## Trade Implications of China's Subsidies

_IMF Working Papers, August 23, 2024_

## Source details

**Canonical URL:** [Trade Implications of China's Subsidies](https://www.imf.org/en/publications/wp/issues/2024/08/15/trade-implications-of-china-s-subsidies-552506)

## Other formats

- [Markdown version](/en/publications/wp/issues/2024/08/15/trade-implications-of-china-s-subsidies-552506/index.md)
- [Structured JSON version](/en/publications/wp/issues/2024/08/15/trade-implications-of-china-s-subsidies-552506/index.json)
- [Bundle manifest](/en/publications/wp/issues/2024/08/15/trade-implications-of-china-s-subsidies-552506/bundle-manifest.json)

## Bibliographic details
- Authors: Lorenzo Rotunno, Michele Ruta
- Published: August 23, 2024
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400282478.001

---

### Summary of study and scope
- Available data show a marked increase in subsidy utilization in China and in other major economies between 2009 and 2022.
- The paper investigates effects of China's subsidies on international trade flows at the product level over the period 2009–2022.
- Analysis includes product-level trade flows, supply-chain linkages, and decomposition into price and quantity effects.

### Main empirical findings
- Subsidies promoted Chinese exports and limited imports.
- Supply-chain linkages magnify effects: subsidies given to upstream industries expand significantly the exports of downstream industries.
- Price and quantity decomposition at the product level:
  - China's subsidies lowered export prices and boosted export quantities in certain sectors, including:
    - metal products
    - furniture
    - autos
  - In other sectors, evidence is more consistent with quality upgrading rather than price-driven volume expansion, notably:
    - electrical machinery

### Subject areas and keywords
- Subject: Export prices, Export subsidies, Exports, Imports, International trade, Prices
- Keywords: China, China's subsidy, Domestic subsidies, Export prices, Export subsidies, Exports, exports of downstream industry, Global, Imports, International trade, metal products, Overcapacity, Spillovers, supply-chain linkage, trade implication

*IMF Working Paper: "Trade Implications of China's Subsidies" by Lorenzo Rotunno and Michele Ruta, Working Paper No. 2024/180 (43 pages), DOI: https://doi.org/10.5089/9798400282478.001.*

---

## Content in this bundle

- **Working Paper**
  - [Working Paper (Markdown version)](/-/media/files/publications/wp/2024/english/wpiea2024180-print-pdf.pdf.md){rel="alternate" type="text/markdown"}
  - [Working Paper (PDF)](/-/media/files/publications/wp/2024/english/wpiea2024180-print-pdf.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/wp/issues/2024/08/15/trade-implications-of-china-s-subsidies-552506_