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Export Variety, Revenue, and Productivity in China
Author(s) -
Chen Bo
Publication year - 2011
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/j.1467-9396.2011.00951.x
Subject(s) - revenue , total factor productivity , productivity , china , economics , variety (cybernetics) , panel data , mainland china , index (typography) , international trade , international economics , monetary economics , econometrics , macroeconomics , finance , artificial intelligence , political science , law , world wide web , computer science
In this paper I argue through empirical testing that it is the underlying export variety that helps to explain the strong correlation between China's provincial export revenue and productivity. The empirical model maps export varieties into provincial GDP functions with multiple sectors by price index theory. By employing panel data that covers all 31 executive districts of mainland China from 1998 to 2005, I find that export varieties, via export revenue, significantly affect productivity: it accounts for 44.1% of interprovincial TFP differences and 36.6% of within‐province TFP growth; a 10% increase in export variety leads to a 1.4% productivity growth in China.