nep-cna New Economics Papers
on China
Issue of 2020‒05‒18
ten papers chosen by
Zheng Fang
Ohio State University

  1. Impacts of Social and Economic Factors on the Transmission of Coronavirus Disease 2019 (COVID-19) in China By Qiu, Yun; Chen, Xi; Shi, Wei
  2. Quantifying the Economic Impact of COVID-19 in Mainland China Using Human Mobility Data By Jizhou Huang; Haifeng Wang; Haoyi Xiong; Miao Fan; An Zhuo; Ying Li; Dejing Dou
  3. Is housing collateral important to the business cycle? Evidence from China By Minford, Patrick; Gai, Yue; Ou, Zhirong
  4. Antimicrobial use and farm size in China’s Shandong province By Li, Yanan; Liu, Yanyan; Hoffmann, Vivian; Zhang, Jian
  5. Structural transformation, inequality, and inclusive growth in China By Yanan Li; Chunbing Xing
  6. China’s WTO accession and income inequality in European regions: External pressure and internal adjustments By Cseres-Gergely, Zsombor; Kvedaras, Virmantas
  7. Trade Policy and the China Syndrome By Lorenzo Trimarchi
  8. Social mobility in China: A case study of a quantitative sociological approach to social mobility research in the Global South By Yaojun Li
  9. Chronicle of a Pandemic Foretold By Renda, Andrea; J. Castro, Rosa
  10. Echo Effects of Early-Life Health Shocks: The Intergenerational Consequences of Prenatal Malnutrition during the Great Leap Forward Famine in China By Li, Jinhu; Menon, Nidhiya

  1. By: Qiu, Yun (Jinan University); Chen, Xi (Yale University); Shi, Wei (Jinan University)
    Abstract: This paper models the local and cross-city transmissions of the novel coronavirus in China between January 19 and February 29 in 2020. We examine the role of various socioeconomic mediating factors, including public health measures that encourage social distancing in local communities. Weather characteristics two weeks ago are used as instrumental variables for causal inference. Stringent quarantine, city lockdown, and local public health measures imposed since late January significantly decreased the virus transmission rate. The virus spread was contained by the middle of February. Population outflow from the outbreak source region posed a higher risk to the destination regions than other factors including geographic proximity and similarity in economic conditions. We quantify the effects of different public health measures in reducing the number of infections through counterfactual analyses. Over 1.4 million infections and 56,000 deaths could have been avoided as a result of the national and provincial public health measures imposed in late January in China.
    Keywords: 2019 novel coronavirus, transmission, quarantine, COVID-19
    JEL: I18 I12 C23
    Date: 2020–04
  2. By: Jizhou Huang; Haifeng Wang; Haoyi Xiong; Miao Fan; An Zhuo; Ying Li; Dejing Dou
    Abstract: To contain the pandemic of coronavirus (COVID-19) in Mainland China, the authorities have put in place a series of measures, including quarantines, social distancing, and travel restrictions. While these strategies have effectively dealt with the critical situations of outbreaks, the combination of the pandemic and mobility controls has slowed China's economic growth, resulting in the first quarterly decline of Gross Domestic Product (GDP) since GDP began to be calculated, in 1992. To characterize the potential shrinkage of the domestic economy, from the perspective of mobility, we propose two new economic indicators: the New Venues Created (NVC) and the Volumes of Visits to Venue (V^3), as the complementary measures to domestic investments and consumption activities, using the data of Baidu Maps. The historical records of these two indicators demonstrated strong correlations with the past figures of Chinese GDP, while the status quo has dramatically changed this year, due to the pandemic. We hereby presented a quantitative analysis to project the impact of the pandemic on economies, using the recent trends of NVC and V^3. We found that the most affected sectors would be travel-dependent businesses, such as hotels, educational institutes, and public transportation, while the sectors that are mandatory to human life, such as workplaces, residential areas, restaurants, and shopping sites, have been recovering rapidly. Analysis at the provincial level showed that the self-sufficient and self-sustainable economic regions, with internal supplies, production, and consumption, have recovered faster than those regions relying on global supply chains.
    Date: 2020–05
  3. By: Minford, Patrick (Cardiff Business School); Gai, Yue (Cardiff Business School); Ou, Zhirong (Cardiff Business School)
    Abstract: This paper investigates whether housing collateral is important to the business cycle in China. We develop two models, one without housing collateral as benchmark and one variant allowing for it. Indirect Inference procedure tests these two modelsÕ compatibility with the data. We find that the benchmark model passes the test, while the collateral model is strongly rejected. According to the benchmark model, shocks from the housing market have limited impact on the Chinese business cycle. By contrast, the exogenous spending shock from gov- ernment and net exports, the monetary policy shock and the goods-sector cost/productivity shock, all in turn most likely connected to world business cycle shocks (especially the global financial crisis), are found to be the main drivers.
    Keywords: Housing market; DSGE model; Housing collateral; Indirect Inference; China;
    JEL: E32 E44 E52 R31
    Date: 2020–05
  4. By: Li, Yanan; Liu, Yanyan; Hoffmann, Vivian; Zhang, Jian
    Abstract: In this paper, we examine antibiotic use in the Chinese hog farming sector. China warrants special atten-tion for several reasons. First, China is both the largest producer and the largest consumer of antibiotics in the world (Zhu et al. 2013). Second, it leads the world in use of antimicrobial drugs in livestock (Van Boeckel et al. 2015). Third, several studies have shown higher levels of antibiotic resistance in China than in other countries (Zhang et al. 2006; Hu et al. 2014; Hvistendahl 2012). Finally, the combination of high rates of antibiotic use and weak regulatory enforcement make China an ideal setting in which to examine the drivers of antimicrobial use in livestock production.
    Keywords: CHINA; EAST ASIA; ASIA; farm size; antimicrobials; antimicrobial resistance; livestock; vaccines; swine; biosecurity; antimicrobial use; hog breeds
    Date: 2019
  5. By: Yanan Li; Chunbing Xing
    Abstract: In this paper, we analyse the relationship between China's structural transformation and the inclusiveness of its economic growth. China's economy has undergone significant structural changes since it initiated the economic reforms in 1978. Economic activities have shifted from the low-productivity agricultural sector to the high-productivity industrial sector and, more recently, the tertiary sector, with a large portion of the labour force moving from rural to urban areas, from inland to coastal regions, and from the public to the private sectors.
    Keywords: Inequality, Education, Migration, Poverty reduction, China
    Date: 2020
  6. By: Cseres-Gergely, Zsombor (European Commission); Kvedaras, Virmantas (European Commission)
    Abstract: Exports from China have surged substantially since its accession to the World Trade Organization in 2001. We investigate how this expansion affected income inequality within European regions by separating the trade pressure experienced in external and domestic markets, as well as exploring the importance of several economic mechanisms. Despite some intermediate adjustments, softening the influence of Chinese pressure and even facilitating European exports, we establish a significant increase of inequality that is concentrated mostly in the lower part of regional income distributions. We determine a significant channeling of the trade pressure to income inequality through the shrinking manufacturing sector, the increasing unemployment rate, and the technological upgrade of manufacturing exports, together with an increasing demand for better-qualified labor
    Keywords: China, EU, globalization, income, inequality, regions, trade
    JEL: D31 D63 F16 F61
    Date: 2020–05
  7. By: Lorenzo Trimarchi (Université de Namur)
    Abstract: The recent backlash against free trade is partially motivated by the decline in manufacturing employment due to rising import competition from China. Previous studies about the “China syndrome†neglect the role of trade policy. This is surprising, given that politicians in high-income countries have extensively used antidumping (AD) measures to protect their economies from rising Chinese imports. In this paper, I estimate the causal effect of trade protection on imports and employment, by constructing a new instrument for AD measures based on industries’ importance in swing states and experience in filing AD petitions. I show that AD duties have reduced import competition, decreasing the annual growth rate of US imports from China by 0.40 percentage points on average. They have also helped contain the China syndrome, by increasing the annual growth rate of employment in protected industries by 0.07 percentage points. These results show that protectionist instruments allowed under GATT/WTO rules can be used to attenuate the effects of import competition on employment.
    Keywords: Antidumping, Import Competition, Manufacturing Jobs, US-China Trade Relations
    JEL: F13 F14 F16 J20
    Date: 2020–05
  8. By: Yaojun Li
    Abstract: This study analyses intergenerational class mobility in China as a case study of a quantitative sociological approach to social mobility research in the Global South. Drawing on national representative surveys collected between 2010 and 2015 in China, the analysis focuses on absolute and relative mobility rates for men and women across four birth cohorts. With regard to absolute mobility, we find rising levels of mobility, with upward mobility prevailing over downward mobility.
    Keywords: Social mobility, Gender, log-linear models, symmetrical odds ratios, Hukou registration system, China
    Date: 2020
  9. By: Renda, Andrea; J. Castro, Rosa
    Abstract: In just a few weeks, COVID-19 appeared in China and quickly spread to the rest of the world, including Europe and the United States. Many have rushed to describe the outbreak as a ‘black swan’ – an unpredictable event with extremely severe consequences. However, COVID-19 was not only predictable ex post: it was amply predicted ex ante. This allows us to draw some preliminary lessons: First, economic policy will need to shift from its current focus on efficiency, towards a greater emphasis on resilience and sustainability. Second, a more centralised governance to address health emergencies is needed. Third, Europe should create a centre for the prevention of large-scale risks. Fourth, digital technologies, if handled with care, can be an important part of both a mitigation and a response strategy. Fifth, Europe should improve its science advice and communication functions. Finally, there are many ways to pursue enhanced resilience and responsiveness, but not all of them are compatible with sustainability and democratic values. The challenge is to find an adequate policy mix, which safeguards individual rights and liberties, protects the economy, and at the same time strengthens government preparedness for cases of epidemics and pandemics.
    Date: 2020–03
  10. By: Li, Jinhu (Deakin University); Menon, Nidhiya (Brandeis University)
    Abstract: Few studies have examined the "echo effect" of early-life shocks related to prenatal malnutrition, that is, whether the legacy of such shocks is transmitted to the next generation. This study addresses this gap by leveraging extreme malnutrition during the Great Leap Forward famine in China, and by examining the intergenerational consequences of the famine on those who were not directly impacted. Using a difference-in-differences framework, we estimate the causal effect of the famine on a wide range of outcomes of children of mothers who were exposed in-utero including income, education, employment, and intergenerational income mobility; indicators that have not been considered in detail in the literature. We further contribute by using a refined measure of famine exposure at the prefecture level in rural areas, and by exploiting rich data on those directly affected and their children. We find that on average, the famine had negative echo effects on second-generation outcomes. These echo effects are primarily due to the adverse impacts on daughters, perhaps reflecting a combination of positive selection of sons born to mothers exposed to prenatal malnutrition during the famine and cultural aspects such as son preference. Our results withstand a battery of robustness and specification checks.
    Keywords: foetal origins, great leap forward famine, malnutrition, intergenerational impacts, labour market, China
    JEL: I15 J62 I32 P36 N45
    Date: 2020–04

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