Title: Vertical specialisation and the growth of China's exporting manufacturing industries: an empirical analysis based on the data from 1992 to 2009

Authors: Ying Ma; Han Li

Addresses: School of Economics and Management, Division of Arts and Sciences, Wuhan University, Hubei, 430072, China ' Division of Arts and Sciences, Institute of Quality Development Strategy, Wuhan University, The Second Floor, Old Literature Building, Sakura Garden, Hubei, 430072, China

Abstract: This paper tries to integrate the new paradigm of the vertical specialisation with the driving forces of international trade, which have been testified by different paradigms of international trade theory, so as to build up an econometric model. Then, by this model, we use China's 1992-2009 trade data of manufacturing industries to regress the dependent variables of trade volume, competitiveness with the interactive variables built by multiplication of vertical specialisation index and such factors as the ratio of capital to labour, economies of scale and total factor productivity. Our findings have justified that along with the vertical specialisation, those factors have contributed a lot to the growth of international trade and the upgrade of international competitiveness. But the interactive variable of vertical specialisation and economies of scale has not been justified as a factor to increase the international competitiveness of China's manufacturing industry. Not only has this paper made a tentative attempt in explaining the driving factors behind the rapid aggregate growth in China's foreign trade, but also in exploring how the global vertical specialisation has shaped and upgraded the industrial structure of China's exporting manufacturing sector.

Keywords: vertical specialisation; manufacturing exports; manufacturing industry; industrial structure; China; international trade; econometric modelling; international competitiveness.

DOI: 10.1504/IJEPEE.2013.057911

International Journal of Economic Policy in Emerging Economies, 2013 Vol.6 No.4, pp.341 - 357

Published online: 28 Jun 2014 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article