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^2. Tradeable goods are goods that are actually traded or goods that would be traded if it were profitable to do so.

^3. Feder, Gershon, “On exports and economic growth,” Journal of Development Economics, Nos. 1–2 (1983), pp. 59–73.CrossRefGoogle Scholar

^4. The two series also differ in other minor aspects.

^5. Sung Yun-wing estimates that value added constitutes 20% of the gross value of export receipts earned in processing activities. “Explaining China's export drive: the only success among command economies,” unpublished paper, 1990, p. 19.Google Scholar

^6. The General Agreement on Tariffs and Trade (in the annual International Trade), the International Monetary Fund (in the annual Direction of Trade Statistics Yearbook), and the World Bank (in the annual World Development Report) all use data of the Chinese Customs Administration as the basis for the statistical tables reporting China's trade data.

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^12. The average price China received per ton fell 21% from $185 in 1985 to $146 in 1990. State Statistical Bureau, Zhongguo tongji zhaiyao 1991 (A Statistical Survey of China 1991) (Beijing: Statistical Publishing House, 1991), p. 99.Google Scholar The change in the price of oil alone would have reduced the primary product share of exports to 47.8%, thus accounting for only one-tenth of the shrinkage of the share of primary product exports between 1985 and 1990. However, its influence was more significant in the short run. For example, the price per ton fell by 50% in 1986 to $92, contributing significantly to the sharp decline in the share of primary product exports in 1986 compared to the previous year. State Statistical Bureau, Zhongguo tongji zhaiyao 1987 (State Statistical Abstract 1987) (Beijing: Statistical Publishing House, 1987), p. 90.Google Scholar

^13. Since the data in Table 4 are derived from Customs statistics in some sense they may overstate the rising share of manufactured goods in total exports. The Customs data on exports, as explained above, include the gross value of processed and assembled exports. These exports grew dramatically in the second half of the 1980s.

^14. State Council National Industrial Census Leading Small Group Staff Office, Zhonghua renmin gongheguo 1985 nian gongye pucha ziliao (1985 Industrial Census of the People's Republic of China) (Beijing: Chinese Statistical Publishing House). The data used came from volume 3, pp. 90–121, 128–139, 204–235Google Scholar, published in March 1988. They cover all manufacturing establishments classified as independent accounting units regardless of the form of ownership. In 1988 these enterprises accounted for 85% of manufactured goods output. Rawski, Thomas G., “How fast has Chinese industry grown?” Research Paper Series No. 7, Socialist Economies Reform Unit, World Bank, 03 1991, p. 2.Google Scholar

^15. Copies of the concordance are available from the author. It should be noted that the SITC scheme includes category S9, commodities not elsewhere classified, which includes mostly export processing and assembly activities. They cannot be assigned to specific industries. Thus the analysis below does not include them.

^16. The only one of the 63 categories of exports more capital intensive was electric power, also classified as a primary product.

^17. The correlation coefficient is — 0.29. Regressing the capital/labour ratio in production on the changes in exports of all categories produces a negative coefficient that is statistically different from zero at the 5% level. This relationship would be even stronger if processed and assembled exports, which are highly labour-intensive, could be taken into account. By 1990 re-exports of processed and assembled imports rose to $10.453 billion. The absolute increase in these exports between 1985 and 1990 exceeded that of any of the two-digit export categories analysed.

^18. The share of China's export expansion accounted for by these five categories of exports is calculated on the basis of the export data reported by the Ministry of Foreign Economic Relations and Trade. This is the appropriate basis for measurement since, as noted above, the disaggregated export data being analysed excluded processing and assembly activities.

^19. Disaggregated analysis cannot be done for the whole period since detailed trade data of the Chinese Customs Administration for the years before 1982 have not been publicly released. For 1982–84 for all export categories the correlation between export performance and capital intensity in production is positive but very weak. The correlation coefficient is +0.08. The estimated coefficient on the capital/labour ratio in alinear regression on changes in exports is positive but not significant, even at the 10% level.

^20. Similar findings – that China's trade specialization in the early 1980s was not based on comparative advantage but that by the late 1980s China was exploiting its comparative advantage more fully – have been reported by Xiaogang, Zhang and Warr, Peter G., “China's trade patterns and comparative advantage,” in China: Trade and Reform (Canberra: Australian National University National Center for Development Studies, 1991), pp. 46–72.Google Scholar Their study is based on China's 1981 input-output table, which contains 14 sectors producing traded goods; estimates of relative Chinese domestic prices and world prices for these 14 sectors; and World Bank estimates of the shadow prices of primary factors. Compared to the present study the main advantage is that it takes into account the intermediate goods used in the production of exports. Its disadvantages are that it is based on far more aggregated trade data and that the World Bank estimates of shadow prices are “rough.”

^21. Wenxiu, Sun, “A review and forecast of the reforms of the foreign trade system,” Jihua jingji yanjiu (Planned Economy Research), No. 8 (1989), p. 53.Google Scholar

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^26. Wenxiu, Sun, “A review and forecast of the reforms of the foreign trade system,” Jihua jingji yanjiu (Planned Economy Research), No. 8 (1989), pp. 53–54.Google Scholar

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^33. State Bureau of Commodity Prices Foreign Price Office, “Foreign prices,”Google Scholar in State Bureau of Commodity Prices, Zhongguo wujia nianjian (1989) (Chinese Commodity Price Yearbook 1989) (Beijing: Chinese Commodity Price Publishing House, 1989), p. 162.Google Scholar

^34. Lardy, , Foreign Trade and Economic Reform in China, 1978–1990, p. 163.Google Scholar

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^39. van Brabant, Josef M., The Planned Economies and International Economic Organizations (Cambridge: Cambridge University Press, 1991), pp. 78, 93, 107.Google Scholar

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^42. Ibid. p. 61.

^43. Mingshen, Shi, “Wo guo waihui xingshi haozhuan” (“China's foreign exchange situation changes for the better”), Renmin ribao, 23 01 1992, p. 2.Google Scholar

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^45. Fengying, Hu, “A brief account of China's new foreign trade system,” Shijie jingji yanjiu (World Economy Study), No. 3 (1991), p. 33.Google Scholar Hu also estimated that the volume of market transactions in foreign exchange for the year would be $16 billion, implying an estimate of central government purchases of foreign exchange at the market price but not through the market of $9 billion. Hu's estimate turned out to be low.

^46. In the absence of other forms of protection, that provided to domestic producers of goods that compete with imports would have been reduced in many cases since the reforms of import pricing (i.e. shifting to pricing based on the world market) would have more than offset the effect of the higher domestic currency price of foreign exchange. However, in many sectors tariffs, quotas and other barriers still provide significant protection to Chinese impon competing industries.

^47. Most published provincial trade data, including that for Guangdong, is compiled on the same principles as those used by the Ministry of Foreign Economic Relations and Trade. Thus in the analysis below where the growth of the province's exports is compared to the nation as a whole and where the province's exports are expressed as a share of national exports the calculations are based on the Ministry data in Table 1.

^48. Guangdong Statistical Bureau, Guangdong tongji nianjian 1991 (Statistical Yearbook of Guangdong 1991) (Beijing: Chinese Statistical Publishing House, 1991), p. 303.Google ScholarState Statistical Bureau, Zhongguo tongji nianjian 1991 (Chinese Statistical Yearbook 1991) (Beijing: Statistical Publishing House, 1991), p. 97.Google ScholarDezhi, Xu, “Guangdong foreign trade rises to all-time high,” China Daily Business Weekly, Spring Trade Fair supplement, 15 04 1992, p. 3.Google Scholar Xu is the director of the Guangdong Provincial Foreign Economic Relations and Trade Commission.

^49. Vogel, Ezra F., One Step Ahead in China: Guangdong under Reform (Cambridge, Mass.: Harvard University Press, 1989), pp. 372–384.Google ScholarLardy, , Foreign Trade and Economic Reform in China 1978–1990, pp. 126–136, 168.Google Scholar

^50. The gross value of industrial output in 1988 in Guangdong was 105.077 billion yuan, in 1980 prices. In Shanghai it was 108.270 billion yuan, also in 1980 prices. Guangdong Statistical Bureau, Guangdong tongji nianjian 1991 (Statistical Yearbook of Guangdong 1991) (Beijing: Chinese Statistical Publishing House, 1991), p. 53Google Scholar. Shanghai Statistical Bureau, Shanghai tongji nianjian 1989 (Shanghai Statistical Yearbook 1989) (Beijing: Statistical Publishing House, 1989), p. 127.Google Scholar

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^53. Hong, Li, “Big firms to be forced into market mechanism,” China Daily, 28 02 1992, p. 1.Google Scholar

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^56. Guangdong and Shanghai respectively paid 148.0 and 39.9 yuan per ton for state allocated coal and 252.0 and 210.0 yuan per ton for coal purchased on the market. Ibid. p. 30.

^57. In the mid-1980s, foreign invested firms in Guangdong typically included standby power generation equipment in their plants. By the late 1980s local supplies of power were sufficiently reliable that such facilities were not usually included in new joint venture plants in South China.

^58. Among other local sources were bonds specifically issued by Guangzhou municipality to finance electric power projects. Wallich, Christine I., “Recent developments in China's financial sector: financial instruments and markets,” in Dorn, James A. and Xi, Wang (eds.), Economic Reform in China: Problems and Prospects (Chicago: University of Chicago Press, 1989), pp. 140–41.Google Scholar

^59. Guangdong's annual electric power outpur rose from 16.7 billion kilowatt hours in 1985 to 34.4 billion kilowatt hours in 1990. Guangdong Statistical Bureau, Guangdong tongji nianjian 1991 (Statistical Yearbook of Guangdong 1991) (Beijing: Chinese Statistical Publishing House, 1991), p. 161Google Scholar. In addition Guangdong imported electric power from Hong Kong.

^60. Shanghai's production rose from 25.63 billion kilowatt hours in 1985 to 28.4 billion kilowatt hours in 1990. Shanghai Municipal Statistical Bureau, Shanghai Statistical Yearbook 1991 (Concise edition) (Beijing: China Statistical Publishing House, 1991), p. 73Google Scholar. The municipality may have been able to draw on the East China regional grid to bring in electric power generated in adjacent provinces. Booming industrial production in some of these provinces, notably Jiangsu, may have limited these transfers.

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^67. Ibid. p. 5.

^68. Ibid. p. 12.

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