Abstract
This paper examines the impact of trade liberalization on robot adoption in manufacturing products exported to China (MPEC) by partner countries, using Chinese Free Trade Agreements (CFTAs) as quasi-experiments. Empirical analyses show that the removal of trade barriers and the subsequent increase in bilateral trade flows following the implementation of CFTAs boosted robot adoption in partner countries' MPEC. Notably, this effect is stronger for non-automotive sectors, developing countries with lower technology capacity, countries focusing on downstream-oriented production, and those with lower transportation costs to China. Moreover, we demonstrate that increased export concentration on China is the primary channel through which partners reorganize production and increase market-oriented robot adoption in MPEC, supporting the export diversion effect of trade liberalization rather than the export creation effect of CFTAs. Beyond tariff reductions, the enforceable WTO + X and WTO-X provisions under CFTAs contribute to robot adoption in MPEC. These findings shed light on how trade liberalization influences manufacturing reorganization toward automation and its potential benefits for partner countries.