Economic impacts of the EU–China comprehensive investment agreement: A dynamic general equilibrium analysis
Fan Zhai,
Juzhong Zhuang
Abstract:Using a global dynamic general equilibrium model with foreign direct investment (FDI) and technology capital, this paper finds that the EU–China Comprehensive Agreement on Investment (CAI) could bring modest but nonnegligible benefits to both sides. Under an illustrative scenario in which the CAI increases the degree of openness to bilateral FDI by 10%, the EU's FDI to China could rise by a factor of 3–4 and China's FDI to the EU by a factor of 3. These would generate a gain in the steady‐state gross national … Show more
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