The role evolution of textile industry in China’s economy during 2002–2020: an input-output analysis

Abstract

This paper uses the input-output (I-O) model to evaluate industry linkages and industry spread of China’s textile industry (CTI) to investigate the role evolution of CTI in China’s economy during 2002–2020. The research results show that: (1) the role of CTI in China’s economy is on a declining trend and its share in the industrial sectors is shrinking; (2) CTI has long and high backward linkages with the upstream agriculture, chemistry and wholesale & retail and high forward linkages with the downstream garment, papermaking and culture, chemistry and health; these connections are becoming closer and closer; (3) the power of dispersion and the power of dispersion index of CTI has been greater than the sensitivity of dispersion and sensitivity of dispersion index for a long time; it indicates that CTI is still the sector that drives China’s economic growth; (4) the final demand effect shows CTI has always been the most dependent on net exports, followed by consumption and investment and it’s still an export-oriented industry. Finally, some relevant policy suggestions are put forward.