Is China Unfairly Blamed for Global Inflation?

With inflation on the march around the globe, the links between prices of
goods in different countries are now getting lots of attention. Low-priced
products from China have been given some of the credit for low global inflation
in years past, but higher costs for labor and materials in China are also
getting some of the blame for the current rise in prices.

Imports constitute around 15% of U.S. GDP and around 13% of that comes from
China,” the authors write in an article in the latest issue of China & World
Economy, an English-language journal published by the Chinese Academy for
Social Sciences. On their back-of-the-envelope calculation, that means a 1
percentage point increase in China’s inflation rate should lead to an increase
in U.S. inflation of 0.02 to 0.03 percentage points.

“It is estimated that something like half of total imports would need to
come from China for a 1% Chinese price increase to translate into a very
moderate 0.1% price increase in Japanese and U.S. prices,” the authors write.
“For any noticeable effect on inflation, China would need to dominate
international trade on a large scale.”

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This Article Takes up for China in regards to China being blamed for large scale global inflation problems.

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