TY  - JOUR
AU  - Khandelwal,Amit K.
AU  - Schott,Peter K.
AU  - Wei,Shang-Jin
TI  - Trade Liberalization and Embedded Institutional Reform: Evidence from Chinese Exporters
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17524
PY  - 2011
Y2  - October 2011
UR  - http://www.nber.org/papers/w17524
L1  - http://www.nber.org/papers/w17524.pdf
N1  - Author contact info:
Amit Khandelwal
Graduate School of Business
Columbia University
Uris Hall 606, 3022 Broadway
New York, NY 10027
Tel: 212/854-7506
Fax: 212/316-9219
E-Mail: ak2796@columbia.edu

Peter K. Schott
Yale School of Management
135 Prospect Street
New Haven, CT 06520-8200
Tel: 203/436-4260
Fax: 203/432-6974
E-Mail: peter.schott@yale.edu

Shang-Jin Wei
Graduate School of Business
Columbia University
Uris Hall 619
3022 Broadway
New York, NY 10027-6902
Tel: 212/854-9139
E-Mail: shangjin.wei@columbia.edu
AB  - If trade barriers are managed by inefficient institutions, trade liberalization can lead to greater-than-expected gains. We examine Chinese textile and clothing exports before and after the elimination of externally imposed export quotas. We find that the surge in export value and decline in export prices following quota removal is driven by net entry, and show that this dominance is inconsistent with use of a productivity-based allocation of quota licenses by the Chinese government. Our counterfactual implies that elimination of misallocated quotas raised the overall productivity gain of quota removal by 28 percent.
ER  -