China’s bulk commodity exports, product spatial correlation and the increasing of comparative advantages of the export products of the countries along the Belt and Road

SUN Churen1 YI Zhengrong2

(1.Guangdong Institute for International Strategies, Guangdong University of Foreign Studies)
(2.School of International Business of Southwestern University of Finance and Economics)

【Abstract】The trade between China and the countries along the Belt and Road not only provides platforms and opportunities for China’s bulk commodity industry to participate in the competition of the world market, but also creates new opportunities for the economic development of countries along the Belt and Road. From the perspective of the structure of product space, this paper investigated the impact of China’s import of bulk commodities from the countries along the Belt and Road on the comparative advantages of their exports. The research results show that the closer a country’s exporting product to China’s import of bulk commodities from this country is, the more China’s import of bulk commodities from that country is, and the greater the revealed comparative advantage of the country’s product for the next period will be. Compared with exporting bulk commodities to other countries in the world, exporting bulk commodities to China by countries along the Belt and Road is more conducive to the improvement of the comparative advantages of their export products.

【Keywords】 the Belt and Road Initiative; comparative advantage; bulk commodities; product space;

【DOI】

【Funds】 The National Social Science Fund of China (18ZDA039) Shanghai Municipal Education Commission, Shanghai Education Development Foundation (14SG51) National Natural Science Foundation of China (71832012)

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    Footnote

    [1]. ① Since the research object of this paper is the comparative advantage of the products of the countries along the Belt and Road, the comparative advantage of the countries along the route is mainly reflected as the export of resource products. According to the HK theory, the products with great proximity with products with comparative advantages are easier to obtain comparative advantages, and if a country expects to have revealed comparative advantages in products, it must have suitable resources and the ability to produce products and export. Thus, this paper chooses to use exported bulk commodities as the representatives of products with comparative advantages. For products that are not exported, most comparative advantage values may be low. In the case of similar proximity, enterprises producing new products should preferentially choose the production technology of products with comparative advantages to imitate. Thus, this paper believes that the influence of products that are not exported on the impact of product proximity on products’ comparative advantages should be small or even negligible. [^Back]

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This Article

ISSN:1002-4670

CN: 11-1692/F

Vol , No. 12, Pages 76-90

December 2019

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Article Outline

Abstract

  • Introduction
  • 1 Literature review and theoretical basis
  • 2 Main variable measurement indicators and data processing
  • 3 Empirical model and results
  • 4 Robustness analysis
  • 5 Endogeneity problems
  • 6 Analysis on the differences between the export of bulk commodities to China and the export to other countries by countries along the Belt and Road
  • 7 Conclusion and policy implication
  • Footnote

    References