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on China |
| By: | Kun Mo; Michel Soudan |
| Abstract: | Distortions in capital markets can create financial constraints that deter firms from pursuing optimal investment plans. This paper explores how much these constraints affect investment by ownership type in China, using a panel data model estimated with observations on listed firms for the period 2005–2017. We find that privately owned enterprises (POEs) in China face greater financial constraints than state-owned enterprises (SOEs), as POE investment plans depend more on the availability of internally generated cash. Correspondingly, we find evidence that Chinese lenders appear less concerned about the credit risk of SOEs, and that an expansion in credit correlates with a disproportionally larger increase in investment for SOEs. |
| Keywords: | Financial markets; Firm dynamics |
| JEL: | E22 G1 G3 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocadp:22-22&r=cna |
| By: | Khalil, Makram; Weber, Marc-Daniel |
| Abstract: | In structural vector autoregressive models of United States and euro area manufacturing, we use sign restrictions to identify shocks that alter the frictions to Chinese supply chain trade. We find a quantitatively significant role of such shocks for the decline of US manufacturing output at the height of the Sino-American trade tensions in 2019. At the beginning of the Covid-19 pandemic in early 2020, the results pointed towards large spillovers from the shutdown in China to manufacturing in the US and the euro area. Moreover, for the recovery in late 2020 and 2021, favourable Chinese supply chain shocks related to the shift of preferences towards goods with a large China valued-added content played a relevant role. Interestingly, the impact of Chinese supply chain shocks is not limited to manufacturing sectors that are highly exposed to China. Furthermore, negative Chinese supply chain shocks cause upward price pressure across the whole manufacturing industry. |
| Keywords: | Cross-border supply-chain disruptions,trade frictions,China,trade tensions,Covid-19 recession,US and euro area manufacturing |
| JEL: | E32 F41 F62 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdps:442022&r=cna |
| By: | Martini, Mário H. (Tilburg University, School of Economics and Management) |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:9b277cf1-022b-49d7-87fa-3e2424273d34&r=cna |
| By: | Yongkun Yin (CEMFI, Centro de Estudios Monetarios y Financieros) |
| Abstract: | This paper examines how the number of siblings that parents have affects their fertility decisions. I exploit the population control policies in China, which affected individuals unequally across birth cohorts and regions. The exogenous variation in fertility is used to identify the effect of the number of siblings on the number of children for the next generation. The results show that a couple tends to have 0.068 more children (4.3% of the average number of children) and is 5.6 percentage points more likely to violate the One-Child Policy (19.4% of the violation rate) if the husband and the wife have one more sibling each. Moreover, the effect on fertility is stronger for couples in rural areas where the One-Child Policy was enforced less strictly. I also show that ideal family size, especially that of the wife, is an important channel through which the number of siblings affects fertility. |
| Keywords: | Intergenerational transmission, fertility, siblings, preference formation, population policies, China. |
| JEL: | D19 J13 J18 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:cmf:wpaper:wp2022_2211&r=cna |
| By: | Choi, Ina (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Lee, Sunhyung (Montclair State University); Lee, Jaeho (Center for Area Studies); Kim, So Eun (Center for Area Studies) |
| Abstract: | As in other Asia-Pacific countries, boosting trade with China has provided a growth engine for Australia's economy. Australia shared concerns over security threats posed by China’s military expansion, but up until the mid-2010s hard balancing against China did not seem to be an option for Australia. Australia’s recent moves against China, however, signal that Canberra has reset its China policy, with an overhaul of its national security and defense strategy. The shift of Australia’s China policy is an interesting case to explore how the regional order is likely to evolve in the growing US-China competition. Assessing Australia’s recent foreign policy is also relevant to Korea, both in terms of navigating Korea’s relations with the US and China and enhancing strategic ties between Australia and Korea. Against this backdrop, this study unravels Australia’s strategic responses to the changing regional order and draw implications for Korea's foreign policy. |
| Keywords: | Australia; Australia-China trade disputes; Australia-ROK partnership |
| Date: | 2022–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepwe:2022_030&r=cna |
| By: | Jan‐luca Hennig (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This paper investigates how labour market regulations alter the adverse impact of rising import competition from China in European local labour markets between 1997 and 2006. The paper constructs measures of regional exposure to Chinese imports based on previous literature and on regional labour market frictions exploiting involuntary labour reallocations. Taking into account the endogeneity of import competition and its interaction with labour market regulations, the paper finds that regions more exposed to the rise of China have suffered from a reduction in manufacturing employment shares. This shock grows larger with regional labour market frictions; hence, it exacerbates the impact of trade shock on employment. Moreover, the paper finds that employment in public services, and not in construction or private services sector, absorbed the negative shock to the manufacturing sector. The unemployment rate, the labour force participation rate and wages in all sectors are unresponsive to import competition from China. |
| Keywords: | empirical trade, employment structure, labour reallocation, regional labour markets |
| Date: | 2022–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03856251&r=cna |
| By: | Waisbich, Laura Trajber; Haug, Sebastian |
| Abstract: | This paper offers a comparative analysis of Brazilian and Chinese partnerships with the United Nations (UN) as a mechanism and channel for policy transfer. In international policy travel flows, China and Brazil currently hold privileged places as hubs from which development-related policies travel and through which they circulate. Both countries have invested in systematising their development experience and transferring development policies within their regions and beyond - often through triangular cooperation, i.e. South-South cooperation supported by third actors such as UN entities. So far, however, this variegated engagement has remained under the radar of scholarly attention. To address this gap, we examine 35 policy transfer partnerships - 17 for Brazil and 18 for China - forged with different parts of the UN system over the last two decades. In order to offer a first systematic account of partnership trajectories, we provide an overview of partnership types (namely projects, programmes and policy centres) and transfer dimensions (including the policies themselves, transfer agents and transfer arrangements). Our comparative mapping presents an evolving landscape: while Brazil was first in institutionalising robust policy transfer partnerships with numerous UN entities and then slowed down, China started more cautiously but has significantly expanded its collaboration with the UN system since 2015. The partnerships analysed cover a substantial range of sectors, with a particular focus - for both Brazil and China - on agricultural policies. While Brazilian partnerships with the UN primarily engage with linkages between agriculture and social protection, however, China-UN partnerships focus more on productivity and market linkages. As the first comprehensive mapping and comparative analysis of Brazilian and Chinese policy transfer partnerships with the UN, this paper contributes to a better understanding of (triangular) cooperation schemes between international organisations and their member states, as well as debates about how policies deemed as successful travel around the globe. |
| Keywords: | Brazil, China, United Nations, South-South cooperation, triangular cooperation, policy transfer, knowledge, partnerships, development cooperation projects |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:diedps:152022&r=cna |
| By: | Raphael Lafrogne-Joussier (CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique); Julien Martin (UQAM - Université du Québec à Montréal = University of Québec in Montréal, CEPR - Center for Economic Policy Research - CEPR); Isabelle Mejean (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research - CEPR) |
| Abstract: | How do firms in global value chains react to input shortages? We examine micro-level adjustments to supply chain shocks, building on the Covid-19 pandemic as a case study. French firms sourcing inputs from China just before the early lockdown in the country experienced a relative drop in imports that increases from February to April 2020. This shock on input purchases transmits to the rest of the supply chain through exposed firm's domestic and export sales. Between February and June, firms exposed to the Chinese early lockdown experienced a 5.5% drop in domestic sales and a 5% drop in exports, in relative terms with respect to comparable non-exposed firms. The drop in foreign sales is entirely attributable to a lower volume of exports driven by a temporary withdrawal from occasional markets. We then dig into the heterogeneity of the transmission across treated firms. Whereas the ex-ante geographic diversification of inputs does not seem to mitigate the impact of the shock, firms with relatively high inventories have been able to absorb the supply shock better. |
| Keywords: | Covid-19 pandemic,Supply chain disruptions,Transmission of shocks,Global value chains |
| Date: | 2022–03–22 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03880125&r=cna |
| By: | Cavalcanti, T.; Mohaddes, K.; Nian, H.; Yin, H. |
| Abstract: | This paper investigates the long-run effects of prolonged air pollution on firmlevel human capital, knowledge and innovation composition. Using a novel firm-level dataset covering almost all industrial firms engaged in science and technology activities in China, and employing a regression discontinuity design, we show that prolonged pollution significantly diminishes both the quantity and the quality of human capital at the firm level. More specifically, we show that air pollution affects firm-level human capital composition by reducing the share of employees with a PhD degree and master’s degree, but instead increasing the share of employees with bachelor’s degree. Moreover, the difference in the composition of human capital materially change the knowledge and innovation structure of the firms, with our estimates showing that pollution decreases innovations that demand a high level of creativity, such as publications and inventions, while increasing innovations with a relatively low level of creativity, such as design patents. Quantitatively, on the intensive margin, one μg/m 3 increase in the annual average PM 2.5 concentration leads to a 0.188 loss in the number of innovations per R&D employee. Overall, we show that air pollution has created a gap in human capital, knowledge, and innovation between firms in the north and south of China, highlighting the importance of environmental quality as a significant factor for productivity and welfare. |
| Keywords: | Pollution, human capital, knowledge, innovation, China |
| JEL: | O15 O30 O44 Q51 Q56 |
| Date: | 2023–01–03 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2301&r=cna |
| By: | DACHS Bernhard; NEULÄNDTNER Martina; STEHRER Robert |
| Abstract: | This study investigates the evolution of global value chains (GVCs) and the strategic position of the EU27 in these GVCs and production networks. The analysis is based on input-output data from the FIGARO database that covers 2010-2019. An in-depth coverage is provided for four sectors (food, pharma, electronics, and vehicles) and three industrial ecosystems (energy intensive industries, mobility-transport-automotive, aerospace & defence). In terms of the main results, the overall share of foreign sourcing is quite stable over this period, and the length of GVCs remains roughly the same, so there is no sign of large-scale backshoring. The most important geographical shifts are the gains of China as a supplier in the value chains of EU27 and US. Europe’s strategic capacities, as measured by social network analysis indicators, are in mobility/automotive/transport, energy-intensive industries, and electronics and are towards the US and China. Strategic dependencies exist mainly towards China in electronics and energy-intensive industries. The analysis clearly shows the mutually dependent character of these relationships between the US, China, and the EU27. |
| Keywords: | Global Value Chains, Input-Output, Strategic Dependency, Network Analysis |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc130873&r=cna |
| By: | Asimeng, Emmanuel Theodore; Altenburg, Tilman |
| Abstract: | The socioeconomic wellbeing of urban areas depends on a well-functioning transportation system that makes it easier for people to access goods and services. Whereas most urban areas in emerging economies are expanding in size and human population, high motorisation and inadequate public transport services have resulted in congestion, traffic accidents and increasing transport-related greenhouse gas (GHG) emissions. Urban rail development can help address the current transportation problem because trains can move a large number of people at high speed, provide reliable services, contribute to lower GHGs and have a low accident rate. However, urban rail is expensive and requires many technical and technological capabilities often unavailable in emerging economies because they are technology latecomers. This paper examines how two emerging economies, China and India, have adopted industrial policies to develop local capabilities for urban rail technology. The paper shows how the Chinese government has moved from purchasing urban rail technology from multinational companies (MNCs) to the current situation where it has developed local capabilities, owns rail technology patents and competes with the same MNCs on the international market. The paper also demonstrates how India is gradually improving the local manufacturing of rail subsystems as opposed to importation. Overall, the paper suggests a pathway to industrial policy adoption that demonstrates how emerging economies can catch up with urban rail technology development to address their local transportation needs. |
| Keywords: | China, India, industrial policy, multinational company, technology indigenisation, technology transfer, urban rail |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:diedps:142022&r=cna |
| By: | Luis Buluz (University of Bonn, WIL - World Inequality Lab); Filip Novokmet (University of Bonn); Moritz Schularick (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, University of Bonn, CEPR - Center for Economic Policy Research - CEPR) |
| Abstract: | This paper provides a household-level perspective on the rise of global saving and wealth since the 1980s. We calculate asset-specific saving flows and capital gains across the wealth distribution for the G3 economies – the U.S., Europe, and China. In the past four decades, global saving inequality has risen sharply. The share of household saving flows coming from the richest 10% of household increased by 60% while saving of middle class households has fallen sharply. The most important source for the surge in top-10% saving was the secular rise of global corporate saving whose ultimate owners the rich households are. Housing capital gains have supported wealth growth for middle-class households despite falling saving and rising debt. Without meaningful capital gains in risky assets, the wealth share of the bottom half of the population declined substantially in most G3 economies. |
| Keywords: | Income and wealth inequality, Saving, Household portfolios, Historical micro data |
| Date: | 2022–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03881419&r=cna |
| By: | Shifali Goyal (Indian Institute of Foreign Trade, New Delhi, India); Areej A. Siddiqui (Indian Institute of Foreign Trade, New Delhi, India) |
| Abstract: | This study tries to estimate the carbon emissions embodied in India’s exports to five of its major trading partners, i.e., USA, UAE, Hong Kong, China and Bangladesh, for the year 2015.In order to quantify the same, Bilateral Trade Input-Output (BTIO) model is being used. The study found huge emission embodiment in India’s exports, and also calculated the emission intensity of the goods exported. Once the calculation of emissions embodied in exports is done, the paper further highlights that carbon emissions embodied in India’s exports is not determined by just the quantum of the goods exported, but composition of goods traded and emission intensity of the traded goods also have a substantial impact over emission embodiment. Hence, the study suggests to shift India’s energy consumption patterns from carbon intensive ones to the cleaner and renewable ones, and to reduce its emission intensity |
| Keywords: | Carbon emissions, Bilateral Trade, Input-Output Analysis, Bilateral Trade Input-Output Model (BTIO) |
| JEL: | C67 F18 F64 Q56 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ift:wpaper:2156&r=cna |
| By: | Dhingra, Swati; Freeman, Rebecca; Huang, Hanwei |
| Abstract: | Deep trade agreements (DTAs) are widespread and have taken the world beyond tariff liberalization in goods trade. As the importance of global supply chains and the services sector has increased across the world, shallow tariff reductions have given way to deeper commitments that address non-tariff barriers and behind-the-border barriers to trade. This paper shows that DTA commitments undertaken since the Uruguay Round have increased trade in goods and trade in services by over half in the long term. Taking reduced-form trade elasticity estimates to a general equilibrium quantitative model, DTAs contributed over 40% to the welfare gains from trade globally and even more for advanced economies. China, India and the Eastern European bloc benefited the most from trade agreements. While most of the gains in China and India came from tariff reductions, the gains to Eastern Europe came largely from deep commitments during its accession to the EU. Applying the DTA estimates to ex ante analysis of Brexit, the losses to the UK from its departure from the deepest trade agreement in the world would not be offset by new deep trade deals with key non-EU trade partners. |
| Keywords: | Wiley deal |
| JEL: | L81 J1 |
| Date: | 2022–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117225&r=cna |