China, India, and the Future of the World Economy : Fierce Competition or Shared Growth?

Although both China and India are labor-abundant and dependant on manufactures, their export mixes are very different. Only one product-refined petroleum-appears in the top 25 products for both countries, and services exports are roughly twice as important for India as for China, which is much better integrated into global production networks. Even assuming India also begins to integrate into global production chains and expands exports of manufactures, there seems to be opportunity for rapid growth in both countries. Accelerated growth through efficiency improvements in China and India, especially in their high-tech industries, will intensify competition in global markets leading to contraction of the manufacturing sectors in many countries. Improvement in the range and quality of exports from China and India has the potential to create substantial welfare benefits for the world, and for China and India, and to act as a powerful offset to the terms-of-trade losses otherwise associated with rapid export growth. However, without efforts to keep up with China and India, some countries may see further erosion of their export shares and high-tech manufacturing sectors.

Bibliographic Details

Main Authors:	Dimaranan, Betina, Ianchovichina, Elena, Martin, Will
Language:	English
Published:	World Bank, Washington, DC 2007-08
Subjects:	ABSOLUTE VALUE, ACCESSION COMMITMENTS, ACCUMULATION OF CAPITAL, ADJUSTMENT COSTS, AGRICULTURE, ANNUAL GROWTH, APPAREL, APPAREL INDUSTRIES, APPAREL INDUSTRY, APPAREL QUOTAS, BANK OFFICE, BILATERAL TRADE, CAPITAL ACCUMULATION, COMMODITY, COMMODITY EXPORTS, COMPARATIVE ADVANTAGE, COMPETITIVENESS, CONSTANT RETURNS TO SCALE, CONSUMER DEMAND, COUNTRY FORECASTS, DEBT, DEMAND ELASTICITIES, DEMAND FOR GOODS, DEVALUATION, DEVELOPED COUNTRIES, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DEVELOPING ECONOMIES, DEVELOPMENT ECONOMICS, DIRECT INVESTMENT, DIVIDENDS, DOMESTIC GOODS, DOMESTIC MARKET, DUTY DRAWBACK, DUTY DRAWBACKS, ECONOMIC DEVELOPMENT, ECONOMIC EXPANSION, ECONOMIC GEOGRAPHY, ECONOMIC PERFORMANCE, ECONOMIC POLICY, ECONOMIC POWERS, ECONOMIC RESEARCH, ELASTICITY, ELASTICITY OF SUBSTITUTION, ELECTRONICS INDUSTRY, EXCHANGE RATE, EXPANSION OF EXPORTS, EXPORT BASKETS, EXPORT GROWTH, EXPORT MARKET, EXPORT PRICES, EXPORT PROCESSING, EXPORT SECTORS, EXPORT SHARE, EXPORT SHARES, EXPORT VOLUME, EXPORT VOLUMES, EXPORTER, EXPORTERS, EXPORTS, FACTOR ENDOWMENTS, FINAL GOODS, FORECASTS, FOREIGN TRADE, FREE ACCESS, GDP, GENERAL EQUILIBRIUM, GENERAL EQUILIBRIUM MODEL, GLOBAL COMPETITION, GLOBAL ECONOMIC PROSPECTS, GLOBAL ECONOMY, GLOBAL INTEGRATION, GLOBAL INVESTMENT, GLOBAL MARKETS, GLOBAL TRADE, GLOBAL TRADE ANALYSIS, GROWTH RATES, HUMAN CAPITAL, IDIOSYNCRATIC FACTORS, IMBALANCES, IMPERFECT SUBSTITUTES, IMPORT, IMPORT DATA, IMPORT DEMAND, IMPORT SUBSTITUTION, IMPORTS, INCOME, INCOME LEVELS, INCOMES, INCREASING RETURNS, INCREASING RETURNS TO SCALE, INDUSTRIAL COUNTRIES, INDUSTRY TRADE, INTERMEDIATE IMPORTS, INTERMEDIATE INPUTS, INTERNATIONAL PRODUCTION, INTERNATIONAL TRADE, INTERNATIONAL TRANSPORT, LABOR MARKET, LABOR MARKET POLICIES, LABOR-ABUNDANT COUNTRIES, LATIN AMERICAN, LOW-INCOME COUNTRIES, MANUFACTURING INDUSTRIES, MANUFACTURING INDUSTRY, MARKET ENTRY, MIDDLE EAST, MIDDLE INCOME COUNTRIES, NATURAL RESOURCE, NEW MARKETS, NEW PRODUCTS, NORTH AFRICA, OUTPUT, OUTPUT DECLINES, OUTPUTS, PACIFIC REGION, PARTIAL EQUILIBRIUM ANALYSES, PARTICULAR COUNTRIES, POSITIVE SPILLOVER, POSITIVE SPILLOVER EFFECTS, PRICE DECLINES, PRICE OF EXPORTS, PRICE OF IMPORTS, PRODUCT DIFFERENTIATION, PRODUCT MARKETS, PRODUCTION COSTS, PRODUCTIVITY GROWTH, RAPID ECONOMIC GROWTH, RAPID EXPANSION, RAPID EXPORT GROWTH, RAPID GROWTH, RAPID LIBERALIZATION, REAL GDP, REAL INCOME, REGIONAL TRADE, REGIONAL TRADE AGREEMENTS, SAVINGS, SHARE OF CAPITAL, SKILLED WORKERS, STRUCTURAL CHANGE, SUB-SAHARAN AFRICA, TARIFF DATA, TARIFF REDUCTION, TAX, TAX CONCESSIONS, TERMS OF TRADE, TERMS-OF-TRADE EFFECT, TOTAL EXPORTS, TOTAL FACTOR PRODUCTIVITY, TOTAL IMPORTS, TOURISM, TRADE DATA, TRADE DISTORTIONS, TRADE EFFECTS, TRADE FACILITATION, TRADE FLOWS, TRADE LIBERALIZATION, TRADE LOSS, TRADE LOSSES, TRADE MODELS, TRADE PATTERNS, TRADE POLICIES, TRADE POLICY, TRADE POLICY ANALYSIS, TRADE POLICY REVIEW, TRADE REFORM, TRADE REGIMES, TRADE VOLUME, TRADING PARTNER, TRADING PARTNERS, TRANSPORT COSTS, UNCERTAINTY, UNSKILLED LABOR, URUGUAY ROUND, VALUE ADDED, VOLUME OF TRADE, WELFARE LOSS, WORLD DEVELOPMENT INDICATORS, WORLD ECONOMY, WORLD TRADE, WORLD TRADE ORGANIZATION, WTO,
Online Access:	http://documents.worldbank.org/curated/en/2007/08/8186905/china-india-future-world-economy-fierce-competition-or-shared-growth https://hdl.handle.net/10986/7297
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