Title: Government Expenditure and Mitigating Trade Risk ——Evidence from China
Abstract: In this paper,econometric methods and time series methods like bounds test and autoregressive distributed lag model are applied to analyze long-term relationship and correlation mechanism between government size and openness in China from 1980 to 2008.Results show significant long-term relationship exists between government size and trade openness in China,and trade risk incurred by mitigating terms of trade volatility is internal correlation mechanism in their relationship,which is consistent with Rodrik's(1998) results from cross-section data method.Our results mean that China's positive fiscal policy,to some degree,contributes to mitigating trade risk since Asian financial crisis in 1997.
Publication Year: 2012
Publication Date: 2012-01-01
Language: en
Type: article
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