nep-cna New Economics Papers
on China
Issue of 2008‒08‒21
four papers chosen by
Zheng Fang
Ohio State University

  1. Macroeconomic Linkages between Hong Kong and Mainland China By He, Dong
  2. The Ripple that Drowns? Twentieth-century famines in China and India as economic history By Cormac Ó Gráda
  3. Non-Performing Loans and Productivity in Chinese Banks: 1997-2006 By Matthews, Kent; Guo, Jianguang; Zhang, Nina
  4. Testing urbanization economies in manufacturing industries: urban diversity or urban size? By Fu, Shihe; Hong, Junjie

  1. By: He, Dong
    Abstract: This paper provides a non-technical summary of ten HKMA research papers grouped together under the theme of "macroeconomic linkages between Hong Kong and Mainland China". A common message coming out of the analysis is that Hong Kong has primarily served as a gateway of trade and financial flows between the Mainland and the rest of the world, and Hong Kong’s cyclical conditions are very much tied to fluctuations in the volume of flows of goods, services and capital between the Mainland and its major trading partners. Such a “bridge” role is likely to remain important for Hong Kong’s economic future, even though trade and financial flows that are more closely linked to developments in domestic demand on the Mainland will gain increasing significance. This paper also serves as the introductory chapter of the book entiled "Macroeconomic Linkages between Hong Kong and Mainland China", by Hans Genberg and Dong He, which is published by the City University of Hong Kong Press (ISBN: 978-962-937-161-6)
    JEL: F15 F21
    Date: 2008–07
  2. By: Cormac Ó Gráda (University College of Dublin)
    Date: 2007–11–24
  3. By: Matthews, Kent (Cardiff Business School); Guo, Jianguang; Zhang, Nina
    Abstract: This study examines the productivity growth of the nationwide banks of China over the ten years to 2006. Using a bootstrap method for the Malmquist index estimates of productivity growth are constructed with appropriate confidence intervals. The paper adjusts for the quality of the output by accounting for the non-performing loans on the balance sheets and test for the robustness of the results by examining alternative sets of outputs. The productivity growth of the state-owned banks is compared with the Joint-stock banks and it determinants evaluated. The paper finds that average productivity of the Chinese banks improved modestly over this period. Adjusting for the quality of loans, by treating NPLs as an undesirable output, the average productivity growth of the state-owned banks was zero or negative while productivity of the Joint-Stock banks was markedly higher.
    Keywords: Bank Efficiency; Productivity; Malmquist index; Bootstrapping
    JEL: D24 G21
    Date: 2007–11
  4. By: Fu, Shihe; Hong, Junjie
    Abstract: Whether urbanization economies are caused by urban diversity or urban scale is not clear in regional and urban economics literature. Many empirical studies have used either city population size or urban industrial diversity to measure urbanization economies and have reached different conclusions. This paper argues that city size mainly captures the pure scale economies of urban public goods, and may generate net diseconomies when a city size is too large. Urban industrial diversity can also enhance firm productivity. Using the 2004 China manufacturing census data, we test simultaneously the effects of urban size and industrial diversity on firm productivity, controlling for localization economies and human capital externalities. We found that city size effect does exist, but too large a city size indicates net diseconomies. Firms also benefit from industrial diversity, and the strength of such benefit increases with city size but decreases with firm size. The overall results support Jacobs's idea that small firms benefit more from urban diversity.
    Keywords: Urbanization economies; Industrial diversity; Jacobs externalities; City size
    JEL: R30 R12 L60
    Date: 2008–08

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