nep-cna New Economics Papers
on China
Issue of 2016‒03‒17
six papers chosen by
Zheng Fang
Ohio State University

  1. China's Family Planning Policies and Their Labor Market Consequences By Wang, Fei; Zhao, Liqiu; Zhao, Zhong
  2. Economic growth and particulate pollution concentrations in China By David I. Stern; Donglan Zha
  3. Ownership Restructuring and Wage Inequality in Urban China By Whalley, John; Xing, Chunbing
  4. China’s Belt and Road Initiative: Motives, Scope, and Challenges By Simeon Djankov; Cullen S. Hendrix; Robert Z. Lawrence; Sean Miner; Edwin M. Truman; Fredrick Toohey
  5. Is there a difference between domestic and foreign risk premium? The case of China Stock Market By Frédéric Teulon; Khaled Guesmi; Salma Fattoum
  6. Circadian Rhythms, Sleep and Cognitive Skills: Evidence from an Unsleeping Giant By Giuntella, Osea; Han, Wei; Mazzonna, Fabrizio

  1. By: Wang, Fei (Renmin University of China); Zhao, Liqiu (Renmin University of China); Zhao, Zhong (Renmin University of China)
    Abstract: China initiated its family planning policy in 1962 and one-child policy in 1980 and allows all couples to have two children as of 1st January, 2016. This paper systematically examines the labor market consequences of China's family planning policies. First, we briefly review the major historical evolution of China's family planning policies. Second, we investigate the effects of these policies on the labor market, focusing on the size and quality of the working-age population and its age and gender composition and paying special attention to regional as well as rural-urban differences in the demographic structure resulting from the interaction of the family planning policies and internal migration. Last, we discuss undergoing and prospective policy changes and potential consequences. Though urban areas and coastal provinces have implemented stricter family planning policies, our analysis shows that because of internal migration, the aging problem is more severe in rural areas and in inland provinces. Our simulation results further indicate that the new two-child policy may be too late and too little to alleviate the aging problem in China.
    Keywords: One-Child Policy, aging, sex ratio, quantity–quality model, migration
    JEL: J13 J11 J21 J61
    Date: 2016–02
  2. By: David I. Stern (Crawford School of Public Policy, The Australian National University); Donglan Zha (College of Economics and Management, Nanjing University of Aeronautics and Astronautics)
    Abstract: Though the environmental Kuznets curve (EKC) was originally developed to model the ambient concentrations of pollutants, most subsequent applications have focused on pollution emissions. Yet, it seems more likely that economic growth could eventually reduce the concentrations of local pollutants than emissions. We examine the role of income, convergence, and time related factors in explaining recent changes in PM 2.5 and PM 10 particulate pollution in 50 Chinese cities using new measures of ambient air quality that the Chinese government has published only since the beginning of 2013. We use a recently developed model that relates the rate of change of pollution to the growth of the economy and other factors as well as the traditional environmental Kuznets curve model. Pollution fell sharply from 2013 to 2014. We show that economic growth, convergence, and time effects all served to lower the level of pollution. The results also demonstrate the relationship between the two modeling approaches.
    Keywords: air pollution; economic growth; environmental Kuznets curve; China
    JEL: O44 P28 Q53 Q56
    Date: 2016–02
  3. By: Whalley, John (University of Western Ontario); Xing, Chunbing (Beijing Normal University)
    Abstract: Within urban income inequality has become an increasingly important component in China's overall income inequality in recent years. Using three Chinese urban household surveys for 1995, 2002, and 2007, we examine how the change in ownership structure, one of the major changes in China's transition process, has contributed to China's rising within urban wage inequality. We show that the private sector had higher wage dispersion than the public sector in the period 1995-2007 and that the wage dispersion increased faster in the public sector. Decomposition exercises that follow show that over 50% of the increase in urban wage inequality was associated with labor being reallocated from the public to the private sector. Increases in wage dispersions within different ownerships (in particular the public sector) also make significant contributions to growing inequality. Counterfactual analysis indicates that the urban wage inequality may rise further if more labor is reallocated to the private sector in the future.
    Keywords: ownership, wage inequality, urban China, decomposition
    JEL: J31 I24
    Date: 2016–02
  4. By: Simeon Djankov (Peterson Institute for International Economics); Cullen S. Hendrix (Peterson Institute for International Economics); Robert Z. Lawrence (Peterson Institute for International Economics); Sean Miner (Peterson Institute for International Economics); Edwin M. Truman (Peterson Institute for International Economics); Fredrick Toohey (Peterson Institute for International Economics)
    Abstract: China’s commercial ties with the outside world have long been symbolized by the ancient Silk Road, which began as a tortuous trading network of mountain paths and sea routes that provided a lifeline for the Chinese economy. Now the leadership in Beijing is reviving the concept with an ambitious plan to build and upgrade highways, railways, ports, and other infrastructure throughout Asia and Europe designed to enrich the economies of China and some 60 of its nearby trading partners. The so-called Belt and Road Initiative has generated enthusiasm and high hopes but also skepticism and wariness. And as big as China’s ambitions are, many obstacles stand in the way. In this volume of essays edited by Sean Miner and Simeon Djankov, PIIE experts analyze the initiative’s opportunities for China and the world, along with the logistical problems and political, economic, and security implications that have generated concerns.
  5. By: Frédéric Teulon; Khaled Guesmi; Salma Fattoum
    Date: 2016–02–18
  6. By: Giuntella, Osea (University of Oxford); Han, Wei (University of Oxford); Mazzonna, Fabrizio (USI Università della Svizzera Italiana)
    Abstract: This paper analyzes the effects of sleep duration on cognitive skills and depression symptoms of older workers in China. Cognitive skills and mental health have been associated with sleep duration and are known to be strongly related to economic behavior and performance. However, causal evidence is lacking and little is known about sleep deprivation in developing countries. We exploit the relationship between circadian rhythms and bedtime to identify the effects of sleep using sunset time as an instrument. Using the Chinese Health and Retirement Longitudinal Study, we show that a later sunset time reduces significantly sleep duration and that sleep duration increases cognitive skills and eases depression symptoms of workers aged over 45 years. The results are driven by employed individuals living in urban areas, who are more likely to be constrained by rigid working schedules. On the contrary, we find no evidence of significant effects on self-employed and farmers.
    Keywords: sleep deprivation, cognitive skills, risky behaviors
    JEL: I12
    Date: 2016–02

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