Multinational Exposure and the Quality of New Chinese Exports

We exploit information on the geographic, product and trader characteristics of China's 1997–2009 exports to examine how the evolving city‐industry presence of multinational firms influenced the quality, frequency and survival of new export transactions by private Chinese firms. Our results show that own‐industry multinational firm contact was associated with more frequent, higher‐valued, and longer‐lasting new trade transactions. These effects appear to arise from beneficial multinational spillovers, rather than selection effects due to increased multinational competition, as increases in own‐industry or other multinational presence were also associated with an increase in the number of trade transactions introduced by private Chinese firms.