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on China |
| By: | Gustafsson, Björn Anders (University of Gothenburg); Sai, Ding (Chinese Academy of Social Sciences) |
| Abstract: | Using data from the China Household Income Project in 2013 and 2018, this paper studies relative poverty among rural hukou holders living in urban China and urban hukou holders. People living in households with an income below a fixed percent of the median per-capita income and wealth below the same fixed percent of the median per-capita wealth among urban residents are deemed as relative poor. Although migrants with rural hukou living in urban China were more prone to twice poverty than urban residents in 2013, this was not generally the case in 2018. A multivariate analysis shows several factors to be related to the probability of being twice relative poor. Even considering these factors, a rural hukou status increased the probability of being twice relative poor in 2013. In contrast, such an excess risk of being twice relative poor was much lesser outspoken in middle and low-ranking cities in 2018. However, rural to urban migrants living in high-ranking cities had a somewhat higher risk of being relative poor than urban residents with the same characteristics in 2018. |
| Keywords: | China, poverty, migrants, China Household Income Project |
| JEL: | I32 P36 R23 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16255&r=cna |
| By: | Meng, Xin (Australian National University) |
| Abstract: | In the past forty years the Chinese economy achieved miracle growth and many attributed a significant part of this to China's favourable labour supply flowing from the "demographic dividend": a larger share of working age population (WAPS). Currently, this dividend is slipping away and many in China are very concerned. Against this background I set out to examine the contributions of various dimensions of China's changing WAPS and its impact on economic growth. I show that between 1982-2015 the increase in the WAPS was offset by a decline in the labour force participation rate, resulting in a very limited increase in the quantity of labour supply. I then estimate the association between regional variations in economic growth and changes in factors such as population size, WAPS, migration, education. The results lend little support to the view that increasing WAPS played a major role in China's economic growth over this period. |
| Keywords: | labor supply, demographic dividends, China |
| JEL: | J10 J11 J21 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16207&r=cna |
| By: | Martin Chorzempa (Peterson Institute for International Economics) |
| Abstract: | Export controls have become one of the most contentious battlegrounds in US-China technology competition. US semiconductor export controls aimed at China, however, have also embroiled allies such as South Korea. These controls largely do not affect Korean firms' chip sales to China, but Korean firms are vulnerable because they have large chip production facilities in China, which make around 40 percent of the memory chips for these firms. Those facilities in China rely on access to semiconductor manufacturing equipment (SME) or servicing from not only the United States but also other countries that have imposed controls on exporting advanced SME to China. Although the United States is unlikely to shut off access to the technology needed to keep the plants running for the foreseeable future, it has signaled that it will not allow new technology needed to upgrade those facilities, so they will become uncompetitive over the next few years and will need to be shuttered or sold off. For future production, Korean firms will need to build new facilities at great (albeit subsidized) expense, amortizing the sunk costs of operations in China over the coming years. At the same time, the controls have created significant benefits for Korean firms by shutting off Chinese competition for their memory businesses. Yet benefiting from the tensions between superpowers comes with serious risks. Firms and governments must deal with much greater uncertainty and evaluate the risk of their dependence on both the United States and China. |
| Date: | 2023–07 |
| URL: | http://d.repec.org/n?u=RePEc:iie:pbrief:pb23-10&r=cna |
| By: | Jesús Fernández-Villaverde; Lee Ohanian; Wen Yao |
| Abstract: | This paper studies China’s four-fold increase in per capita GDP relative to the U.S. between 1995 and 2019. First, we argue that China’s growth pattern is very similar to that of several other East Asia economies that initially grew very quickly. Second, we show that a minimalist Ramsey-Cass-Koopmans model with a parsimonious TFP catch-up process can account for China’s growth path and the growth paths of other East Asia economies at a similar stage of development. The growth paths of other East Asia economies and the model predictions suggest that China’s growth will substantially slow, so much so that we find the U.S. growth rate will likely be higher than China’s by 2043. We also find that China’s income per capita will level off at roughly 44% of the U.S. level around 2100. |
| Keywords: | China, East Asia, economic growth, Ramsey-Cass-Koopmans model, TFP catch up |
| JEL: | E10 E20 O40 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10499&r=cna |
| By: | Peng, Tao (Southwestern University of Finance and Economics); Chan , Ying Tung (Beijing Normal University); Minetti, Raoul (Michigan State University, Department of Economics) |
| Abstract: | This paper studies the impacts of the Covid-19 epidemic on economic and health outcomes in China from January 20 to September 28, 2020. We first document the outbreak and the decline of the epidemic and the containment policies implemented in China during this period. We then use a SIR-Macro model to study the macroeconomic and health outcomes of the epidemic. Our model can generate the infection and death dynamics broadly consistent with the data and the U-shaped recovery of the Chinese economy at the weekly frequency. Our paper demonstrates that both the containment policies and the resilience of the society play important roles in fighting the epidemic. |
| Keywords: | Covid-19; containment policies; digital economy; resilience of the society |
| JEL: | E00 E65 H12 I10 |
| Date: | 2023–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:ris:msuecw:2023_002&r=cna |
| By: | Martin Chorzempa; Nicolas Véron |
| Abstract: | This paper aims to inform the discussion in relation to China with accounts of experiences in large and complex financial sectors. |
| Date: | 2023–03 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polbrf:node_8901&r=cna |
| By: | Zhao, Zhong (Renmin University of China); Zheng, Liang (Central University of Finance and Economics) |
| Abstract: | The impact of the incumbent state-owned enterprises (SOEs) on the births of new private-owned enterprises (POEs) in China is a central concern for the government and society. In this paper, we apply agglomeration theories to distinguish the linkages between SOEs and POEs. Using China's 2008 economic census, the 2007 Input-Output Table, and the 2005 population mini census, we measure the formation of new POEs at the city-industry level, and the agglomeration forces of distance proximity to inputs, outputs, labor, and technology. More explicitly, we measure the extent to which local SOEs provide relevant inputs, consume outputs, employ similar workers, and use similar technology. Our findings indicate that overall, incumbent SOEs hinder the formation of new POEs. For manufacturing, the entry of new POEs is significantly lower in places where more upstream SOEs are concentrated. For services, the entry of new POEs is significantly lower in places where more upstream and downstream SOEs are concentrated. However, the agglomeration effects from the incumbent POEs are either insignificant or significantly positive. |
| Keywords: | new firm formation, state-owned enterprise, firm ownership, agglomeration |
| JEL: | L26 L60 L80 R10 R12 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16259&r=cna |
| By: | Alicia García-Herrero |
| Abstract: | This paper discusses China’s growth for the next two decades, identifying the main challenges and factors that could mitigate its deceleration. |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polbrf:node_9166&r=cna |
| By: | Zhao, Zhong; Zheng, Liang |
| Abstract: | The impact of the incumbent state-owned enterprises (SOEs) on the births of new private-owned enterprises (POEs) in China is a central concern for the government and society. In this paper, we apply agglomeration theories to distinguish the linkages between SOEs and POEs. Using China's 2008 economic census, the 2007 Input-Output Table, and the 2005 population mini census, we measure the formation of new POEs at the city-industry level, and the agglomeration forces of distance proximity to inputs, outputs, labor, and technology. More explicitly, we measure the extent to which local SOEs provide relevant inputs, consume outputs, employ similar workers, and use similar technology. Our findings indicate that overall, incumbent SOEs hinder the formation of new POEs. For manufacturing, the entry of new POEs is significantly lower in places where more upstream SOEs are concentrated. For services, the entry of new POEs is significantly lower in places where more upstream and downstream SOEs are concentrated. However, the agglomeration effects from the incumbent POEs are either insignificant or significantly positive. |
| Keywords: | New Firm Formation, State-owned Enterprise, Firm Ownership, Agglomeration |
| JEL: | L26 L60 L80 R10 R12 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1296&r=cna |
| By: | Eric A. Hanushek; Yuan Wang; Lei Zhang |
| Abstract: | The dramatic expansion of the education system and the transformation of the economy in China provide an opportunity to investigate how the labor market rewards skills. Between 2007 and 2018, the overall return to cognitive skills is virtually constant at 10%, whereas the college premium drops steeply by more than 20 percentage points. But, the regional differences in returns are significant and highlight the importance of differential demand factors. College returns are higher in more developed regions, but the declining trend is more pronounced. Returns to cognitive skills increase in more developed regions and decrease in less developed regions. |
| JEL: | I26 J01 O10 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31367&r=cna |
| By: | Chaonan Feng; Liyan Han; Lei Li |
| Abstract: | During the U.S.-China trade war, the U.S. punitive tariffs were almost entirely borne by U.S. importers. In contrast, only 68% of China’s retaliatory tariffs were paid by Chinese importers. The puzzling difference between the U.S. and China is mainly driven by their different import structures and product heterogeneity in tariff pass-through. China mainly imported products with lower tariff pass-through from the U.S., such as agricultural products and aircraft, while the U.S. primarily imported products with higher tariff pass-through from China, such as electronics. Furthermore, we decompose the product-level tariff pass-through and show that a higher ratio of import demand elasticity over export supply elasticity leads to lower tariff pass-through under perfect competition. |
| Keywords: | trade war, tariff pass-through, import structure, product heterogeneity, demand elasticity, supply elasticity |
| JEL: | F13 F14 F61 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10497&r=cna |
| By: | Fan, Jingting (Pennsylvania State University); Li, Lei (University of Mannheim) |
| Abstract: | Imported capital goods, which embody skill-complementary technologies, can increase the supply of skills in developing countries. Focusing on China and using a shift-share design, we show that city-level capital goods import growth increases the local skill share and that both skill acquisition and migration play a role. We develop and quantify a spatial equilibrium model with these two mechanisms to examine the aggregate effects of capital goods imports, accounting for trade and migration linkages between cities. Counterfactual experiments suggest that the growth in capital goods imports in China between 2000 and 2010 led to a 3.7-8.9 million increase in the stock of college graduates, representing 5.7-13% of the total increase over this period. However, this growth disproportionately favored coastal regions, exacerbating existing spatial disparities. |
| Keywords: | imported capital goods, capital-skill complementarity, skill acquisition, migration |
| JEL: | F14 F16 F66 J24 J61 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16231&r=cna |
| By: | Sjöholm, Fredrik (Research Institute of Industrial Economics (IFN)) |
| Abstract: | This paper examines the European Union's changing perspective on globalization, reflecting a shift from its traditionally open, rules-based trade policy. The rise of internal protectionist measures, coupled with increasing economic insularity in the US and China, are challenging this policy. The study advocates revitalizing the EU's internal market and fostering robust international trade policies, contrasting this with the current trend of implementing various types of selective industry support. It further underscores the EU's heightened responsibility in global trade liberalization, emphasizing the urgency for new trade agreements, particularly with the US, and a reinvigorated role for the WTO. |
| Keywords: | Globalization; European Union; Protectionism; Industrial Policy |
| JEL: | F02 F15 F51 |
| Date: | 2023–07–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1469&r=cna |
| By: | Kalyanpur, Nikhil |
| Abstract: | Globalization did not negate state power. It changed the toolkit. We expected the norms and incentives of the liberal economic order to push regimes in places like China and Russia to democratize. Instead, authoritarianism appears to be thriving. This article argues that authoritarians have learned how to take advantage of the institutions underpinning globalization for their own illiberal ends. They use courts in major economic powers to negate the effects of international institutions and to target their political competition. They subvert our expectations by repurposing the basic premises of liberalism–predictability and openness. The article demonstrates these claims by examining how the institutions of multiple international economic regimes, which were designed as constraints, have been turned into offensive tools. The findings illustrate that International Political Economy (IPE) scholars need to begin analyzing how governments learned these tactics and whether we can reconcile the contradictions they exploit. |
| Keywords: | International order; economic coercion; global governance; illiberalism; statecraft; transnational law; Taylor & Francis deal |
| JEL: | J1 |
| Date: | 2023–06–13 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:118837&r=cna |