Bilateral trade and shocks in political relations: Evidence from China and some of its major trading partners, 1990-2013

• 成果类型: Article
• 署名作者: Du, Yingxin; Ju, Jiandong; Ramirez, Carlos D.; Yao, Xi
• 署名单位: University of International Business & Economics; Tsinghua University; Shanghai University of Finance & Economics; George Mason University; Peking University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2017.07.002
• 发表日期: 2017
• 页码: 211-225
• 关键词: Political relations; bilateral trade; CHINA; Temporal aggregation bias

摘要

An extensive number of studies investigate the effects of political relations on trade by estimating a gravity model using annual (or quarterly) data. We argue that the use of low-frequency data introduces an aggregation bias because the cycle of moderate political shocks is much shorter (measured in weeks). Using monthly data from 1990 through 2013 for China, we estimate a model of political relations and conclude that political shocks are short-lived. Narrative evidence from two case studies illustrates the transitory nature of these shocks. A VAR model shows that although political shocks influence exports to China, the effects largely vanish within two months. A comparison of the monthly- and annual-frequency gravity equation regressions illustrates the effects of temporal aggregation. (C) 2017 Elsevier B.V. All rights reserved.