The effect of China's political relations on her international trade

Gregory W. WHITTEN; Xiaoyi DAI; Cheng Ze Simon FAN; Yifan ZHANG

The effect of China's political relations on her international trade

Gregory W. WHITTEN, Xiaoyi DAI, Cheng Ze Simon FAN, Yifan ZHANG

Department of Economics

Research output: Other Conference Contributions › Conference Paper (other) › Research › peer-review

Abstract

China's growing influence on the world has had profound effects on the political and economic decisions of her partner countries. This paper demonstrates that regardless of the severity of the conflict (displeasure at meetings with the Dalai Lama; saber-rattling over disputed territory), political relations affect trade between China and her partners. Warmer relations lead to larger increases (or smaller decreases) in trade while cooler relations have the opposite effect. This finding is robust to estimation methods (pair-specific VARs; a SUR system).

Original language	English
Number of pages	28
Publication status	Published - 13 Dec 2016
Event	The 9th Biennial Conference of Hong Kong Economic Association - The University of Hong Kong, Pokfulam, Hong Kong Duration: 12 Dec 2016 → 13 Dec 2016 http://www.hkea.org.hk/index.php/9th-conference

Conference

Conference	The 9th Biennial Conference of Hong Kong Economic Association
Country/Territory	Hong Kong
City	Pokfulam
Period	12/12/16 → 13/12/16
Other	Hong Kong Economic Association
Internet address	http://www.hkea.org.hk/index.php/9th-conference

Bibliographical note

This project is joint work with Xiaoyi DAI, (The Chinese University of Hong Kong), Simon FAN, (Lingnan University), and Yifan ZHANG (CUHK).

Keywords

international trade
conflict
political tensions

Cite this

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AU - DAI, Xiaoyi

AU - FAN, Cheng Ze Simon

AU - ZHANG, Yifan

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N2 - China's growing influence on the world has had profound effects on the political and economic decisions of her partner countries. This paper demonstrates that regardless of the severity of the conflict (displeasure at meetings with the Dalai Lama; saber-rattling over disputed territory), political relations affect trade between China and her partners. Warmer relations lead to larger increases (or smaller decreases) in trade while cooler relations have the opposite effect. This finding is robust to estimation methods (pair-specific VARs; a SUR system).

AB - China's growing influence on the world has had profound effects on the political and economic decisions of her partner countries. This paper demonstrates that regardless of the severity of the conflict (displeasure at meetings with the Dalai Lama; saber-rattling over disputed territory), political relations affect trade between China and her partners. Warmer relations lead to larger increases (or smaller decreases) in trade while cooler relations have the opposite effect. This finding is robust to estimation methods (pair-specific VARs; a SUR system).

KW - international trade

KW - conflict

KW - political tensions

UR - http://www.hkea.org.hk/index.php/9th-conference/9th-programme

M3 - Conference Paper (other)

T2 - The 9th Biennial Conference of Hong Kong Economic Association

Y2 - 12 December 2016 through 13 December 2016

ER -

The effect of China's political relations on her international trade

Abstract

Conference

Bibliographical note

Keywords

Other files and links

Do political relations affect international trade? Evidence from China’s twelve trading partners

Cite this