nep-cna New Economics Papers
on China
Issue of 2014‒07‒05
six papers chosen by
Zheng Fang
Ohio State University

  2. Made in China, sold in Norway: Local labor market effects of an import shock. By Balsvik, Ragnhild; Jensen, Sissel; Salvanes, Kjell G.
  3. Restructuring China’s Research Institutes: Impacts on China’s Research Orientation and Productivity By Daniel L.Tortorice; Gary H. Jefferson; Renai Jiang
  4. Preferential Market Access into the Chinese Market: How Good is it for Africa? By Catherine Yap Co; Ralitza Dimova
  5. Oil Price Uncertainty and Sectoral Stock Returns in China: A Time-Varying Approach By Guglielmo Maria Caporale; Faek Menla Ali; Nicola Spagnolo
  6. Copper Price Discovery on Comex, the LME and the SHFE, 2001-2013 By Isabel Figuerola-Ferretti Garrigues; Chris L. Gilbert; Jieqin Yan

  1. By: Francesco Aiello; Graziella Bonanno; Alessia Via (Dipartimento di Economia, Statistica e Finanza, Università della Calabria)
    Abstract: The empirical literature on trade imbalances does not make currency tensions easy to understand, because tensions across traders originate from the assumption that export-price elasticity is high. This paper provides new evidence by analysing the export-behaviour of China, France, Germany, Italy, Japan, UK, and the USA from 1990 to 2012. Estimates of export-price elasticities have been made using panel data techniques for non-stationary data. Long run relationships are stable to any structural break and indicate that exports are heavily dependent on world income, with long run income elasticity significantly higher than unity in many cases (China, Japan, Germany, UK and USA). Conversely, exports are price inelastic for most of the countries in the sample, in both the long and short runs. The exception is France, whose exports in the long run would increase by 2 percent if the country experienced a 1 percent depreciation of its real exchange rate
    Keywords: export elasticity, competitive Devaluation, currency wars, panel data
    JEL: C23 F10 F17 F37 P33
    Date: 2014–06
  2. By: Balsvik, Ragnhild (Dept. of Economics, Norwegian School of Economics and Business Administration); Jensen, Sissel (Dept. of Economics, Norwegian School of Economics and Business Administration); Salvanes, Kjell G. (Dept. of Economics, Norwegian School of Economics and Business Administration)
    Abstract: We analyze whether regional labor markets are affected by exposure to import competition from China. We find negative employment effects for low-skilled workers, and observe that low-skilled workers tend to be pushed into unemployment or leave the labor force altogether. We find no evidence of wage effects. We partly expect this in a Nordic welfare state where firms are flexible at the employment margin, while centralized wage bargaining provides less flexibility at the wage margin. Our estimates suggest that import competition from China explains almost 10% of the reduction in the manufacturing employment share from 1996 to 2007 which is half of the effect found by Autor, Dorn and Hanson (2013) for the US.
    Keywords: Import Competition; Local Labor Markets; Norway.
    JEL: F16 H53 J23 J31
    Date: 2014–06–30
  3. By: Daniel L.Tortorice (International Business School, Brandeis University); Gary H. Jefferson (International Business School, Brandeis University); Renai Jiang (Xi'an Jiaotong University)
    Abstract: This paper evaluates the impact of the Chinese government’s initiative begun in 1999 to restructure the country’s approximately 3,500 research institutes. The paper reviews the evolution of China’s research sector over the period 1995 to 2010, identifying certain issues that are analyzed using a panel of sample research institutes. The econometric analysis is based on a balanced sample of these institutes, both converted and unconverted, spanning 1998, the year prior to the restructuring initiative, to 2005. In order to control for potential endogeneity and selection bias, the paper employs various econometric methods to evaluate the impact of the restructuring program on the performance of these institutes. We find that the restructuring program appears to have achieved its fundamental goals, that is, shifting the relevant resources toward a more commercial mission for the converted S&T enterprises and a more researchoriented mission, involving the use of government grants, for the non-profit research institutes. The results show modest gains in the efficiency of patent production, but given the lengthy gestation period, a longer duration is needed to assess how the patent production of China’s research institutes will adapt to the shift in their missions and reassignment of government resources.
    Keywords: Technological Innovation, R&D, Invention, Research Policy
    JEL: O31 O32 O33
    Date: 2014–05
  4. By: Catherine Yap Co; Ralitza Dimova
    Abstract: Abstract In 2005 China provided duty-free access to 190 items from 25 least developed sub-Saharan African (SSA) countries. Three years later duty-free access was extended to 454 items from 31 SSA LDCs. We find no evidence that China’s preferential market access program for the least developed sub-Saharan African countries has helped these countries gain competitive edge over other exporters into the Chinese market. While there is evidence of decreased export bundle concentration and movement up the value chain for SSA countries involved in the program, the effect differs significantly across countries.
    Date: 2014
  5. By: Guglielmo Maria Caporale; Faek Menla Ali; Nicola Spagnolo
    Abstract: This paper investigates the time-varying impact of oil price uncertainty on stock prices in China using weekly data on ten sectoral indices over the period January 1997-Febraury 2014. The estimation of a bivariate VAR-GARCH-in-mean model suggests that oil price volatility affects stock returns positively during periods characterised by demand-side shocks in all cases except the Consumer Services, Financials, and Oil and Gas sectors. The latter two sectors are found to exhibit a negative response to oil price uncertainty during periods with supply-side shocks instead. By contrast, the impact of oil price uncertainty appears to be insignificant during periods with precautionary demand shocks.
    Keywords: China, Oil price uncertainty, Sectoral stock returns
    JEL: C32 Q43
    Date: 2014
  6. By: Isabel Figuerola-Ferretti Garrigues; Chris L. Gilbert; Jieqin Yan
    Abstract: Over the past two decades, China has come to dominate internationalcommerce in copper. The importance of the Shanghai Futures Exchange(SHFE) has increased in response to this development. We look at thedistribution of price discovery between the SHFE and the two historicallyimportant copper futures exchanges, Comex and the LME. The resultsindicate that it is Comex, followed by the SHFE, not the LME whichplays the most important role in copper price discovery. We also highlighta number of problems associated with both the calculation andinterpretation of the standard IS and PT price discovery measures whenused to look at overlapping price change on non-synchronous markets.The results offer a clearer interpretation in terms of trading slots(European, North American and Asian trading days) than in terms ofexchanges.
    Keywords: Price discovery, Cointegration non-synchronous trading, Copper
    Date: 2014–02

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