Department of Economics and Business Economics

How much did China's WTO accession increase economic growth in resource-rich countries?

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

  • Thomas Barnebeck Andersen, Department of Business and Economics, University of Southern Denmark, Denmark
  • Mikkel Barslund, Center for European Policy Studies, Unknown
  • Casper Worm Hansen, Denmark
  • Thomas Harr, Standard Chartered Bank, Unknown
  • Peter Sandholt Jensen, Department of Business and Economics, University of Southern Denmark, Denmark

We provide an estimate of China's impact on the growth rate of resource-rich countries after its WTO accession on 11 December 2001. Our empirical approach follows the logic of the differences-in-differences estimator. In addition to temporal variation arising from the WTO accession, which we argue was exogenous to other countries' growth trajectories, we exploit spatial variation arising from differences in natural resource wealth. This allows us to compare changes in economic growth in the post-accession period relative to the pre-accession period between countries that were able to benefit from the surge in demand for industrial commodities brought about by China's WTO accession and countries that were less able to do so. We find that roughly one tenth of average annual post-accession growth in resource-rich countries was due to China's increased appetite for commodities. We use this finding to inform the debate about what will happen to economic growth in resource-rich countries as China rebalances and its demand for commodities weakens.

Original languageEnglish
JournalChina Economic Review
Volume30
Pages (from-to)16-26
Number of pages11
ISSN1043-951X
DOIs
Publication statusPublished - 1 Jan 2014

    Research areas

  • China, Economic growth, Natural resources, WTO

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