China experienced dramatic growth throughout its entire economy during the 1978 to 2008 period. This significant economic expansion may be attributed to China’s open policy after its 1978 overall economic reform. Our inter-temporal analysis of China’s export growth between 1978 and 2008, based on the statistical stochastic decomposition approach, indicates that, in the first ten years afterChina’s trade openness, most of its export growth occurred in the extensive margin of trade, but later most of China’s export growth appeared in existing varieties or the intensive margin of trade. We find that the distribution of the extensive margin is more dispersed than of the intensive margin, as we use the country-product approach. After applying formal tests, the results show that the intensive margin plays a significant role in the growth of China’s exports.
