Economics & Development
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Documents in Economics & Development
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Chinaโs export performance is characterized by two striking features: a steady rise in export sophistication and the continued prominence of less sophisticated products. This paper proposes the โMany Chinasโ hypothesis, that Chinaโs provinces differ in their comparative advantage and in how this comparative advantage has evolved over time. Using detailed Chinese customs export data from 1995 to 2023, this paper investigates the provincial underpinnings of Chinaโs export performance. Three main findings emerge. First, export similarity between Chinese provinces and the advanced economies increased over time, initially more rapidly in the eastern provinces. Second, despite this increased export similarity with the advanced countries, there remained significant heterogeneity across provinces in 2023. In their export structure, provinces such as Shanghai and Jiangsu resemble most closely the Republic of Korea while Guangdong and Shanxi resemble Viet Nam and the Philippines, respectively. Third, this paper identifies a novel pattern: during the first decade after Chinaโs World Trade Organization accession in 2001, the export sophistication of the countryโs eastern provinces increased much faster than that of other provinces, but since about 2010, there has been remarkable convergence in sophistication across all provinces.