Topic：Quality and Input Choices: Evidence from Chinese Exporters

Speaker：Luhang Wang

Affiliation: Xiamen University

Time：2:00-3:30pm, October 30

Location：Room 217, Guanghua New Building

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Speaker’s CV: Download PDF

Abstract: Using the detailed Chinese firm level exports information between 2000 and 2006, this paper estimates market- and product-specific demand functions for China's Electrical Machineries exports and recover the latent quality ranking as the demand residual. I apply an instrument based on the idea of Hausman-Nevo instrument to this multi-market and multi-origin data for identification. I then combine the quality measure with other firm level observations to identify factors underlying the cross firm variation in the measured quality. I find quality of exports to rich countries to be positively correlated with importing activities, and especially the imports of intermediated inputs from rich countries for Chinese non-state owned firms. I also find a positive correlation with wage which holds for not only Chinese non-state owned firms, but also for foreign invested firms, including those with investment from by Hong Kong, Macao and Taiwan.