nep-cna New Economics Papers
on China
Issue of 2014‒06‒28
five papers chosen by
Zheng Fang
Ohio State University

  1. Data for Studying Earnings, the Distribution of Household Income and Poverty in China By Gustafsson, Björn Anders; Li, Shi; Sato, Hiroshi
  2. The Nexus between Antidumping Petitions and Exports during the Global Financial Crisis: Evidence on the People’s Republic of China By Lin, Faqin; Tang, Hsiao Chink; Wang, Lin
  3. Falling Short: Intergovernmental Transfers in China By Yongzheng Liu; Jorge Martinez-Vazquez; Baoyun Qiao
  4. Who will feed China in the 21st century ? income growth and food demand and supply in China By Fukase, Emiko; Martin, Will
  5. Economic and Political Transitions from Premodern to Modern States in the Meiji Restoration and Xinhai Revolution: A Strategic Approach By Aoki, Masahiko

  1. By: Gustafsson, Björn Anders (University of Gothenburg); Li, Shi (Beijing Normal University); Sato, Hiroshi (Hitotsubashi University)
    Abstract: This paper discusses data used in publishing statistics on earnings, the distribution of household income and poverty in China by the National Bureau of Statistics (NBS) which is widely used by policy makers, international agencies and researchers. Unlike many other countries, China until recently had a dual system of household surveys - one rural and one urban. This has had consequences for providing official data on wages, income and poverty which we discuss along with other challenges. Since the end of the 1980s, researchers have been active in the construction of large databases aimed at mapping earnings, household income and poverty, and we present seven of these in the paper.
    Keywords: earnings, income, inequality, poverty, data, China, National Bureau of Statistics
    JEL: C83 D31 I32 P36
    Date: 2014–06
  2. By: Lin, Faqin (School of International Trade and Economics); Tang, Hsiao Chink (Asian Development Bank); Wang, Lin (Institute of Economics of the Chinese Academy of Social Sciences)
    Abstract: This paper quantifies how the People’s Republic of China’s (PRC) export volume to its major trading partners during the global financial crisis affects the antidumping (AD) petitions filed by the trading partners against the PRC. Focusing on the AD petitions at the Harmonized System (HS) Code 8-digit level and the PRC’s exports at the HS 2-digit level, we construct three instrument variables at the same HS level for export volume. These instruments—documents required, time taken, and container charges incurred for goods traded across borders—represent trade costs obtained from the World Bank’s Doing Business Project. We find rising exports from the PRC lead to rising AD petitions against the country. Instrumental variable estimates indicate that a 1 percentage point rise in the PRC’s export volume raises the number of AD petitions against the country by about 0.3 percentage point, and the probability of receiving AD petitions by 3.6 %. These estimates are about 10 times larger than those found in ordinary least square regressions. Their quantitative significance underlines why it is important to consider the issue of export endogeneity in the estimation. Moreover, it highlights the failure of the current trade statistics to account for the true value-added of traded goods, and how this has particularly disadvantaged the PRC, given its position as the factory of the world.
    Keywords: International trade; antidumping; instrument variable; People’s Republic of China
    JEL: F13 F14 F59
    Date: 2014–05–01
  3. By: Yongzheng Liu (School of Finance Renmin, University of China); Jorge Martinez-Vazquez (International Center for Public Policy. Andrew Young School of Policy Studies, Georgia State University); Baoyun Qiao (China Academy of Public Finance and Policy, Central University of Finance and Economics)
    Abstract: The main objective of the paper is to propose a framework in which fiscal health conditions can be assessed and the main determinants affecting fiscal health can be identified, inspite of severe data constraints. The paper draws on big urban agglomerations in India as well as smaller cities as a sample and attempts to identify the difference, if any, in the main determinants for variations in fiscal health conditions across different size classes of cities. To compensate for the lack of statistical rigor in the estimations of expenditure needs and revenue capacities, we propose a framework which analyses the ratio of expenditure needs to revenue capacity by fitting an econometric model. It is a two-step method, in the first stage we estimate the expenditure need and revenue capacity separately by simple methods discussed above. In the second stage we take the ratio of expenditure need and revenue capacity as an indicator of financial performance of a ULB and fit an econometric model to explain the performance of ULBs on the basis of factors which are likely to affect the performance of the ULBs. We find that the role of the higher tiers of the government is important in bigger and smaller size class of cities in their financial management. However, for bigger cities we find that the own source revenues can also play an important role in bringing down the fiscal ratio. In the smaller ULBs the role of the demand indicators is not that prominent but the cost indicators play a relatively prominent role. In case of bigger agglomerations, the demand indicators are more prominent than the cost indicators.
    Date: 2014–05–27
  4. By: Fukase, Emiko; Martin, Will
    Abstract: This paper uses resource-based cereal equivalent measures to explore the evolution of China's demand and supply for food. Although demand for food calories is probably close to its peak level in China, the ongoing dietary shift to animal-based foods, induced by income growth, is likely to impose considerable pressure on agricultural resources. Estimating the relationship between income growth and food demand with data from a wide range of countries, China's demand growth appears to have been broadly similar to the global trend. On the supply side, output of food depends strongly on the productivity growth associated with income growth and on the country's agricultural land endowment, with China appearing to be an out-performer. The analyses of income-consumption-production dynamics suggest that China's current income level falls in the range where consumption growth outstrips production growth, but that the gap is likely to begin to decline as China's population growth and dietary transition slow down. Continued agricultural productivity growth through further investment in research and development, and expansion in farm size and increased mechanization, as well as sustainable management of agricultural resources, are vital for ensuring that it is primarily China that will feed China in the 21st century.
    Keywords: Food&Beverage Industry,Economic Theory&Research,Rural Development Knowledge&Information Systems,Livestock and Animal Husbandry,Regional Economic Development
    Date: 2014–06–01
  5. By: Aoki, Masahiko (Asian Development Bank Institute)
    Abstract: Economists often identify a reduction in the share of agricultural employment as a quantitative indication of the economic growth of nations. But this process did not occur in earnest in the People’s Republic of China until the 1980s and to some extent in Japan until well into the mid-20th century. Were extractive political regimes, commonly regarded as the primary drivers of economic performance, solely responsible for the lateness of these developments? This paper deals with this question from a strategic perspective by examining the interactions between the polity and the economy in both countries. It begins by characterizing the complementary nature of the peasant-based economy and the agrarian-tax state in premodern China and Japan. It then describes how endogenous strategic forces evolved from among the intermediate organizations in each country to challenge the incumbent dynastic ruler in response to the commercialization of the peasant-based economy on one hand and the fiscal and military weakening of the agrarian-tax state on the other. The paper then introduces a three-person game model between a ruler and two challenging organizations, and derives conditions for multiple equilbria and their comparative static. The analytical results help to identify the endogenous strategic forces that led the Meiji Restoration and the Xinhai Revolution to move from a premodern state of play to nation-state building and modern economic regimes in each country.
    Keywords: endogenous institutional change; institutional complementarity; Chinese economy; Meiji Restoration; tax state; peasant-based economy; three person politico-economic game
    JEL: B52 C72 N40 N45 O10 P51
    Date: 2014–06–19

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