nep-cna New Economics Papers
on China
Issue of 2021‒04‒12
eight papers chosen by
Zheng Fang
Ohio State University

  1. Emission Reduction and Foreign Direct Investment Nexus in China By Yuan Xu; Yanrui Wu; Yongli Shi
  2. Land Use Policy and Employment Growth- Evidence from China By Qiao Wang; Xiuyan Liu; Sam Hak Kan Tang
  3. Urban Growth and Aggregate Growth in China By Ning Ma; Yanrui Wu; Jianxin Wu
  4. Online digital labour platforms in China working conditions, policy issues and prospects By Chen, Yiu Por,
  5. Report on China’s shipbuilding industry and policies affecting it By OECD
  6. The Persistent Effect of Famine on Present-Day China By Pramod Kumar Sur; Masaru Sasaki
  7. China's move to measuring relative poverty implications for social protection By Walker, Robert.; Yang, Lichao.
  8. Four Great Asian Trade Collapses By Alan de Bromhead; Alan Fernihough; Markus Lampe; Kevin Hjortshøj O’Rourke

  1. By: Yuan Xu (Nanjing University of Economics and Finance); Yanrui Wu (Business School, The University of Western Australia); Yongli Shi (Nanjing University of Economics and Finance)
    Abstract: This paper employs a difference-in-difference-in-difference approach to examine the emission reduction and foreign direct investment nexus in China. It combines a firm-level dataset with emission reduction target statistics at city-level. The findings indicate that stringent environmental regulation is associated with the fall of the output of foreign firms in general and the shrinking of pollution-intensive industries in cities with heavy emission reduction pressure in particular. It is also shown that the location choice of foreign investment changes as emission reduction targets at city-level vary. Finally it is found that environmental regulation helps improve the structure of foreign direct investment and hence contributes to industrial upgrading in the economy.
    Keywords: Emission reduction; foreign direct investment; environmental regulation; DDD method; China
    Date: 2021
  2. By: Qiao Wang (School of Economics and Management, Southeast University); Xiuyan Liu (School of Economics and Management, Southeast University); Sam Hak Kan Tang (Business School, The University of Western Australia)
    Abstract: This paper examines the causal effect of land use policy on employment growth in Chinese cities. We find that a stricter Floor Area Ratio Regulation (FARR) leads to a reduction in employment growth in Chinese cities- a one standard deviation reduction in FARR leads to a concurrent reduction of employment growth by 1.1-1.6 percentage points. More populated cities and labour-intensive manufacturing industries are found to be more severely affected by stricter FARR. Moreover, the effect of a stricter FARR is found to be less pronounced on state-owned firms compared to foreign-owned and privately-owned firms. Our main conclusions are robust to a variety of sensitivity tests, different instruments and alternative estimators. They suggest that imposing a stricter legal FARR incurs considerable employment costs for Chinese cities.
    Keywords: Land Use Policy; Floor Area Ratio Regulation; Employment Growth; Latitude; Earthquake Protection
    JEL: R52 R14 R11
    Date: 2021
  3. By: Ning Ma (Hainan College of Economics and Business); Yanrui Wu (Business School, the University of Western Australia; Research Centre in Business, Economics and Resources, Ho Chi Minh City Open University; Faculty of Finance, Banking and Business Administration, Quy Nhon University); Jianxin Wu (Jinan University)
    Abstract: Using a spatial equilibrium model and data of 286 Chinese cities at the prefecture and above- prefecture level from 2002 to 2013, this study estimates the contribution of each of the selected Chinese cities to national GDP growth. The results in this study reveal several interesting patterns. First, what an individual city contributes to aggregate growth is not represented clearly by the city’s GDP based on standard accounting calculation. Despite some of the strongest growth occurring in cities such as Beijing, Tianjin, Shanghai and Chongqing, these cities were only responsible for a small fraction of China’s growth over the period covered. In fact, the analysis shows that it is growth in the cities in the west that has made the greatest contribution to the overall growth of China. Furthermore, the analysis of the results shows that the dispersion of the real wage across Chinese cities increased. This increased wage dispersion lowered aggregate Chinese GDP by 25.41 percent. This represents a loss, which is an effect of the tightening of regulatory constraints to housing supply in high productivity cities like Beijing, Tianjin, Harbin, Shanghai, Wuhan, Changsha, Chongqing, Chengdu, and Xian. Finally, a counterfactual scenario whereby these cities under regulatory constraints are reduced to the same level as the national mean level suggests that Chinese GDP would increase by 20.62 percent.
    Keywords: Spatial Equilibrium; Urban Growth; Welfare; China
    JEL: C6 O18 O53 R11 R31
    Date: 2021
  4. By: Chen, Yiu Por,
    Abstract: Digital labour platforms have been proliferating in China since 2005, making China one of the world’s largest platforms economies. This article summarizes the results of an ILO survey, conducted in 2019, of workers’ characteristics and working conditions on three major digital labour platforms. Using the survey data generated, this paper provides first-hand information on worker demographics, motivations, and experiences. This paper also compares the findings between the Chinese platforms and dominant Western platforms, the object of previous ILO studies. The paper concludes with a discussion about the need for institutional reforms and suggests some possible avenues for implementing policies to improve working conditions.
    Keywords: future of work, EDP personnel, electronic network, technological change, working conditions
    Date: 2021
  5. By: OECD
    Abstract: This report analyses the structural characteristics of China’s shipbuilding industry, notably through comparison of other major shipbuilding economies. Building upon previous reports drafted in 2008 and 2011, it aims to analyse China’s shipbuilding sector from a holistic and multidisciplinary perspective (e.g. the interconnection between trade, competition, monetary, financial, fiscal and industrial policies), with a particular emphasis on government support measures. Key findings from these analyses suggest that: 1) China’s shipbuilding industry has been labelled as a strategic industry, which may equally explain China’s intention to move up the shipbuilding value chain, 2) State-owned conglomerates hold a lot of influence in China’s shipbuilding industry, 3) Government support to the Chinese shipbuilding industry is alleged to have contributed to global excess capacity.
    Keywords: China, Excess capacity, Shipbuilding, State-owned enterprise, Support measures
    Date: 2021–04–09
  6. By: Pramod Kumar Sur; Masaru Sasaki
    Abstract: More than half a century has passed since the Great Chinese Famine (1959-1961), and China has transformed from a poor, underdeveloped country to the world's leading emerging economy. Does the effect of the famine persist today? To explore this question, we combine historical data on province-level famine exposure with contemporary data on individual wealth. To better understand if the relationship is causal, we simultaneously account for the well-known historical evidence on the selection effect arising for those who survive the famine and those born during this period, as well as the issue of endogeneity on the exposure of a province to the famine. We find robust evidence showing that famine exposure has had a considerable negative effect on the contemporary wealth of individuals born during this period. Together, the evidence suggests that the famine had an adverse effect on wealth, and it is even present among the wealthiest cohort of individuals in present-day China.
    Date: 2021–04
  7. By: Walker, Robert.; Yang, Lichao.
    Abstract: With rural extreme poverty officially eradicated in 2020, China is to move to measuring relative poverty in urban and rural areas. Relative poverty describes circumstances in which people cannot afford actively to participate in society and benefit from the activities and experiences that most people take for granted. It is conventionally defined as 40, 50 or 60 percent of national median disposable income. While a single poverty threshold symbolises national unity, separate poverty thresholds could be created for urban and rural areas or provinces. A unified national poverty standard for China based on 40 per cent of national median disposable income threshold implies income levels almost 4 times higher than the existing rural poverty line and 61 per cent higher than average social assistance (Dibao) payments in urban areas (often used as a surrogate urban poverty line). Relative poverty is more persistent than absolute poverty and less affected by economic growth. Research is required to determine the needs of peri-poor persons (i.e., those brought into poverty due to the new definition). Strategies needed to tackle relative poverty include: a comprehensive social protection system inclusive of floors; active policies to assist people out of poverty; poverty mainstreaming; and supportive, redistributive fiscal policies.
    Date: 2021
  8. By: Alan de Bromhead; Alan Fernihough; Markus Lampe; Kevin Hjortshøj O’Rourke (Division of Social Science)
    Abstract: This paper introduces a new dataset of commodity-specific, bilateral import data for four large Asian economies in the interwar period: China, the Dutch East Indies, India, and Japan. It uses these data to describe the interwar trade collapses in the economies concerned. These resembled the post-2008 Great Trade Collapse in some respects but not in others: they occurred along the intensive margin, imports of cars were particularly badly affected, and imports of durable goods fell by more than those of non-durables, except in China and India which were rapidly industrializing. On the other hand the import declines were geographically imbalanced, while prices were more important than quantities in driving the overall collapse.
    Date: 2021–04

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