Trade liberalisation has transformed the economies of many developing countries. This column presents evidence from China’s accession to the WTO. The authors find that high tariffs on imported inputs prevented Chinese firms from producing high-quality goods. When these tariffs were reduced, firms upgraded the quality of their products, entering more competitive foreign markets.
- trade liberalization,
- quality upgrading,
- export price,
- quality differentiation
Available at: http://works.bepress.com/yaoamberli/4/