China's role in our global economy: Contributions from generalized trade

Abstract

AbstractAs the world's second largest economy, China plays an important role in our global trade. As a rule, however, more attention is paid to trade in barter or currency form rather than to virtual modes, such as virtual‐water, ‐energy, ‐land, and‐labor trade, in spite of the fact that the latte can also be crucial. Previous studies focused on one single form and could not get a comprehensive understanding of trade. A term of generalized trade was applied when taking all these trades into consideration. This paper aimed to investigate China's role in our global trade under the generalized trade framework. Results indicate that China has been not only the largest physical trader but also one of the largest virtual traders, and its role has been even more essential than expected when considering both physical and virtual trade. In practice, generalized trade would occur in other economies, which should shift additional attention from traditional physical trade to generalized trade when building our community with a shared future for mankind.