to China, the world’s largest manufacturing economy. These incentives have included cost advantages, scalability options, policy mechanisms, and strategic interests (e.g., securing access to inputs and… Show more

This briefing is part of a continuing Executive Briefing on Trade (EBOT) series on U.S. manufacturing offshoring and examines what is known about the size and composition of U.S. offshoring activity to China. An accompanying EBOT described incentives U.S. firms have had to offshore production to China, the world’s largest manufacturing economy. These incentives have included cost advantages, scalability options, policy mechanisms, and strategic interests (e.g., securing access to inputs and proximity to fastest-growing consumer base). This briefing builds upon those findings, by showing that U.S.-based multinationals have been heavily involved in China’s manufacturing revolution. The latest data suggest that U.S. affiliates employed more than 1.7 million workers in China in 2014, nearly half of which were in China’s manufacturing sector (e.g., semiconductor firms). It also shows that U.S. firms have invested heavily in their Chinese affiliates’ operations, and that as of 2014, U.S. parents’ affiliates in China sold more to the local market than U.S. affiliates in Japan, Mexico, and India, combined. Show less

This briefing represents the first in a series of EBOTs on U.S. manufacturing offshoring. It describes why many U.S. firms have relocated production networks to China, the world’s largest manufacturing economy. As the U.S. economy has become increasingly dependent on the provision of services and the production of high-tech goods, many U.S. firms have offshored labor-intensive stages of their manufacturing process to China to benefit from cost differentials, operational advantages, better… Show more

This briefing represents the first in a series of EBOTs on U.S. manufacturing offshoring. It describes why many U.S. firms have relocated production networks to China, the world’s largest manufacturing economy. As the U.S. economy has become increasingly dependent on the provision of services and the production of high-tech goods, many U.S. firms have offshored labor-intensive stages of their manufacturing process to China to benefit from cost differentials, operational advantages, better proximity to suppliers and a growing consumer base, and incentives. An accompanying briefing describes the size and composition of U.S. manufacturing offshoring to China Show less

Recent research has examined trade statistics from a value-added perspective and it has traced global value chains (GVC) through countries’ domestic production, exports and imports. Research by Koopman et al., Johnson and Noguera, Timmer, and OECD-WTO has made clear that our understanding of trade linkages based on statistics in gross values can be very different from our understanding of trade based on value-added terms. This paper discusses the potential implications for the U.S. economy and… Show more

Recent research has examined trade statistics from a value-added perspective and it has traced global value chains (GVC) through countries’ domestic production, exports and imports. Research by Koopman et al., Johnson and Noguera, Timmer, and OECD-WTO has made clear that our understanding of trade linkages based on statistics in gross values can be very different from our understanding of trade based on value-added terms. This paper discusses the potential implications for the U.S. economy and its trade arising from China’s efforts to rebalance its economy and promote consumption-led growth. Our analytical framework is a multiregional computable general equilibrium (CGE) trade model. The model is calibrated to a global data set derived from version 8 of the GTAP database (Narayanan, Aguiar, and McDougall, 2012). This data set has additional information about the sourcing of imports obtained from a global value chains data (Tsigas, Wang, and Gehlhar, 2012). The model has a focus on the United States, China, and their top trade partners. Twenty six regions and 41 production sectors in each region are specified to represent the world economy. The presentation in the GTAP Conference would focus on the additional insights obtained from including the GVC information in the analysis. Show less

This research note documents the methodology of U.S.-China-Hong Kong triangular merchandise trade statistic reconciliation. Instead of directly comparing the official trade statistics from the United States and China and calculating the discrepancies, the U.S-China-Hong Kong triangular reconciliation methodology takes into account of re-exports and transshipment via Hong Kong. This research note also documents the application of this methodology to advance technology product trade between the… Show more

This research note documents the methodology of U.S.-China-Hong Kong triangular merchandise trade statistic reconciliation. Instead of directly comparing the official trade statistics from the United States and China and calculating the discrepancies, the U.S-China-Hong Kong triangular reconciliation methodology takes into account of re-exports and transshipment via Hong Kong. This research note also documents the application of this methodology to advance technology product trade between the United States and China. Show less

U.S. exporters have choices when it comes to determining in which markets to sell their firms’ products and services. These choices depend on several factors, including market size, income levels, price sensitivity, competition, consumer preferences, and other demand conditions in the recipient markets. Cost considerations also play an important role in determining to which markets firms export, especially those associated with transportation, tariff and non-tariff barriers to trade, legal and… Show more

U.S. exporters have choices when it comes to determining in which markets to sell their firms’ products and services. These choices depend on several factors, including market size, income levels, price sensitivity, competition, consumer preferences, and other demand conditions in the recipient markets. Cost considerations also play an important role in determining to which markets firms export, especially those associated with transportation, tariff and non-tariff barriers to trade, legal and translations services, and logistics support for vertically integrated supply and distribution channels. However, the inclusion of intellectual property rights (IPR) considerations has not been integral to the well-established literature on firms’ export determinants. Using a comparative indicator of IPR protection measures in various countries, this article isolates the effects of IPR protection as a determinant to U.S. export activity. The results show that growth in U.S. exports has been correlated with improvements in IPR protection in foreign markets over the considered period and that the magnitude of this correlation has varied markedly by sector and country. High-technology sectors, such as semiconductors as well as synthetic rubbers and fibers, exhibited the greatest sensitivity to improvements in IPR protection mechanisms in the considered period while improvements in IPR protection in markets like Mexico, China, and Japan were correlated with disproportionately high positive effects on U.S. export performance. Show less

China’s trade and investment relationship with Africa is important to both trading partners. For China, Africa represents a growing source of raw materials –most importantly crude oil, iron ore/concentrates, and copper-- which have helped fuel China’s rapid infrastructure development. For Africa, China represents a major trading partner and investor that provides it with cheap consumer products, buys its natural resources, and helps build its infrastructure. This briefing describes China’s… Show more

China’s trade and investment relationship with Africa is important to both trading partners. For China, Africa represents a growing source of raw materials –most importantly crude oil, iron ore/concentrates, and copper-- which have helped fuel China’s rapid infrastructure development. For Africa, China represents a major trading partner and investor that provides it with cheap consumer products, buys its natural resources, and helps build its infrastructure. This briefing describes China’s trade and investment in Africa’s major raw material markets, and addresses the roles that Chinese state-owned enterprises (SOEs) and special economic zones have played in this relationship. This bilateral trade relationship is relevant to U.S. firms, as changing Chinese demand and supply conditions can impact global commodity prices and competitive conditions for U.S. firms operating in Africa. Show less

China is now the world’s largest consumer and producer of copper. Its demand for the commodity has soared in tandem with the country’s industrialization process, given copper’s extensive use in infrastructure (e.g., plumbing, telecommunication wiring, and building materials) and manufacturing equipment (e.g., electric power generation and transmission equipment). To meet its growing copper demand over the last decade, China has imported increasing amounts of copper ores (mostly from Latin… Show more

China is now the world’s largest consumer and producer of copper. Its demand for the commodity has soared in tandem with the country’s industrialization process, given copper’s extensive use in infrastructure (e.g., plumbing, telecommunication wiring, and building materials) and manufacturing equipment (e.g., electric power generation and transmission equipment). To meet its growing copper demand over the last decade, China has imported increasing amounts of copper ores (mostly from Latin America) and copper waste/scrap (mostly from the United States) for domestic processing, which is either locally consumed or re-exported. Given China’s dominance as both a global consumer and supplier of copper, changes in China’s domestic market conditions can markedly influence copper’s world price – as evidenced by the commodity’s recent price decreases that were triggered by deteriorating Chinese property market conditions. Understanding China’s role on global copper markets is relevant for U.S. firms, since the United States is the world’s largest supplier of copper waste/scrap, and copper waste/scrap now represents the United States’ third-largest export to China. Show less

China’s position as the world’s second largest recipient of foreign direct investment (FDI) has been well documented. However, it is less well known that China has recently become an important supplier of global FDI. This briefing describes what is known about the magnitude and composition of China’s outward foreign direct investment (OFDI). Official data show that China’s OFDI is large (relative to that of most countries), growing, and is mostly comprised of investments directed towards the… Show more

China’s position as the world’s second largest recipient of foreign direct investment (FDI) has been well documented. However, it is less well known that China has recently become an important supplier of global FDI. This briefing describes what is known about the magnitude and composition of China’s outward foreign direct investment (OFDI). Official data show that China’s OFDI is large (relative to that of most countries), growing, and is mostly comprised of investments directed towards the financial sectors of Hong Kong, the Cayman Islands, the British Virgin Islands, and Luxembourg. Since much of China’s OFDI is eventually redirected back to China and other markets, it is difficult to isolate the magnitude and composition of its true outbound investment. Firm-level data provide clearer insight. That data suggests that Chinese OFDI may be higher than what has been reported, and that its investments have mostly been directed towards the building of new facilities in primary commodity sectors (e.g.,oil, coal, metals) in Asia, Latin America & the Caribbean, and Africa. The findings are relevant to the United States, since China’s OFDI –most of which is conducted by state-owned enterprises– is likely to add competitive pressure to U.S.-based multinational firms operating in similar markets Show less

China’s rapid economic transformation over the past three decades has presented both opportunities and challenges to many U.S. businesses. Despite broad success in the China market, many U.S. companies have reported that two major factors—the infringement of their intellectual property rights (IPR) in China and China’s indigenous innovation policies—have undermined their competitive positions. In response to a U.S. International Trade Commission (Commission) survey, many U.S. firms reported… Show more

China’s rapid economic transformation over the past three decades has presented both opportunities and challenges to many U.S. businesses. Despite broad success in the China market, many U.S. companies have reported that two major factors—the infringement of their intellectual property rights (IPR) in China and China’s indigenous innovation policies—have undermined their competitive positions. In response to a U.S. International Trade Commission (Commission) survey, many U.S. firms reported losses associated with IPR infringement in China, including losses in sales, profits, and license and royalty fees, as well as damage to brand names and product reputation. U.S. firms have reported losses associated with China’s indigenous innovation policies as well, but have been mostly concerned about the future implications of these evolving policies in such areas as technical standards and preferential support to Chinese firms. In this second of two interconnected reports requested by the U.S. Senate Committee on Finance, the Commission was asked to estimate the effect of reported IPR infringement in China and China’s indigenous innovation policies on the U.S. economy and employment, to the extent feasible. This report provides such estimates, on both an economy-wide and sectoral basis, using a combination of analytic tools and qualitative information.
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This volume presents a series of papers prepared by U.S. and Chinese researchers examining the development of trade between the United States and China in advanced technology products (ATPs) at the Joint Symposium on U.S.-China Advanced Technology Trade and Industrial Development, October 23-24, 2009, in Beijing, China. The symposium was organized by the United States International Trade Commission, the School of Public Policy and Management at Tsinghua University, the Institute for… Show more

This volume presents a series of papers prepared by U.S. and Chinese researchers examining the development of trade between the United States and China in advanced technology products (ATPs) at the Joint Symposium on U.S.-China Advanced Technology Trade and Industrial Development, October 23-24, 2009, in Beijing, China. The symposium was organized by the United States International Trade Commission, the School of Public Policy and Management at Tsinghua University, the Institute for International Economic Research at the National Development and Reform Commission, and the Brookings-Tsinghua Center for Public Policy at Tsinghua University. The goal of the research efforts presented at the symposium was to better understand the factors affecting U.S.-China ATP trade and the rapid growth of China as a platform for ATP production and trade. Show less

Intellectual property rights (IPR) infringement in China reduces market opportunities and undermines the profitability of U.S. firms when sales of products and technologies are undercut by competition from illegal, lower-cost imitations. Intellectual property (IP) is often the most valuable asset that a company holds, but many companies, particularly smaller ones, lack the resources and expertise necessary to protect their IP in China. “Indigenous innovation” policies, which promote the… Show more

Intellectual property rights (IPR) infringement in China reduces market opportunities and undermines the profitability of U.S. firms when sales of products and technologies are undercut by competition from illegal, lower-cost imitations. Intellectual property (IP) is often the most valuable asset that a company holds, but many companies, particularly smaller ones, lack the resources and expertise necessary to protect their IP in China. “Indigenous innovation” policies, which promote the development, commercialization, and purchase of Chinese products and technologies, may also be disadvantaging U.S. and other foreign firms and creating new barriers to foreign direct investment (FDI) and exports to China.

China’s World Trade Organization (WTO) accession in 2001 marked a milestone in the country’s integration in the global economy. China has developed into one of the world’s most important growth markets and is now the second-largest U.S. trading partner (after Canada). As one important aspect of WTO accession, China committed to complying with the requirements of the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement. However, IPR infringement in China—including violations of copyrights, trademarks, patents, and trade secrets—remains a central area of U.S. concern in the bilateral trade relationship.

This is the first of two reports requested by the U.S. Senate Committee on Finance (Committee) on the effects of IPR infringement and indigenous innovation policies in China on U.S. jobs and the U.S. economy. In this report, the U.S. International Trade Commission (Commission or USITC) was requested to describe the principal types of reported IPR infringement in China, describe Chinese indigenous innovation policies, and outline an analytic framework for determining the effects of both IPR infringement and indigenous innovation policies on the U.S. economy. Show less

This report describes characteristics of domestic small and medium-sized enterprises (SMEs) and the role they play in U.S. exports. Within the U.S. economy, SMEs account for the vast majority of firms and approximately half the gross domestic product (GDP) generated by nonagricultural sectors. However, SMEs accounted for only about 30 percent of merchandise exports between 1997 and 2007. As was the case for larger firms, SME merchandise goods were primarily exported to Canada and Mexico in… Show more

This report describes characteristics of domestic small and medium-sized enterprises (SMEs) and the role they play in U.S. exports. Within the U.S. economy, SMEs account for the vast majority of firms and approximately half the gross domestic product (GDP) generated by nonagricultural sectors. However, SMEs accounted for only about 30 percent of merchandise exports between 1997 and 2007. As was the case for larger firms, SME merchandise goods were primarily exported to Canada and Mexico in 2007, and SME principal exports were computer and electronic products, machinery, and chemicals. Unlike larger firms, SMEs tended to concentrate their merchandise exports in highincome destination markets such as Hong Kong, Israel, and Switzerland, and in laborintensive product categories such as wood products and apparel and accessories. Moreover, relative to larger firms, growth in the value of SME exports was more dependent upon net new market entrants, particularly among the smallest SMEs. While services export data for SMEs are largely unavailable, data on the location of affiliates for two services industries––(1) finance and insurance and (2) professional, scientific, and technical services––suggest that the United Kingdom and Canada are likely to have been important export destinations for SME firms in these industries in recent years. Show less

This briefing provides an overview of the magnitude and composition of Chinese exports of advanced technology products (ATPs) to the U.S., and shows how such exports are differentiated from Chinese ATP exports to the rest of the world (ROW). It demonstrates that Chinese ATP exports to the United States have expanded rapidly in recent years, becoming increasingly concentrated in consumer electronics –a category which include computers, TVs, telephones, printers/monitors, and cameras. An… Show more

This briefing provides an overview of the magnitude and composition of Chinese exports of advanced technology products (ATPs) to the U.S., and shows how such exports are differentiated from Chinese ATP exports to the rest of the world (ROW). It demonstrates that Chinese ATP exports to the United States have expanded rapidly in recent years, becoming increasingly concentrated in consumer electronics –a category which include computers, TVs, telephones, printers/monitors, and cameras. An accompanying briefing on U.S. ATP exports to China provides complementary findings, by imposing similar ATP definitions on U.S. trade data. Show less

This briefing provides an overview of the magnitude and composition of recent U.S. exports of advanced technology products (ATPs) to China, and shows how such exports are differentiated from U.S. ATP exports to the rest of the world (ROW). It demonstrates that U.S. ATP exports to China have expanded rapidly in recent years, becoming increasingly concentrated in electronic products (e.g., semiconductors), intended for integration into Chinese manufacturing supply lines. An accompanying briefing… Show more

This briefing provides an overview of the magnitude and composition of recent U.S. exports of advanced technology products (ATPs) to China, and shows how such exports are differentiated from U.S. ATP exports to the rest of the world (ROW). It demonstrates that U.S. ATP exports to China have expanded rapidly in recent years, becoming increasingly concentrated in electronic products (e.g., semiconductors), intended for integration into Chinese manufacturing supply lines. An accompanying briefing on Chinese ATP exports to the United States provides complementary findings, by applying similar ATP definitions to Chinese export data. Show less

This briefing highlights the United States’ recent trade position with some of the world’s fastest growing emerging markets: Brazil, Russia, India, and China (the “BRIC” countries). It adds context to the first BRIC summit that took place in June 2009 in Russia, and demonstrates how BRIC partners have maintained different trade relationships with the United States ─often reflecting their different development paths. Specifically, Brazil’s export concentration in primary products (e.g., oil… Show more

This briefing highlights the United States’ recent trade position with some of the world’s fastest growing emerging markets: Brazil, Russia, India, and China (the “BRIC” countries). It adds context to the first BRIC summit that took place in June 2009 in Russia, and demonstrates how BRIC partners have maintained different trade relationships with the United States ─often reflecting their different development paths. Specifically, Brazil’s export concentration in primary products (e.g., oil, iron ore, soybeans) and certain manufacturing sectors (e.g., aircraft), Russia’s export concentration in oil products, India’s export concentration in services, and China’s export concentration in manufactured goods, have, in varying degrees, been reflected in their respective bilateral trade relationships with the United States. Show less

Global demand for manufactured goods has fallen in the wake of the world-wide financial crisis and ensuing G-7 consumption slowdown. This drop in demand has pushed China’s economy to the brink of a “growth recession” –conventionally defined as a period of weak economic growth and rising unemployment. To combat this, China’s government has utilized a combination of policy tools aimed at:

• Fiscal: Promoting domestic investment through public infrastructure development;
• Monetary:… Show more

Global demand for manufactured goods has fallen in the wake of the world-wide financial crisis and ensuing G-7 consumption slowdown. This drop in demand has pushed China’s economy to the brink of a “growth recession” –conventionally defined as a period of weak economic growth and rising unemployment. To combat this, China’s government has utilized a combination of policy tools aimed at:

• Fiscal: Promoting domestic investment through public infrastructure development;
• Monetary: Loosening credit, particularly to state-owned enterprises; and
• Other: Extending export rebates and incentivizing real estate transactions.

There are several indications of an economic slowdown in China (see figures below). Recent reports of labor market penetration problems and plant closings in thousands of textile, apparel, hardware, and electronics firms, suggest that urban unemployment may rise above last official estimates of 4.2% Show less

This is the first in a series of three reports by the U.S. International Trade Commission (the Commission) on U.S.–China trade requested by the Committee on Ways and Means (the Committee) of the U.S. House of Representatives. The Committee requested that this first study describe the practices and policies that China’s central, provincial, and local government bodies use to support and attempt to influence decision making in the economy, including the manufacturing, agricultural, and services… Show more

This is the first in a series of three reports by the U.S. International Trade Commission (the Commission) on U.S.–China trade requested by the Committee on Ways and Means (the Committee) of the U.S. House of Representatives. The Committee requested that this first study describe the practices and policies that China’s central, provincial, and local government bodies use to support and attempt to influence decision making in the economy, including the manufacturing, agricultural, and services sectors; the second study is to assess, to the extent possible, the relative impact of these policies on selected sectors; and the third study is to examine the role of these policies in influencing patterns of production and investment in the Asian region. Show less

This study examines competitive conditions, including regulatory conditions, affecting U.S. sales and trade of medical devices in Japan and other principal foreign markets during 2001–5. An examination of regulatory cost and approval data by the U.S. International Trade Commission suggests that average total approval times for new medical devices were higher in Japan during the period than in other principal global markets, including the United States and the European Union (EU). Despite… Show more

This study examines competitive conditions, including regulatory conditions, affecting U.S. sales and trade of medical devices in Japan and other principal foreign markets during 2001–5. An examination of regulatory cost and approval data by the U.S. International Trade Commission suggests that average total approval times for new medical devices were higher in Japan during the period than in other principal global markets, including the United States and the European Union (EU). Despite Japan’s limited success in reducing these times in 2005 after reforms to Japan's Pharmaceutical Affairs Law took effect, significant challenges remain. Innovative, advanced technology medical devices are the most adversely affected by the Japanese regulatory process. U.S. medical device firms are the leading developers and exporters of such products and may be disproportionately affected. Medical device firms generally prefer the EU medical device approval system over the U.S. and Japanese approval systems, due to its shorter approval times. Although medical device regulation in the United States remains tightly controlled, it has become more predictable in recent years, and review times have steadily declined. Show less

This paper examines significant China-Latin America trade patterns that have emerged between 1999 and 2005, and assesses implications of these developments on these trading partners’ future economic relationship. We show that China’s iron, copper, and soybean imports from Latin America have become increasingly concentrated; that China and Latin America are rapidly becoming interconnected on telecommunications and computer manufacturing supply chains, with China supplying parts for assembly in… Show more

This paper examines significant China-Latin America trade patterns that have emerged between 1999 and 2005, and assesses implications of these developments on these trading partners’ future economic relationship. We show that China’s iron, copper, and soybean imports from Latin America have become increasingly concentrated; that China and Latin America are rapidly becoming interconnected on telecommunications and computer manufacturing supply chains, with China supplying parts for assembly in Latin America; and that Chinese-made electronic and textile consumer goods have rapidly penetrated Latin American markets. The implications of our findings suggest that while there are many benefits of deeper economic integration to both sides, the vulnerabilities are likely to be predominantly borne by China’s Latin American trading partners. Show less

The aim of this paper is to identify structural developments in China’s external sector that have significantly influenced that country’s large and growing merchandise trade surplus vis-a-vis the United States. To reach its objective, this paper will decompose U.S.-China trade flows according to a series of independent and interdependent criteria, using highly disaggregated 1995-2004 customs data that the U.S. International Trade Commission (USITC) recently acquired from official sources in… Show more

The aim of this paper is to identify structural developments in China’s external sector that have significantly influenced that country’s large and growing merchandise trade surplus vis-a-vis the United States. To reach its objective, this paper will decompose U.S.-China trade flows according to a series of independent and interdependent criteria, using highly disaggregated 1995-2004 customs data that the U.S. International Trade Commission (USITC) recently acquired from official sources in China. Show less

The aim of this paper is to develop an analytic representation of Chinese labor productivity as a function of various classic and newly considered parameters. Its econometrics‐based approach uses an elaborated version of the Cobb‐Douglas production function, and includes both classic parameters (capital/labor ratio, average firm size, time) and new ones (proportion of output produced by enterprises of various types of ownership, geographic location)characteristic of the Chinese transition… Show more

The aim of this paper is to develop an analytic representation of Chinese labor productivity as a function of various classic and newly considered parameters. Its econometrics‐based approach uses an elaborated version of the Cobb‐Douglas production function, and includes both classic parameters (capital/labor ratio, average firm size, time) and new ones (proportion of output produced by enterprises of various types of ownership, geographic location)characteristic of the Chinese transition process. The application of regression analysis to data collected from the Chinese Statistical Bureau for a period of ten years (1985‐1994)resulted in five representative models of the Chinese economy; one for the entire country, and one for each of its four encompassing regions. Show less

Using data published by the Chinese Statistical Bureau, an elaborated version of theCobb‐Douglas production function was developed in [3] to express the dependence that industrial production has on classic economic factors, ownership‐related variables and geographic location. In this paper, we reexamine the same data using the new Boolean‐based methodology of Logical Analysis of Data (LAD). The LAD models detect numerous characteristic patterns for explaining changes in productivity, strongly… Show more

Using data published by the Chinese Statistical Bureau, an elaborated version of theCobb‐Douglas production function was developed in [3] to express the dependence that industrial production has on classic economic factors, ownership‐related variables and geographic location. In this paper, we reexamine the same data using the new Boolean‐based methodology of Logical Analysis of Data (LAD). The LAD models detect numerous characteristic patterns for explaining changes in productivity, strongly confirm and complement the conclusions of [3], and lead to a decision support system aimed at increasing productivity in China's provinces. Show less

Since the initiation of its economic reforms in 1978, China has undergone both a rapid development in its industrial production and a major structural change in its economy, resulting in a decline in the share of output being produced by state-owned enterprises (SOEs). These two simultaneous events appear related to one another. Specifically, it is postulated that the remarkable growth exhibited by the non-state sector seem to be the driving force behind this emerging economy. This paper… Show more

Since the initiation of its economic reforms in 1978, China has undergone both a rapid development in its industrial production and a major structural change in its economy, resulting in a decline in the share of output being produced by state-owned enterprises (SOEs). These two simultaneous events appear related to one another. Specifically, it is postulated that the remarkable growth exhibited by the non-state sector seem to be the driving force behind this emerging economy. This paper attempts to explain what has been at the root of the productivity growth disparities between state and non-state enterprises. The first part of this study presents some background for understanding the Chinese economy and its reform process. Part II considers certain technical, intuitional, and other reasons why SOEs could be relatively slower to develop. It concludes that specific differences between the state and non-state enterprises’ institutional features may explain this disparity. It also considers the notion that the nonstate sector's productivity growth rate could be somewhat exaggerated, due to its "catchup to the technologically sophisticated SOEs in some sectors, and its neglect for product quality. By using an elaborated version of the Cobb-Douglas production function, Part III of this study tests whether these disparities in productivity growth are simply due to differences in efficiency. Due to the fairly conclusive evident which shall be presented, this theory appears to be confirmed. Show less