The Consequences of China's WTO Accession for Its Neighbors

Warwick J. McKibbin · Wing Thye Woo

102 citations0/0 files storedAsian Economic Papers

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Global trade and economics International Business and FDI Economic Growth and Productivity

Abstract

Our simulations of a global macroeconomic model suggest that China's WTO accession could create significant welfare losses in the ASEAN-4 if foreign direct investment (FDI) is significantly redirected away from these countries toward China, and if the ASEAN-4 countries are unable to implement policies to make up for the slower rate of technological diffusion from the reduced FDI inflow. If the ASEAN-4 do not fall behind technologically, then they will be able to find lucrative niches within the lengthened international manufacturing production chains. The ASEAN-4 must therefore strengthen their abilities to absorb new foreign technologies quickly and to engage in indigenous technical innovations.

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References

1995Economic Reform and the Process of Global Integration 1999The theoretical and empirical structure of the G-Cubed model 2002World Investment Report 2002: Transnational Corporations and Export Competitiveness 1991Global Linkages: Macroeconomic Interdependence and Cooperation in the World Economy 2001Trade Liberalization in China's Accession to WTO 2001Trade Liberalization in China’s Accession to the World Trade Organization 2016Trade Liberalization and Productivity Growth: Evidence from Indian Manufacturing

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