nep-cna New Economics Papers
on China
Issue of 2018‒05‒28
seven papers chosen by
Zheng Fang
Ohio State University

  1. How big is China’s digital economy? By Alicia García-Herrero; Jianwei Xu
  2. The Dynamics of Informal Employment in Urban China By Deng, Quheng; Ma, Xinxin
  3. Does the Utilization of Information Communication Technology Promote Entrepreneurship: Evidence from Rural China By Barnett, William; Hu, Mingzhi; Wang, Xue
  4. Contagious Exporting and Foreign Ownership: Evidence from Firms in Shanghai using a Bayesian Spatial Bivariate Probit Model. By Badi Baltagi; Peter H. Egger; Michaela Kesina
  5. WeChat - using social media for the assessment of tourist preferences for environmental improvements in China By Ahlheim, Michael; Neidhardt, Jan; Siepmann, Ute; Yu, Xiaomin
  6. The global component of inflation volatility By Andrea Carriero; Francesco Corsello; Massimiliano Marcellino
  7. Characteristics of Association Words about Love among Tibetan College Students in China By Zhang Chen-guang; Zhang Ting; Fu Jia-hui

  1. By: Alicia García-Herrero; Jianwei Xu
    Abstract: This paper reviews international measures of the digital economy and compares them with those developed by Chinese officials and private sources. Given the lack of comparability, we use China’s input and output and census data to come up with an internationally comparable estimate of the size of China’s information and communication technology (ICT) sector (the core of digital economy), in terms of both value added and employment. Based on the latest available statistics, our measurements indicate that China’s digital economy is not bigger relative to the size of the Chinese economy than the OECD average, especially in terms of ICT employment. This finding, which might look striking based on the current perception of China’s digital economy, masks large differences across regions (with Beijing, Guangdong and Shanghai ahead of the OECD average).
    Date: 2018–05
  2. By: Deng, Quheng; Ma, Xinxin
    Abstract: Utilizing the rotating panel data based on the Urban Household Surveys from 2002 to 2007 conducted by National Bureau of Statistics of China , this study investigates the dynamics of informal employment in urban China. It is found that the proportion of informal employment to the total employment increases continuously from 2002 to 2007. Transition rates between the informal and formal employment status indicate the probability of persistence in the informal employment is great. To consider that there may exists spurious state dependence which may overestimate the persistence in informal employment, this study utilizes the random-effects dynamic probit models to address the unobserved heterogeneity problem, and deals with the initial condition problem and the serial correlation of transitory shocks. Based on these regression results, this study disentangles the genuine from spurious state dependence. It is found that the genuine state dependence accounts for the majority of the persistence in informal employment. Genuine state dependence patterns for various subgroups are also examined.
    Keywords: dynamics, informal employment, persistence, spurious state dependence, genuine state dependence
    Date: 2018–05
  3. By: Barnett, William; Hu, Mingzhi; Wang, Xue
    Abstract: Impacts on the probability of transition to entrepreneurship in rural China associated with the utilization of information communication technology (ICT) are estimated using longitudinal data from the China Family Panel Studies (CFPS) survey. We identify cell phone ownership and internet use as proxy variables for ICT utilization and find that cell phone ownership and internet use have positive impacts on entrepreneurship. After controlling for observables and time and regional fixed effects, cell phone users (internet users) are 2.0 (6.4) percentage points more likely to engage in entrepreneurship than the others. Considering that the average entrepreneurship rate for rural households is only 9.5% in the sample, the influence of cell phone ownership and internet use are very strong in the economic sense. Our results are robust to unobservable individual characteristics, model misspecification, and reverse causality of entrepreneurship to ICT utilization. Evidence also suggests that social network and information and knowledge acquisition play the mediating roles in the impact of ICT utilization on entrepreneurship.
    Keywords: ICT; social network; information acquisition; entrepreneurship
    JEL: D10 M51 Q55
    Date: 2018–03–18
  4. By: Badi Baltagi (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244); Peter H. Egger (ETH Zurich, CEPR, CESifo, GEP); Michaela Kesina (ETH Zurich)
    Abstract: Whether a firm is able to attract foreign capital and whether it may participate at the export market depends on whether the fixed costs associated with doing so are at least covered by the incremental operating profits. This paper provides evidence that success for some firms in attracting foreign investors and in exporting appears to reduce the associated fixed costs with exporting or foreign ownership in other firms. Using data on 8,959 firms located in Shanghai, we find that contagion and spillovers in exporting and in foreign ownership decisions within an area of 10 miles in the city of Shanghai amplify fixed-cost reductions for both exporting as well as foreign ownership of neighboring firms. Contagion among exporters and among foreign-owned firms, respectively, amplify shocks to the profitability of these activities to a large extent. These findings are established through the estimation of a spatial bivariate probit model.
    Keywords: Firm-Level Exports, Firm-Level Foreign Ownership, Contagion, Spatial Econometrics, Chinese Firms
    JEL: C11 C31 C35 F14 F23 L22 R10
    Date: 2018–04
  5. By: Ahlheim, Michael; Neidhardt, Jan; Siepmann, Ute; Yu, Xiaomin
    Abstract: Environmental valuation studies with tourists have been very popular already over a long period of time. Tourists are an important stakeholder group with respect to the decision if some environmental project in a tourist region should be realized or not. Typically such studies are organized as face-to-face surveys conducted in the respective vacation areas. Tourists are asked their willingness to pay (e.g. in terms of higher entrance fees for certain amenities on site or a mark-up on accommodation prices etc.) for the implementation of an environmental project or preservation measure in that area. Based on theoretical considerations we argue that in the special case of tourist surveys internet-based surveys are preferable to face-to-face surveys under validity aspects as well as under the aspect of the representativeness of the survey results. Based on an empirical valuation study we conducted in Southwest China we illustrate the practical problems arising in the context of internet surveys in developing or threshold countries.
    Keywords: environmental valuation,reforestation,Contingent Valuation Method,internet surveys,tourist preferences,China
    JEL: D6 H4 Q23 Q51
    Date: 2018
  6. By: Andrea Carriero (Queen Mary, University of London); Francesco Corsello (Bank of Italy); Massimiliano Marcellino (Bank of Italy)
    Abstract: Global developments play an important role in domestic inflation rates. Previous literature has found that a substantial amount of the variation in a large set of national inflation rates can be explained by a single global factor. However, inflation volatility has been typically neglected, while it is clearly relevant both from a policy point of view and for structural analysis and forecasting purposes. We study the evolution of inflation rates in several countries, using a novel model that allows for commonality in both levels and volatilities, in addition to country-specific components. We find that inflation stochastic volatility is indeed important, and a substantial share of it can be attributed to a global factor that also drives the levels and persistence of inflation. While various phenomena may contribute to global inflation dynamics, it turns out that since the early 1990s, the estimated global factor is correlated with China’s PPI and with oil inflation levels and volatilities. The extent of commonality among core inflation rates and volatilities is substantially smaller than for overall inflation, which leaves scope for national monetary policies.
    Keywords: inflation, volatility, global factors, large datasets, multivariate autoregressive index models, reduced rank regressions, forecasting
    JEL: E31 C32 E37 C53
    Date: 2018–04
  7. By: Zhang Chen-guang (Southwest Minzu University); Zhang Ting (Southwest Minzu University); Fu Jia-hui (Southwest Minzu University)
    Abstract: In order to explore the characteristics of Tibetan college students’ association words about “love†under the background of social transformation in China, 239 Tibetan college students in Southwest Minzu University were selected as research objects to associate Chinese words with the stimulate word “love†. After all the association words collected were sorted out, statistical analyses like word frequency, association intensity and Chi-square test were carried out. Results showed that both “love experience†and “commitment†categories were important in Tibetan college students’ association words; men were more likely to think of the “love representation “ and “Love experience B†(feeling of miss in love) categories, while women tended to experience “Love experience A†(sweet feeling in love); who were single but had intimate experience are more likely to associate words of “pain of loss†category; and as a whole, Tibetan college students paid less attention to “rationality†, “Joint action†and “dullness†categories.
    Keywords: Tibetan students, love concept, word association, implicit theory
    Date: 2018–03

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