nep-cna New Economics Papers
on China
Issue of 2007‒10‒06
six papers chosen by
Zheng Fang
Ohio State University

  1. Electronics Production Upgrading: Is China Exceptional? By Ari Van Assche; Byron Gangnes
  2. Facts and Fallacies about U.S. FDI in China By Lee Branstetter; C. Fritz Foley
  3. Economic-Social Interaction in China By Lindbeck, Assar
  4. The Direct Effect of China on Canadian Consumer Prices: An Empirical Assessment By Louis Morel
  5. Reconciling Trade Statistics from China, Hong Kong and Their Major Trading Partners--A Mathematical Programming Approach By Wang, Zhi; Gehlhar, Mark; Yao, Shunli
  6. Is China’s Growth Sustainable? By James Roumasset; Kimberly Burnett; Hua Wang

  1. By: Ari Van Assche (HEC Montr´eal and CIRANO); Byron Gangnes (University of Hawaii at Manoa)
    Abstract: In this paper, we make use of a unique world electronics production data set to assess China’s upgrading trajectory in the global electronics industry. Contrary to existing studies, we find no evidence that China’s electronics production activities are more sophisticated than one would expect from its level of development. We also find little evidence that China is rapidly upgrading into more sophisticated production activities.
    Keywords: China, industrial upgrading, electronics
    JEL: O10 O14 L63
    Date: 2007–08–17
  2. By: Lee Branstetter; C. Fritz Foley
    Abstract: Despite the rapid expansion of U.S.-China trade ties, the increase in U.S. FDI in China, and the expanding amount of economic research exploring these developments, a number of misconceptions distort the popular understanding of U.S. multinationals in China. In this paper, we seek to correct four common misunderstandings by providing a statistical portrait of several aspects of U.S. affiliate activity in the country and placing this activity in its appropriate economic context.
    JEL: F14 F23 O19 O32
    Date: 2007–10
  3. By: Lindbeck, Assar (Research Institute of Industrial Economics (IFN))
    Abstract: This paper analyzes economic-social interaction in China in connection with the country’s change of economic system. I define an economic system in terms of a multidimensional vector of broad institutional characteristics, and I emphasize that important features of the social development are closely related to specific changes in these various dimensions. I classify China’s options for future social improvements into three broad categories: policies that improve the stability and distribution of factor income; government-created wedges between factor income and disposable income; and improvements in the quantity, quality and distribution of human services, such as education and health care.
    Keywords: China; Economic transition; Typology of economic systems; Social reforms
    JEL: H00 I00 P20
    Date: 2007–09–28
  4. By: Louis Morel
    Abstract: The author investigates the direct effect of Chinese imported goods on consumer prices in Canada. On average, over the 2001-06 period, the direct effect of consumer goods imported from China is estimated to have reduced the inflation rate by about 0.1 percentage points per year. This disinflationary effect is due to two causes: first, the Chinese share of Canadian imports of consumer goods has been increasing rapidly in recent years, and second, the price of these goods is much lower in China than it is among Canada's other import sources, as well as domestic producers. Chinese goods will continue to have a disinflationary impact on Canadian prices as long as the price of these goods remains lower than what can be produced in Canada, or by other trading partners, and as long as the Chinese share of Canadian imports continues to increase.
    Keywords: Inflation and prices
    JEL: E31
    Date: 2007
  5. By: Wang, Zhi; Gehlhar, Mark; Yao, Shunli
    Abstract: This paper develops a mathematical programming model to simultaneously estimate re-export markups and reconcile bilateral trade statistics between China, Hong Kong, and their trading partners. The model is applied to sector level trade flows to resolve discrepant reporting in an efficient manner. Adjustments in trade flows are based upon statistical reporters' reliability information. The program is implemented in GAMS and retains many desirable theoretical and empirical properties. Estimates are used for generating trade flows and markups for Hong Kong's re-exports used in the forthcoming version 7 GTAP database. The model's flexibility has potential for expanded use in other regions where re-exports and associated markup cause discrepant trade flows.
    Date: 2007
  6. By: James Roumasset (Department of Economics, University of Hawaii at Manoa); Kimberly Burnett (Department of Economics, University of Puget Sound); Hua Wang (World Bank)
    Abstract: A central pillar of the sustainability movement is the call to include environmental accounting in standard measures of economic performance. This increased transparency would, in principle, mitigate the temptation of economic managers and policy makers to increase growth in material consumption at the expense of the environment. Moreover, as Repetto (1989) and others have argued, deducting depreciation of produced capital from NNP but not deducting depreciation of natural capital is inconsistent and debases NNP as a possible indicator of welfare. Based on the evidence available, it appears that while GNNP is substantially less than NNP, these adjustments do not adversely compromise existing estimates of economic growth for China.
    Keywords: sustainable development, China, genuine saving, SOx, NOx, TSP, resource depletion, natural capital, Environmental Kuznets Curve, green net national product
    JEL: O13 Q01 Q2 Q3 Q4 Q5
    Date: 2007–09–23

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