China and India: Openness, Trade and Effects on Economic Growth
The purpose of this paper is to analyse the economic growth of China and India in terms of their integration in the global economy. We begin with a discussion of some stylized facts concerning their recent economic growth, the most significant institutional reforms, with particular reference to trad...
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| Format: | Article |
| Language: | English |
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Università Carlo Cattaneo LIUC
2011-06-01
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| Series: | The European Journal of Comparative Economics |
| Subjects: | |
| Online Access: | http://eaces.liuc.it/18242979201101/182429792011080106.pdf |
| _version_ | 1818154971940519936 |
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| author | Marelli, Enrico Signorelli, Marcello |
| author_facet | Marelli, Enrico Signorelli, Marcello |
| author_sort | Marelli, Enrico |
| collection | DOAJ |
| description | The purpose of this paper is to analyse the economic growth of China and India in terms of their integration in the global economy. We begin with a discussion of some stylized facts concerning their recent economic growth, the most significant institutional reforms, with particular reference to trade relations, and their impact on their economic development. We then propose a descriptive analysis of economic growth, opening up of the economies and trade specialisation, by comparing the features and trends of the two countries (by considering trade and foreign direct investment data). We have also estimated some econometric relations between economic growth and trade/openness, with the addition of control variables (such as the gross fixed capital formation). We initially used a panel data model for the two countries, to be estimated with fixed effects; to test for reverse causality, we re-estimated the fixed effects model by 2SLS (with the inclusion of specific instrumental variables). The effect on economic growth (in terms of GDP per capita) of our variables of interest - Openness and FDI - remains positive and statistically significant in all specifications, which confirms our findings even if we treat these variables as endogenous variables. The results prove the positive growth effects, for the two countries, of opening up and integrating in the world economy. Note that the robust growth of these two "giants" has contained the initial impact of the recent global crisis and is now sustaining the recovery of the entire world economy. Other policy relevant implications are discussed in the concluding section. |
| first_indexed | 2024-12-11T14:34:59Z |
| format | Article |
| id | doaj.art-975738716ea84850beab96fd628ff5b1 |
| institution | Directory Open Access Journal |
| issn | 1824-2979 |
| language | English |
| last_indexed | 2024-12-11T14:34:59Z |
| publishDate | 2011-06-01 |
| publisher | Università Carlo Cattaneo LIUC |
| record_format | Article |
| series | The European Journal of Comparative Economics |
| spelling | doaj.art-975738716ea84850beab96fd628ff5b12022-12-22T01:02:13ZengUniversità Carlo Cattaneo LIUCThe European Journal of Comparative Economics1824-29792011-06-0181129154China and India: Openness, Trade and Effects on Economic GrowthMarelli, EnricoSignorelli, MarcelloThe purpose of this paper is to analyse the economic growth of China and India in terms of their integration in the global economy. We begin with a discussion of some stylized facts concerning their recent economic growth, the most significant institutional reforms, with particular reference to trade relations, and their impact on their economic development. We then propose a descriptive analysis of economic growth, opening up of the economies and trade specialisation, by comparing the features and trends of the two countries (by considering trade and foreign direct investment data). We have also estimated some econometric relations between economic growth and trade/openness, with the addition of control variables (such as the gross fixed capital formation). We initially used a panel data model for the two countries, to be estimated with fixed effects; to test for reverse causality, we re-estimated the fixed effects model by 2SLS (with the inclusion of specific instrumental variables). The effect on economic growth (in terms of GDP per capita) of our variables of interest - Openness and FDI - remains positive and statistically significant in all specifications, which confirms our findings even if we treat these variables as endogenous variables. The results prove the positive growth effects, for the two countries, of opening up and integrating in the world economy. Note that the robust growth of these two "giants" has contained the initial impact of the recent global crisis and is now sustaining the recovery of the entire world economy. Other policy relevant implications are discussed in the concluding section.http://eaces.liuc.it/18242979201101/182429792011080106.pdfChina and Indiaeconomic growthtrade openingtrade specialisationtrade and growth |
| spellingShingle | Marelli, Enrico Signorelli, Marcello China and India: Openness, Trade and Effects on Economic Growth The European Journal of Comparative Economics China and India economic growth trade opening trade specialisation trade and growth |
| title | China and India: Openness, Trade and Effects on Economic Growth |
| title_full | China and India: Openness, Trade and Effects on Economic Growth |
| title_fullStr | China and India: Openness, Trade and Effects on Economic Growth |
| title_full_unstemmed | China and India: Openness, Trade and Effects on Economic Growth |
| title_short | China and India: Openness, Trade and Effects on Economic Growth |
| title_sort | china and india openness trade and effects on economic growth |
| topic | China and India economic growth trade opening trade specialisation trade and growth |
| url | http://eaces.liuc.it/18242979201101/182429792011080106.pdf |
| work_keys_str_mv | AT marellienrico chinaandindiaopennesstradeandeffectsoneconomicgrowth AT signorellimarcello chinaandindiaopennesstradeandeffectsoneconomicgrowth |