NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Value of Information in International Trade: Gains to Outsourcing through Hong Kong

Robert C. Feenstra, Gordon H. Hanson, Songhua Lin

NBER Working Paper No. 9328
Issued in November 2002
NBER Program(s):   ITI   PR

In this paper, we estimate the benefits to countries that purchase goods from China of having access to intermediary services provided by Hong Kong. Traders in Hong Kong supply information on markets and producers in China, which provides welfare gains to foreign firms using these services. During the 1990s, Hong Kong intermediated about half of the goods that China exported to the rest of the world. Our results suggests that gains to intermediary services provided by Hong Kong equal 16% of the value of goods that China exports to other countries through Hong Kong, and range between 10% and 21% of this export value for various manufacturing goods and across different years.

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Document Object Identifier (DOI): 10.3386/w9328

Published: Robert Feenstra & Gordon Hanson & Songhua Lin. 2004. "The Value of Information in International Trade: Gains to Outsourcing through Hong Kong," Advances in Economic Analysis & Policy, Berkeley Electronic Press, vol. 4(1), page 1071

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