nep-cna New Economics Papers
on China
Issue of 2017‒01‒22
nine papers chosen by
Zheng Fang
Ohio State University

  1. China - HP-SSST: Last Part of Growing Pains? By Dukgeun Ahn; Maurizio Zanardi
  2. Labor unrest and incipient collective bargaining in China By Sarosh Kuruvilla; Hao Zhang
  3. Banks as corporate monitors: Evidence from CEO turnovers in China By He, Qing; Huang, Jiyuan; Li, Dongxu; Lu, Liping
  4. Do International Investors Cause Stock Market Comovements? Comparing Responses of Cross-Listed Stocks between Accessible and Inaccessible Markets By Yusaku Nishimura; Yoshiro Tsutsui; Kenjiro Hirayama
  5. What shapes social attitudes toward corruption in China? Micro-level evidence By Fungáčová, Zuzana; Määttä, Ilari; Weill, Laurent
  6. Does corporate governance matter in fund management company: the case of china By Mamatzakis, Emmanuel; Xu, Bingrun
  7. Chinese Foreign Exchange Reserves, Policy Choices and the U.S. Economy By Neely, Christopher J.
  8. Quantifying the Spillovers from China Rebalancing Using a Multi-Sector Ricardian Trade Model By Rui Mano
  9. Myanmar's cross-border trade with China : beyond informal trade By Kubo, Koji

  1. By: Dukgeun Ahn; Maurizio Zanardi
    Abstract: In December 2012 Japan requested the establishment of a World Trade Organization (WTO) Panel regarding AD duties that China had imposed on high-performance stainless steel seamless tubes (HP-SSST). The European Union joined as a complainant in June 2013. To some degree, this dispute follows earlier ones involving China, as similar procedural and substantial issues were raised in previous cases. However, this is the first time that the WTO Panel rejected some important claims, only for those decisions to be reversed by the Appellate Body. Now that various rulings have clarified these legal issues, it remains to be seen if HP-SSST represents the last part of growing pains for Chinese authorities to learn about AD legal procedures.
    Keywords: Antidumping, WTO trade disputes, impact analysis, essential fact, price undercutting, non-attribution, China
    JEL: F13 K33
    Date: 2016–09
  2. By: Sarosh Kuruvilla; Hao Zhang
    Abstract: In this paper, we argue that both labor unrest and collective bargaining are increasing in China. Using McAdam’s political process theory, we argue that Chinese workers are striking more and offensively in support of their economic demands. We identify the state’s interests in promoting collective bargaining, and through an analysis of union and employers organizations, attempt to predict the future trajectory of collective bargaining in China. Using new data about strikes, we confirm our argument that strikes in China are increasing. Based on very limited past and current research, we create a taxonomy of baseline collective bargaining in China against which future developments can be compared.
    Keywords: collective bargaining; employment relations; strikes
    JEL: N0 R14 J01 J50
    Date: 2016–04–01
  3. By: He, Qing; Huang, Jiyuan; Li, Dongxu; Lu, Liping
    Abstract: ​This paper examines the governance role of banks in replacement of underperforming CEOs in firms listed on Chinese stock exchanges. Under most circumstances, the findings suggest that the presence of outstanding loans does not increase the probability that a poorly performing CEO will be forced out and replaced. However, there is a positive and significant effect if the under-performing firm relies heavily on secured and short-term bank lending. Bank loans increase the likelihood of a forced CEO turnover in private firms, especially where joint-equity banks serve as the main lenders to the firm. There is no similar increase in the probability of a CEO turnover for state-owned firms or firms that borrow mainly from state-owned banks. Thus, where state ownership of banks and listed firms implies inefficiency or reluctance on monitoring borrower performance, there is an opportunity to improve loan contract arrangements to improve the mon-itoring role of lending banks.
    JEL: G21 G30 G32 G38 K22
    Date: 2016–12–19
  4. By: Yusaku Nishimura (Institute of International Economy, University of International Business and Economics); Yoshiro Tsutsui (Faculty of Economics, Konan University); Kenjiro Hirayama (School of Economics, Kwansei Gakuin University)
    Abstract: This study provides evidence that international stock investors f transactions are a cause of stock market comovements. We analyze return and volatility spillovers between eight major stock markets and stocks cross-listed on an accessible market (H-shares in Hong Kong) and an inaccessible market (A-shares in mainland China) by applying the spillover indexes proposed by Diebold and Yilmaz (2012, 2014) to those markets. Results suggest that spillovers of both return and volatility are greater in an accessible market than in an inaccessible one. We also find that spillover effects intensify as openness of a stock market increases.
    Keywords: investor-induced hypothesis; fundamentals-based hypothesis; cross-listed stocks; spillover index; inaccessible market
    JEL: G15
    Date: 2017–01
  5. By: Fungáčová, Zuzana; Määttä, Ilari; Weill, Laurent
    Abstract: ​This research investigates the determinants of corruption in China using micro-level data. We use survey data on 6,000 households from 28 provinces to estimate logit models that show how corruption perceptions and attitudes to corruption are shaped by individual and provincial determinants. Respondents who see themselves as lower class, as well as members of the Communist Party of China, are more likely to perceive and reject corruption than other respondents. People in rural areas perceive less corruption, but do not differ in their attitudes toward corruption.
    JEL: H11 K42 P16
    Date: 2016–12–05
  6. By: Mamatzakis, Emmanuel; Xu, Bingrun
    Abstract: This study investigates the effectiveness of the contractual governance of Chinese fund management companies by using comprehensive governance data over the period from 2005 to 2015. The study finds that board size a negative impact on its performance and market share. The findings are consistent with the ‘agency cost’ hypothesis. This paper also finds a positive association between the percentage of independent directors and market share and a negative correlation between the percentage of independent directors and the expense ratio. Moreover, a fund management company with a higher level of managerial ownership and a higher proportion of institutional investors results in more effective fund governance; however, a larger institutional investor holding may lead to a higher expense ratio.
    Keywords: Contractual governance, governance effectiveness, board size, board structure, managerial ownership, institutional investors’ holding
    JEL: G20 G23 G30 G34
    Date: 2017–01–11
  7. By: Neely, Christopher J. (Federal Reserve Bank of St. Louis)
    Abstract: China is both a major trading partner of the United States and the largest official holder of U.S. assets in the world. The value of Chinese foreign exchange reserves peaked at just over $4 trillion in June 2014, but has since declined to $3.19 trillion as of August 2016. This very large decline is in foreign exchange reserves is unprecedented and some analysts have speculated that continued sales of these (mostly U.S.) assets might significantly impact the U.S. and global economies. This article explains the reasons for this large decline in official assets, what China’s policy choices are, and how these choices could affect the U.S. economy.
    Keywords: Monetary policy; central banks and their policies; foreign exchange; current account
    JEL: E52 E58 F31 F32
    Date: 2017–01–09
  8. By: Rui Mano
    Abstract: This paper assesses the spillovers from different facets of China rebalancing using a calibrated Ricardian trade model that includes 41 economies, each consisting of 34 sectors. We find that China’s move up the value chain in particular has the potential for significant spillovers – on the one hand, adversely affecting industrialized economies heavily involved in the Asia value chain, while at the same time generating positive spillovers to lower and middle income countries. The model’s strength lies in endogenously capturing production value chains and international trade of goods across sectors.
    Keywords: Spillovers;China;Demand;Consumption;Economic sectors;International trade;Trade models;Transition economies;Spillovers, China rebalancing, trade channel, sectoral trade
    Date: 2016–11–15
  9. By: Kubo, Koji
    Abstract: Myanmar's trade with China is heavily concentrated in cross-border trade through the Yunnan province of China. In this qualitative analysis, we examine factors that yield such a concentration from the viewpoint that trade would be concentrated in the channel where transaction costs are relatively low compared with those in other channels. It is almost certain that weak law enforcement at the border gives rise to informal cross-border trade, which allows traders to save the time and costs for compliance with formal procedures. Apart from informality, unique institutional arrangements have been emerging spontaneously in the border area that can reduce transaction costs in a way compatible with formal trade, thus augmenting cross-border trade. Based on observations of thriving trade at Myanmar's border with China, we draw implications for the country's general trade facilitation measures.
    Keywords: International trade, Informal sector, Myanmar, Cross-border trade, Informal trade, Transaction costs of trade
    JEL: F19 O17 O53
    Date: 2016–12

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