This research implements the panel data control method to evaluate the stimulative effects of the “One Belt, One Road” initiative on trade performance in China. We constructed a counterfactual of China’s trade surplus by exploiting the unobservable common factors that create observable trade balances among other countries. We also modified the traditional control group selection by extending it to the Elastic-Net method. This study found the following: (i) China’s annual trade surplus increased sharply by 10.69% on average since 2015. In contrast, analysis of the counterfactual showed that the net exports of China would have remained constant without the stimulation of the “One Belt, One Road” initiative; (ii) These results are robust to exports growth rates and checking by various control group selections; (iii) Although the analysis shows return to an average trading balance, we should not underestimate the benefits of the initiative in the long run.
China has shifted its focus from export-led growth to technology-driven growth. The "One Belt, One Road" initiative (OBOR) is aimed at promoting economic integration with the rest of the world that might boost China's ability to upgrade its manufacturers. We evaluate the impact of the OBOR initiative on the manufacturing industries of China. In other words, we examine whether the greater openness entailed by the initiative has been a catalyst for upgrading China's export portfolio. We demonstrate that the proposition has been such a catalyst formally and adduce some empirical support for the proposition by using a panel of the top 80 exporting countries in the world during the period from 2002-2017 to evaluate the impact of the economic integration brought by the OBOR in terms of upgrades to Chinese manufacturers. Meanwhile, when domestic R&D generates knowledge spillover, the benefits of greater openness become partly indeterminate, thus counterfactual analysis was adopted to preclude potential endogeneity. By relating the values of exports at the two-digit harmonized system level to data on sectors to conduct integration within global production networks, we find that the greater openness brought by the OBOR initiative has actively increased manufacturing complexity and facilitated industrial upgrading in China.
Green production, which reduces hazardous industrial discharges per unit output, is promoted throughout China. The Environmental Kuznets Curve suggests a negative correlation between hazardous industrial discharge and economic growth due to green innovation. This study expanded the EKC framework by including heterogeneity in evaluating the relationship between hazardous industrial discharges and economic growth to reflect green transformation. Administrative ranking disparity is identified as one of the fundamental driving forces of green production transition in a developing country. Building on an enriched EKC framework, we used a spatial estimation model to exclude spatial effects and obtained accurate estimates of the classified regions. The modified research method was used to examine whether industrial pollution has been reduced in 267 cities and towns in China from 2007 to 2021. Environmental protection performance was examined to estimate whether there is a switch to green manufacturing. As industrial hazards are of different types, the author sought to determine whether there was a decrease in industrial sulphur dioxide emissions, wastewater, solid waste, or dust, even though more industrial hazards were recycled than before. The spatial estimates indicated that (a) the national level of pollution remains positively linked with the total output, and every percentage of output growth increases sulphur dioxide emissions by 444.573 tons; (b) a positive relationship between economic growth and wastewater is altered by environmental protection in cities, while the general decoupling between economic growth and other types of industrial pollution, such as solid waste and industrial dust, was not observed; (c) growth in the southeast was decoupled from sulphur emissions, and its sulphur dioxide production per unit of output increased to 0.021 tons. Sulphur dioxide emissions per unit of economic growth along the southeast coast were 379. 048 tons, which was well below the overall average of 444.573 tons. High-income towns along the southeast coast have achieved clean production breakthroughs, realising a 15% reduction in industrial sulphur dioxide emissions by 2021. Although there were signs of a shift toward clean manufacturing in high administrative ranking cities, most regions of China are transitioning to environmentally friendly manufacturing and suffer from the hardships of green production transformation.
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