{"title":"The Relationship between Product Complexity and Exchange Rate Elasticities: Evidence from the People’s Republic of China’s Manufacturing Industries","authors":"Willem Thorbecke, Chen Chen, Nimesh Salike","doi":"10.1142/s0116110521500037","DOIUrl":null,"url":null,"abstract":"More complex products are less substitutable in international trade and may therefore have lower price elasticities. We investigate this issue using 960 types of manufactured exports from the People’s Republic of China (PRC) to 190 partner economies disaggregated at the Harmonized System 4-digit level. We measure complexity using Hidalgo and Hausmann’s (2009) product complexity index. We find that price elasticities are lower for more complex goods. These results imply that the PRC can reduce its exporters’ exposure to tariffs, trade wars, and exchange rate volatility by upgrading its export basket.","PeriodicalId":39852,"journal":{"name":"Asian Development Review","volume":"1 1","pages":""},"PeriodicalIF":1.0000,"publicationDate":"2021-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"2","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Asian Development Review","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1142/s0116110521500037","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q4","JCRName":"DEVELOPMENT STUDIES","Score":null,"Total":0}
引用次数: 2
Abstract
More complex products are less substitutable in international trade and may therefore have lower price elasticities. We investigate this issue using 960 types of manufactured exports from the People’s Republic of China (PRC) to 190 partner economies disaggregated at the Harmonized System 4-digit level. We measure complexity using Hidalgo and Hausmann’s (2009) product complexity index. We find that price elasticities are lower for more complex goods. These results imply that the PRC can reduce its exporters’ exposure to tariffs, trade wars, and exchange rate volatility by upgrading its export basket.
期刊介绍：
The Asian Development Review is a professional journal for disseminating the results of economic and development research carried out by staff and resource persons of the Asian Development Bank (ADB). The Review stresses policy and operational relevance of development issues rather than the technical aspects of economics and other social sciences. Articles are refereed and intended for readership among economists and social scientists in government, private sector, academia, and international organizations.
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