How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?

This paper estimates the elasticity of substitution of U.S. imports using detailed trade data over the 1990-2003 period. The authors use a two-stage least squares framework in order to identify the elasticity parameter of interest. The authors use...

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Main Authors: López-Córdova, J. Ernesto, Micco, Alejandro, Molina, Danielken
Format: Policy Research Working Paper
Language:English
Published: World Bank, Washington, DC 2012
Subjects:
GDP
Online Access:http://documents.worldbank.org/curated/en/2008/01/8973089/sensitive-latin-american-exports-chinese-competition-market
http://hdl.handle.net/10986/6378
id okr-10986-6378
recordtype oai_dc
spelling okr-10986-63782021-04-23T14:02:31Z How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market? López-Córdova, J. Ernesto Micco, Alejandro Molina, Danielken ADVERSE EFFECTS AGGREGATE TRADE AGRICULTURE APPAREL APPAREL EXPORTS APPAREL GOODS APPAREL PRODUCTS AVERAGE TARIFF AVERAGE TARIFFS BILATERAL TRADE BUSINESS ENVIRONMENT CAPITAL REQUIREMENT CAPITAL REQUIREMENTS CAPITAL SHARE CENTRAL AMERICA CENTRAL AMERICAN COMMODITY PRICE COMPARATIVE ADVANTAGE COMPETITIVENESS CONSTANT ELASTICITY OF SUBSTITUTION CONSUMER PRICE CONSUMERS COUNTRY OF ORIGIN CURRENCY CUSTOMS DEMAND ELASTICITY DEMAND FOR GOODS DEMAND FUNCTION DEVELOPMENT BANK ECONOMIC EFFECTS ELASTICITY ELASTICITY OF SUBSTITUTION ELIMINATION OF TARIFFS EQUILIBRIUM EQUIPMENT EXPENDITURE EXPENDITURES EXPORT DYNAMISM EXPORT GROWTH EXPORT PERFORMANCE EXPORTERS EXPORTS FACTOR PRICES FAIR FINANCIAL SECTOR FORECASTS FREE TRADE FREE TRADE AGREEMENT FREE TRADE AGREEMENTS FREE TRADE AREA GDP GDP PER CAPITA GENERAL EQUILIBRIUM GRAVITY FRAMEWORK GROWTH RATE HOLDING IMPORT DATA IMPORT QUOTA IMPORT QUOTAS IMPORT SHARE IMPORT TARIFFS IMPORT VALUE INPUT PRICES INSTRUMENT INTERMEDIATE GOODS INTERMEDIATE INPUTS INTERNATIONAL BANK INTERNATIONAL FINANCE INTERNATIONAL TRADE INTERNATIONAL TRADE COMMISSION LATIN AMERICAN LOW TARIFFS MARGINAL COSTS MARKET ACCESS MARKET SHARE MARKET SHARES METAL PRODUCTS PREFERENTIAL ACCESS PREFERENTIAL TARIFF PREFERENTIAL TRADE PRICE CHANGES PRICE EFFECT PRICE ELASTICITY PRICE INDEX PRICE LEVEL PRICE OF IMPORTS PRICE TRENDS PRODUCER PRICE QUOTAS REGIONAL INTEGRATION SALES SOUTH AMERICA SOUTH AMERICAN SUPPLIER TARIFF ELIMINATION TARIFF EQUIVALENT TARIFF LINE TARIFF LINES TARIFF PREFERENCES TARIFF REDUCTION TEXTILE IMPORTS TRADE AGREEMENT TRADE AGREEMENTS TRADE DATA TRADE IMPEDIMENTS TRADE PARTNER TRADE PATTERNS TRADE POLICIES TRADE POLICY TRANSPORT COSTS URUGUAY ROUND UTILITY FUNCTION VALUE ADDED VALUE OF EXPORTS VALUE OF IMPORTS VOLUME OF TRADE WAGES WORLD MARKETS WORLD TRADE WORLD TRADE ORGANIZATION This paper estimates the elasticity of substitution of U.S. imports using detailed trade data over the 1990-2003 period. The authors use a two-stage least squares framework in order to identify the elasticity parameter of interest. The authors use the elasticity estimates to assess the extent to which Latin American and Chinese goods compete in the U.S. market by providing forecasts of how alternative policy scenarios may affect exports to the United States. The analysis considers the following scenarios: (i) currency revaluation in China; (ii) elimination of U.S. tariffs on Latin American exports under a hemispheric free trade agreement; and (iii) the elimination of quotas on apparel and textile exports under the Multi-Fiber Agreement. The findings show that a 20-percent appreciation of the renminbi reduces Chinese exports to the United States by a fifth, although since other regions increase sales to that market (0.5 percent for Latin America), U.S. imports decline by only 1.7 percent. Hemispheric free trade would increase Latin America's exports to the United States by around 3 percent. The removal of the quotas would lead to a sharp increase in Chinese sales to the United States (40 percent), but Latin America would see its share of the U.S. market decline by around 2 percent (2.5 percentage points). China's gains would come mainly at the expense of other regions of the world. 2012-05-24T19:19:13Z 2012-05-24T19:19:13Z 2008-01 http://documents.worldbank.org/curated/en/2008/01/8973089/sensitive-latin-american-exports-chinese-competition-market http://hdl.handle.net/10986/6378 English Policy Research Working Paper; No. 4497 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research East Asia and Pacific Latin America & Caribbean Latin America
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic ADVERSE EFFECTS
AGGREGATE TRADE
AGRICULTURE
APPAREL
APPAREL EXPORTS
APPAREL GOODS
APPAREL PRODUCTS
AVERAGE TARIFF
AVERAGE TARIFFS
BILATERAL TRADE
BUSINESS ENVIRONMENT
CAPITAL REQUIREMENT
CAPITAL REQUIREMENTS
CAPITAL SHARE
CENTRAL AMERICA
CENTRAL AMERICAN
COMMODITY PRICE
COMPARATIVE ADVANTAGE
COMPETITIVENESS
CONSTANT ELASTICITY OF SUBSTITUTION
CONSUMER PRICE
CONSUMERS
COUNTRY OF ORIGIN
CURRENCY
CUSTOMS
DEMAND ELASTICITY
DEMAND FOR GOODS
DEMAND FUNCTION
DEVELOPMENT BANK
ECONOMIC EFFECTS
ELASTICITY
ELASTICITY OF SUBSTITUTION
ELIMINATION OF TARIFFS
EQUILIBRIUM
EQUIPMENT
EXPENDITURE
EXPENDITURES
EXPORT DYNAMISM
EXPORT GROWTH
EXPORT PERFORMANCE
EXPORTERS
EXPORTS
FACTOR PRICES
FAIR
FINANCIAL SECTOR
FORECASTS
FREE TRADE
FREE TRADE AGREEMENT
FREE TRADE AGREEMENTS
FREE TRADE AREA
GDP
GDP PER CAPITA
GENERAL EQUILIBRIUM
GRAVITY FRAMEWORK
GROWTH RATE
HOLDING
IMPORT DATA
IMPORT QUOTA
IMPORT QUOTAS
IMPORT SHARE
IMPORT TARIFFS
IMPORT VALUE
INPUT PRICES
INSTRUMENT
INTERMEDIATE GOODS
INTERMEDIATE INPUTS
INTERNATIONAL BANK
INTERNATIONAL FINANCE
INTERNATIONAL TRADE
INTERNATIONAL TRADE COMMISSION
LATIN AMERICAN
LOW TARIFFS
MARGINAL COSTS
MARKET ACCESS
MARKET SHARE
MARKET SHARES
METAL PRODUCTS
PREFERENTIAL ACCESS
PREFERENTIAL TARIFF
PREFERENTIAL TRADE
PRICE CHANGES
PRICE EFFECT
PRICE ELASTICITY
PRICE INDEX
PRICE LEVEL
PRICE OF IMPORTS
PRICE TRENDS
PRODUCER PRICE
QUOTAS
REGIONAL INTEGRATION
SALES
SOUTH AMERICA
SOUTH AMERICAN
SUPPLIER
TARIFF ELIMINATION
TARIFF EQUIVALENT
TARIFF LINE
TARIFF LINES
TARIFF PREFERENCES
TARIFF REDUCTION
TEXTILE IMPORTS
TRADE AGREEMENT
TRADE AGREEMENTS
TRADE DATA
TRADE IMPEDIMENTS
TRADE PARTNER
TRADE PATTERNS
TRADE POLICIES
TRADE POLICY
TRANSPORT COSTS
URUGUAY ROUND
UTILITY FUNCTION
VALUE ADDED
VALUE OF EXPORTS
VALUE OF IMPORTS
VOLUME OF TRADE
WAGES
WORLD MARKETS
WORLD TRADE
WORLD TRADE ORGANIZATION
spellingShingle ADVERSE EFFECTS
AGGREGATE TRADE
AGRICULTURE
APPAREL
APPAREL EXPORTS
APPAREL GOODS
APPAREL PRODUCTS
AVERAGE TARIFF
AVERAGE TARIFFS
BILATERAL TRADE
BUSINESS ENVIRONMENT
CAPITAL REQUIREMENT
CAPITAL REQUIREMENTS
CAPITAL SHARE
CENTRAL AMERICA
CENTRAL AMERICAN
COMMODITY PRICE
COMPARATIVE ADVANTAGE
COMPETITIVENESS
CONSTANT ELASTICITY OF SUBSTITUTION
CONSUMER PRICE
CONSUMERS
COUNTRY OF ORIGIN
CURRENCY
CUSTOMS
DEMAND ELASTICITY
DEMAND FOR GOODS
DEMAND FUNCTION
DEVELOPMENT BANK
ECONOMIC EFFECTS
ELASTICITY
ELASTICITY OF SUBSTITUTION
ELIMINATION OF TARIFFS
EQUILIBRIUM
EQUIPMENT
EXPENDITURE
EXPENDITURES
EXPORT DYNAMISM
EXPORT GROWTH
EXPORT PERFORMANCE
EXPORTERS
EXPORTS
FACTOR PRICES
FAIR
FINANCIAL SECTOR
FORECASTS
FREE TRADE
FREE TRADE AGREEMENT
FREE TRADE AGREEMENTS
FREE TRADE AREA
GDP
GDP PER CAPITA
GENERAL EQUILIBRIUM
GRAVITY FRAMEWORK
GROWTH RATE
HOLDING
IMPORT DATA
IMPORT QUOTA
IMPORT QUOTAS
IMPORT SHARE
IMPORT TARIFFS
IMPORT VALUE
INPUT PRICES
INSTRUMENT
INTERMEDIATE GOODS
INTERMEDIATE INPUTS
INTERNATIONAL BANK
INTERNATIONAL FINANCE
INTERNATIONAL TRADE
INTERNATIONAL TRADE COMMISSION
LATIN AMERICAN
LOW TARIFFS
MARGINAL COSTS
MARKET ACCESS
MARKET SHARE
MARKET SHARES
METAL PRODUCTS
PREFERENTIAL ACCESS
PREFERENTIAL TARIFF
PREFERENTIAL TRADE
PRICE CHANGES
PRICE EFFECT
PRICE ELASTICITY
PRICE INDEX
PRICE LEVEL
PRICE OF IMPORTS
PRICE TRENDS
PRODUCER PRICE
QUOTAS
REGIONAL INTEGRATION
SALES
SOUTH AMERICA
SOUTH AMERICAN
SUPPLIER
TARIFF ELIMINATION
TARIFF EQUIVALENT
TARIFF LINE
TARIFF LINES
TARIFF PREFERENCES
TARIFF REDUCTION
TEXTILE IMPORTS
TRADE AGREEMENT
TRADE AGREEMENTS
TRADE DATA
TRADE IMPEDIMENTS
TRADE PARTNER
TRADE PATTERNS
TRADE POLICIES
TRADE POLICY
TRANSPORT COSTS
URUGUAY ROUND
UTILITY FUNCTION
VALUE ADDED
VALUE OF EXPORTS
VALUE OF IMPORTS
VOLUME OF TRADE
WAGES
WORLD MARKETS
WORLD TRADE
WORLD TRADE ORGANIZATION
López-Córdova, J. Ernesto
Micco, Alejandro
Molina, Danielken
How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
geographic_facet East Asia and Pacific
Latin America & Caribbean
Latin America
relation Policy Research Working Paper; No. 4497
description This paper estimates the elasticity of substitution of U.S. imports using detailed trade data over the 1990-2003 period. The authors use a two-stage least squares framework in order to identify the elasticity parameter of interest. The authors use the elasticity estimates to assess the extent to which Latin American and Chinese goods compete in the U.S. market by providing forecasts of how alternative policy scenarios may affect exports to the United States. The analysis considers the following scenarios: (i) currency revaluation in China; (ii) elimination of U.S. tariffs on Latin American exports under a hemispheric free trade agreement; and (iii) the elimination of quotas on apparel and textile exports under the Multi-Fiber Agreement. The findings show that a 20-percent appreciation of the renminbi reduces Chinese exports to the United States by a fifth, although since other regions increase sales to that market (0.5 percent for Latin America), U.S. imports decline by only 1.7 percent. Hemispheric free trade would increase Latin America's exports to the United States by around 3 percent. The removal of the quotas would lead to a sharp increase in Chinese sales to the United States (40 percent), but Latin America would see its share of the U.S. market decline by around 2 percent (2.5 percentage points). China's gains would come mainly at the expense of other regions of the world.
format Publications & Research :: Policy Research Working Paper
author López-Córdova, J. Ernesto
Micco, Alejandro
Molina, Danielken
author_facet López-Córdova, J. Ernesto
Micco, Alejandro
Molina, Danielken
author_sort López-Córdova, J. Ernesto
title How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
title_short How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
title_full How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
title_fullStr How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
title_full_unstemmed How Sensitive Are Latin American Exports to Chinese Competition in the U.S. Market?
title_sort how sensitive are latin american exports to chinese competition in the u.s. market?
publisher World Bank, Washington, DC
publishDate 2012
url http://documents.worldbank.org/curated/en/2008/01/8973089/sensitive-latin-american-exports-chinese-competition-market
http://hdl.handle.net/10986/6378
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