Imports from China as a driver of economic growth in Latin American countries
Description
In 1990, the participation of China in the global imports of Latin America (LAC) was incipient, while by 2019, China had become the second largest supplier of the region. This paper uses a sample of 14 LAC countries, estimates the effects of imports from China on each LAC country's economic growth, and verifies if these effects are evidenced in the non-exporting or exporting sectors of these countries. We estimate a Seemingly-Unrelated-Regressions (SUR) system for each sector. Results show that before China entered into World Trade Organization (WTO), LAC imports from China positively affected the economic growth of some LAC countries. However, the number of beneficiary countries increased after China´s adhesion to WTO. Imports from China drive the economic growth of the non-exporting sectors of Argentina, Costa Rica, Ecuador, and El Salvador, the exporting sector of the Dominican Republic, and both sectors of Brazil, Chile, Colombia, Peru, Uruguay, and Venezuela. Except for the Dominican Republic, the countries that export sectors benefit from China's imports are primary exporting countries. Adverse or null effects are estimated for the rest of the countries.
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Steps to reproduce
The instructions can be found in the file: "Instructions Letter", inside the folder: "Instructions". The stata codes can be found in the files: DO FILE A, DO FILE B and, DO FILE C; inside the folder: "Stata codes" The data set can be found in the files: DATASET 1 and DATASET 2; inside the folder: Dataset