HSBC Business School
Institutional Affiliation: Peking University
NBER Working Papers and Publications
|June 1998||The US-China Bilateral Trade Balance: Its Size and Determinants|
with Robert C. Feenstra, Wing T. Woo, Shunli Yao: w6598
This paper has two aims. The first is to reduce the range within which the true U.S.-China bilateral trade deficit lies. The second is to identify the determinants of the bilateral trade deficit and offer an assessment of their relative importance. We calculate a smaller range of values for the bilateral trade deficit than in previous studies, due to a new estimation method that takes advantage of our access to detailed Chinese Customs data at the commodity level. For example, the revised US-China bilateral trade deficit is $15 billion to $20 billion in 1994, and $16 billion to $22 billion in 1995, compared to the official range of $8 billion to $30 billion, and $9 billion to $34 billion, respectively. The widening of the US-CHINA bilateral trade deficit in recent years reflected many...