nep-cna New Economics Papers
on China
Issue of 2013‒05‒24
two papers chosen by
Zheng Fang
Ohio State University

  1. Mobility in China By Yi Chen; Frank A Cowell
  2. Going global: markups and product quality in the Chinese art market By Jennie Bai; Jia Guo; Benjamin Mandel

  1. By: Yi Chen; Frank A Cowell
    Abstract: We examine the evidence on rank and income mobility in China during the decades immediately preceding and immediately following the millennium using panel data from the China Health and Nutrition Survey. We show that rank mobility changed markedly over the period: in this respect China is becoming markedly more rigid. By contrast income mobility has carried on increasing; so has income inequality.
    Keywords: Mobility Measurement, Income Distribution
    JEL: D63
    Date: 2013–04
  2. By: Jennie Bai; Jia Guo; Benjamin Mandel
    Abstract: We analyze two reasons for export prices to be different across markets--namely, quality differentiation and variable markups--and attempt to parse their relative importance and some of their underlying drivers. To overcome the substantial measurement issues in this task, we consider a particular industry as a special case: Chinese fine art. The simplicity of the supply side of art vis-á-vis marginal cost and the wealth of data on its quality characteristics make it possible to separately identify the markup and quality components of international relative prices for Chinese artworks. Through this lens, we trace the process of growth and internationalization of Chinese art since the year 2000. We find strong support for quality sorting into international markets at both the level of artist and artwork, as well as substantial markup differences across destinations. Using a structural model of endogenous quality choice by Feenstra and Romalis (2012), we argue that much of the international quality premium is driven by per unit distribution costs (whether physical or informational) rather than destination-specific preferences for quality.
    Keywords: Exports - China ; Prices ; International trade ; Supply and demand
    Date: 2013

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