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Article
Publication date: 1 February 2013

Yan Zhou, Jiadong Tong and Puyang Sun

The purpose of this paper is to examine the effects of gravity variables and trade costs on China's export margins.

Abstract

Purpose

The purpose of this paper is to examine the effects of gravity variables and trade costs on China's export margins.

Design/methodology/approach

Following the structural gravity model with firm heterogeneity, the paper measures the extensive margins and intensive margins of China's export across 46 export destinations and estimates the linkage between export margins and its potential determinants.

Findings

The empirical results confirm the gravity relationship hold for bilateral trade and export margins. Furthermore, trade costs have different influence on extensive margins and intensive margins as the structural gravity model with firm heterogeneity expected. The paper also shows the rapid growth of China's export is mainly along the intensive margins which are increasing in fixed cost for export.

Originality/value

The paper contributes to the measurements of China's export margins and the empirical research on effects of trade liberalization on China's foreign trade.

Details

Journal of Chinese Economic and Foreign Trade Studies, vol. 6 no. 1
Type: Research Article
ISSN: 1754-4408

Keywords

Article
Publication date: 28 January 2014

Dongwen Tian, Rui Li, Wei Yao and Li Huang

The purpose of this paper is to study whether, of China's food and agriculture (agri-food) export, the trade relationships along the extensive margin can transform into short-term…

Abstract

Purpose

The purpose of this paper is to study whether, of China's food and agriculture (agri-food) export, the trade relationships along the extensive margin can transform into short-term ones, and further convert into long-term ones along the intensive margin with survival and maintenance, especially, under what kind of conditions these transformation realize successfully, and what the factors are and how they impact on the length of the trade relationships duration.

Design/methodology/approach

The paper comprises three stages: decomposing China's agricultural export data (1999-2008) into highly disaggregated three distinct parts; with the Kaplan-Meier (KM) nonparametric estimation, discovering the practical source of stable and long-term export growth, and the threshold at which the short-run trade relationships deriving from newly established ones convert into long-run ones successfully; by semi parametric estimation through Cox proportional hazard model, preliminarily examining the possible impact of different factors on the trade relationship's hazard rate and duration.

Findings

The paper reveals that China agri-food trade pattern at the product level is surprisingly dynamic with newly established trade relations being more likely to fail. While the frequent volatilities of short-term relations at the extensive margin could be used to evaluate the source of short-term export growth especially and effectively, the pattern of negative dependence together with the threshold effect of duration indicates, only when these short-term relations live longer than four years will they substantially contribute to a stable and prolonged export growth. Simultaneously, trade duration significantly correlates to importing country's development status, region it belongs to, product processing degree, export experience and geographical space between trading partners.

Research limitations/implications

To avoid the likelihood of misleading when estimating quantitatively the source of long-term export growth, researchers should be cautious in accurately evaluating the impacts of all possible factors on the two trade margins' performances, which is beyond the scope of this paper though, and a matter of ongoing work on the research agenda.

Practical implications

The study presents a set of important policy implications. Now that turnovers along the extensive margin have little impact on long-term China agri-food export growth, it turns out that improving export survival would result in significantly higher and stable export growth.

Originality/value

By distinguishing the survival of trade relationship channels from their deepening, the discoveries in the paper are crucial to understand the different role the intensive and extensive margins play in China agri-food export growth. The diversified hazard rates of export relations in different duration intervals suggest that the constant hazard rate assumption in Melitz and Bernard et al. is in some sense not appropriate.

Details

China Agricultural Economic Review, vol. 6 no. 1
Type: Research Article
ISSN: 1756-137X

Keywords

Article
Publication date: 2 May 2024

Yuchen Liu, Yinguo Dong and Weiwen Qian

The purpose of this study is to explore the effect and mechanism of the digital economy’s influence on the binary margin of agricultural exports.

Abstract

Purpose

The purpose of this study is to explore the effect and mechanism of the digital economy’s influence on the binary margin of agricultural exports.

Design/methodology/approach

Based on the theoretical analysis of the mechanism of the digital economy’s influence on the binary margin of agricultural exports, this study empirically examines the effect and mechanism of the digital economy’s influence on the binary margin of agricultural exports based on China’s customs export data from 2011 to 2016.

Findings

The relevant findings are threefold. (1) The digital economy significantly improves the binary margin of agricultural exports, and its effect on the intensive margin is stronger than that on the expansive margin. After the expansive margin is subdivided, the effects on the three sub-variables of the expansive margin are in the following order: old products exported to new markets > new products exported to old markets > new products exported to new markets. (2) The heterogeneity analysis reveals that the digital economy has a stronger role in promoting the binary margin of exports for enterprises in the eastern region, high-income countries as the destination of exports and state-owned enterprises. (3) Mechanism analysis shows that the digital economy promotes the binary margin of agricultural exports by reducing trade costs and intensifying market competition.

Originality/value

First, in terms of research perspective, although there are some studies on the impact of the digital economy on export trade in existing literature, the research objects mainly focus on manufacturing enterprises. In fact, agricultural trade is susceptible to natural conditions and seasonal factors, and countries may impose more SPS measures and TBT measures on agricultural trade due to risk considerations. The relationship between the digital economy and agricultural trade also has its own characteristics, but there are few research studies in this area. At present, only Liu and Gao (2022), based on the data of total imports and exports of different agricultural products from 2004 to 2018, have established a vector auto-regressive model to empirically analyse the heterogeneous dynamic impact of the digital economy on the trade volume of agricultural products. In addition, Ma and Guo (2023) conducted an empirical test on the total effect, regional heterogeneity and threshold effect of the digital economy on agricultural export trade based on China’s provincial panel data from 2011 to 2020. Therefore, under the new circumstances of continuous integration of digital technology and agriculture, this study interprets the impact effect and mechanism of the digital economy on the binary margin of agricultural exports from the perspective of the digital economy, providing new research perspectives and approaches for promoting the growth of agricultural exports. Second, in terms of theoretical analysis, the above studies have not been fully analysed in terms of the specific mechanism of the impact of the digital economy on agricultural exports. Based on the positive and negative characteristics of agricultural trade, this study introduces two kinds of roles into the theoretical analysis framework to comprehensively determine the trade impact effect of the digital economy. Third, in terms of research design, this study empirically examines the impact of the digital economy on the binary margin of agricultural products, passing a series of robustness tests and investigating the mediating roles of trade cost and market competition effects, producing an empirical basis for China to leverage the digital economy to promote the binary margin of agricultural exports.

Details

China Agricultural Economic Review, vol. 16 no. 3
Type: Research Article
ISSN: 1756-137X

Keywords

Open Access
Article
Publication date: 11 September 2024

Binyam Afewerk Demena

The impact of export promotion programs (EPPs) on the intensive margin of exports remains somewhat uncertain. This study tackles a crucial question: does export promotion enhance…

Abstract

Purpose

The impact of export promotion programs (EPPs) on the intensive margin of exports remains somewhat uncertain. This study tackles a crucial question: does export promotion enhance firm-level intensive margin of exports?

Design/methodology/approach

We draw upon comprehensive empirical research conducted up to 2023. We collected 951 estimates, constructed 22 variables, captured diverse contexts and employed a meta-analytical approach to scrutinize the considerable variation in findings.

Findings

The overall meta-effect, after filtering out publication bias, is positive and statistically significant. Firms receiving EPP support exhibit an export intensity that is 1–9% higher than firms not participating in such programs. Assessing the mechanisms through which EPPs bolster this, we observe that support in the form of various services plays a more substantial role compared to assistance in the form of financial resources.

Research limitations/implications

Evaluating EPPs and their activities in terms of social welfare falls beyond the scope of this paper, which specifically focuses on the benefits of EPPs to export intensity. Subsequent research should undertake a comprehensive evaluation, considering both economic impacts and costs for accurate assessments of welfare. We also suggest that future meta-analyses explore other dimensions of firm-level performance linked to EPPs.

Practical implications

Publication bias distorts the impacts of EPPs, leading to an overstatement of their actual effects. Adjusting for publication bias, the practical significance of EPPs for a country’s trade intensity appears to be limited. Additionally, the provision of diverse activities and services primarily contributes to the amplification of export margins as compared to subsidies and grants. While larger firms initially benefit more from EPPs, these effects are found to be transitory.

Originality/value

This is the first meta-analysis scrutinizing the impact of EPPs, specifically concentrating on the firm-level intensive margin of exports.

Details

Journal of Asian Business and Economic Studies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2515-964X

Keywords

Book part
Publication date: 30 September 2020

Léo Charles

Using an original product level database, this article analyzes the nature and dynamics of Swiss specializations during the “first globalization” (1850–1913). I study the…

Abstract

Using an original product level database, this article analyzes the nature and dynamics of Swiss specializations during the “first globalization” (1850–1913). I study the comparative advantages, as well as the evolution of the trade structure, in order to understand economic performance differences between Switzerland and France. Despite differences in terms of market size, some common trends are identified. I also argue that Switzerland's skilled labor force, along with an intelligent choice of economic policy, allowed this country to adapt its specialization structure to global demand and enjoy rapid economic growth.

Article
Publication date: 23 January 2009

Edward Nissan and Farhang Niroomand

The purpose of this paper is to investigate the levels of extensive (wider set of goods) and intensive (larger quantities of each good) margins for 126 countries grouped by income…

801

Abstract

Purpose

The purpose of this paper is to investigate the levels of extensive (wider set of goods) and intensive (larger quantities of each good) margins for 126 countries grouped by income and development hierarchies.

Design/methodology/approach

Analysis of variance and the coefficient of variation were used to find similarities and differences between and within the groups of countries.

Findings

Results show that the extensive margin accounts for a large share of exports of rich countries.

Originality/value

This paper highlights export margins (extensive and intensive) for groups of countries.

Details

Journal of Economic Studies, vol. 36 no. 1
Type: Research Article
ISSN: 0144-3585

Keywords

Open Access
Article
Publication date: 31 March 2021

Arsalan Ahmed, Qi Jian Hong and Hassan Tahir

The study performs an empirical test to assess the impact of the Pakistan-China Free trade agreement (FTA) on Pakistan, China, and the World's exports under homogenous and…

Abstract

The study performs an empirical test to assess the impact of the Pakistan-China Free trade agreement (FTA) on Pakistan, China, and the World's exports under homogenous and differentiated products. This study employs the modeling with Poisson specification with Poisson Pseudo-Maximum Likelihood method for the estimations. The results of empirical test show that the effect of FTA on the FTA and Non-FTA countries is greater in the differentiated product as compared to the homogenous product. Therefore, one of the most important policy implications provided by this study is that export enterprises need to concentrate on differentiated products as compare to the homogenous products after the implementation of the Pakistan-China FTA. Moreover, the previous literature concluded that Pakistan-China FTA was more beneficial for China as compared to Pakistan. However, according to this study, if Pakistani enterprises focus more on differentiated products as compared to homogenous products, then it will be equally beneficial for both Chinese and Pakistani enterprises. This study will contribute to the literature by considering the Bertrand competition between asymmetric countries and find out the effect of the FTA on these three countries. It considers China, Pakistan, and the Rest of the World as first, second, and third countries.

Details

Journal of International Logistics and Trade, vol. 19 no. 1
Type: Research Article
ISSN: 1738-2122

Keywords

Book part
Publication date: 24 September 2010

Fan Zhai

This chapter presents a global computable general equilibrium model with firm heterogeneity based on the Melitz (2003) framework and examines the relative importance of the…

Abstract

This chapter presents a global computable general equilibrium model with firm heterogeneity based on the Melitz (2003) framework and examines the relative importance of the intensive and extensive margins in the trade expansion following trade liberalization. Using a set of plausible parameters values suggested by empirical studies and calibrating the model to the recent Global Trade Analysis Project (GTAP) global database, our illustrative simulations indicate that the extensive margin accounts for around one-third of the trade growth induced by a reduction in tariffs or variable trade costs. In the case of reducing fixed trade costs, the extensive margin contributes almost 200 percent of the trade expansion, with the intensive margin contributing negatively to trade growth.

Details

New Developments in Computable General Equilibrium Analysis for Trade Policy
Type: Book
ISBN: 978-0-85724-142-9

Keywords

Book part
Publication date: 26 September 2011

Heather Antecol

Using data from the U.S. Census in conjunction with data from the Current Population Survey (1980–2009), I find little support for the opt-out revolution – highly educated women…

Abstract

Using data from the U.S. Census in conjunction with data from the Current Population Survey (1980–2009), I find little support for the opt-out revolution – highly educated women, relative to their less-educated counterparts, are exiting the labor force to care for their families at higher rates today than in earlier time periods – if one focuses solely on the decision to work a positive number of hours irrespective of marital status or race. If one, however, focuses on both the decision to work a positive number of hours and the decision to adjust annual hours of work (conditional on working), I find some evidence of the opt-out revolution, particularly among white college educated married women in male-dominated occupations.

Details

Research in Labor Economics
Type: Book
ISBN: 978-1-78052-333-0

Keywords

Article
Publication date: 25 September 2023

Kanan Elumalai and Anjani Kumar

This paper aims to analyze relative contribution of intensive margin (IM) and extensive margin (EM) to growth in India's agricultural exports for the period 2001 to 2020. It also…

Abstract

Purpose

This paper aims to analyze relative contribution of intensive margin (IM) and extensive margin (EM) to growth in India's agricultural exports for the period 2001 to 2020. It also analyses the determinants of IM and EMs through a standard gravity model.

Design/methodology/approach

The study uses export data from United Nations Comtrade, which is accessed through World Integrated Trade Solution (WITS) software. Data for the period 2001 to 2020 were compiled for analysis using the Harmonized System (HS) of commodity classification system at the six-digit level. This study decomposed the contribution of IM and EM in the growth of Indian agricultural trade by using Hummels and Klenow's approach. After performing the export decomposition analysis, the authors analyze the factors influencing IM and EM by using the Tobit regression model and Poisson pseudo-maximum-likelihood (PPML) method of estimation.

Findings

The EM grew at 1.24% per annum, while the intensive margin (IM) increased by 0.23%. The contribution of growth at the EM increased from 58.8% in 2001 to 70.2% in 2020. Export growth along the IM was relatively high for animal products and agricultural raw materials, while growth at the EM was an important contributor to the export growth of horticultural and processed agricultural products. There was a positive and significant effect of the free trade agreement (FTA) on export margins.

Research limitations/implications

More disaggregated commodity-specific studies on value chain analysis would provide valuable insights into the issues hindering exports and realizing the untapped export potential.

Originality/value

There is a scarcity of holistic and recent studies illustrating the role of IM and EMs in agricultural trade growth, covering a large number of commodities and geographies associated with Indian agricultural trade. The study would be helpful to the stakeholders in facilitating informed policy decisions.

Details

Journal of Agribusiness in Developing and Emerging Economies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2044-0839

Keywords

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