Search results

Abstract: This article highlights the role of sourcing inputs from China for Central and Eastern European (CEE) countries' exports and sheds light on the rising trade deficit between China and the se countries. Research findings on gross and value-added trade panel data for 12 CEE countries suggest that a 10 per cent increase of imported capital inputs from China would cause an overall increase of 2.4 per cent in CEE exports. The effect is more pronounced for both intermediates and capital inputs imported from China, taking domestic value-added exports into consideration. By taking into account the possible endogeneity in baseline regression and the COVID-19 pandemic as an instrument of supply shock for imports from China, findings affirm that sourcing from China has promoted significantly CEE countries' gross exports as well as domestic value-added in exports. Moreover, the export boosting effect affects significantly the intensive margin. This article has rich policy implications for CEE countries to improve trade deficits with China.

This article highlights the role of sourcing inputs from China for Central and Eastern European (CEE) countries' exports and sheds light on the rising trade deficit between China and the se countries. Research findings on gross and value-added trade panel data for 12 CEE countries suggest that a 10 per cent increase of imported capital inputs from China would cause an overall increase of 2.4 per cent in CEE exports. The effect is more pronounced for both intermediates and capital inputs imported from China, taking domestic value-added exports into consideration. By taking into account the possible endogeneity in baseline regression and the COVID-19 pandemic as an instrument of supply shock for imports from China, findings affirm that sourcing from China has promoted significantly CEE countries' gross exports as well as domestic value-added in exports. Moreover, the export boosting effect affects significantly the intensive margin. This article has rich policy implications for CEE countries to improve trade deficits with China. (China/GIGA)

peer-reviewed ; This article investigates the effects of China's outward direct investment (ODI) on the institutional quality of the Belt and Road (B&R) countries. Based on a panel data set of 63 B&R countries during the period 2003 to 2016, we find that China's ODI improves the institutional quality of B&R countries not only in the short run but also in the long run. Further, although China's ODI exerts no differential impacts on host country institutional dimensions of "control of corruption," "government effectiveness," and "political stability" in countries with different natural resource endowments, it improves their institutional dimensions of "regulatory quality" and "rule of law," implying that China's ODI may help the host B&R countries minimize the "resource curse". As one of the most important strategies for China's opening-up development in the current era, the B&R initiative serves as means to promote sustainable development of B&R countries. The article therefore contributes to existing scholarship on the institutional effects of China's ODI and sheds light on the mechanisms that drive sustainable development.