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on China |
| By: | Liu, Yan (Tilburg University, School of Economics and Management) |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:b54b3315-1185-48b8-aaf8-8a3f5af0d9ce&r=cna |
| By: | Valérie Mignon; Jamel Saadaoui |
| Abstract: | This paper assesses the effect of US-China political relationships and geopolitical risks on oil prices. To this end, we consider two quantitative measures, the Political Relationship Index (PRI) and the Geopolitical Risk Index (GPR), and rely on structural VAR and local projection methodologies. Our findings show that improved US-China relationships, as well as higher geopolitical risks, drive up the price of oil. In fact, unexpected shocks in the political relationship index are associated with optimistic expectations of economic activity, whereas unexpected shocks in the geopolitical risk index also reflect fears of supply disruption. Political tensions and geopolitical risks are thus complementary causal drivers of oil prices, the former being linked to consumer expectations and the latter to the prospects of aggregate markets. |
| Keywords: | Oil prices, political relationships, geopolitical risk, China. |
| JEL: | Q4 F51 C32 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:drm:wpaper:2023-28&r=cna |
| By: | Alviarez, Vanessa; Chen, Cheng; Pandalai-Nayar, Nitya; Varela, Liliana; Yi, Kei-Mu; Zhang, Hongyong |
| Abstract: | We study the role of multinationals (MNCs) in facilitating firm-level and aggregate structural transformation. Using a stylized model of multinational production and trade, we show that an inward multinational liberalization in the manufacturing sector raises employment in host country firms, and decreases manufacturing employment, while also raising services employment, in the parent firms. We also show the conditions under which aggregate structural transformation occurs. We test the models firm-level predictions by using confidential microdata from Japan. We study the response of Japanese MNC parents and their affiliates in China to an exogenous change in China's openness to foreign direct investment (FDI). We find that in industries where inward FDI was encouraged, Japan MNCs' affiliates in China experienced increases in their employment. We also find that MNC parents in the encouraged industries experienced decreases in home country manufacturing employment and increases in home country services and R&D employment. Finally, using microdata for several advanced and middle-income countries, we decompose the change in overall manufacturing employment shares into MNC and non-MNC components. We find a significant role for MNCs across all countries, suggesting the mechanism we highlight is an important global driver of structural transformation. |
| Keywords: | Multinational Firms;structural transformation;Manufacturingemployment |
| JEL: | F41 F44 |
| Date: | 2023–02 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12685&r=cna |
| By: | Hendrix, Cullen; Noland, Marcus |
| Abstract: | This paper addresses the factors shaping the vote of member states on the United Nations Human Rights Council (UNHRC) regarding whether to debate human rights conditions in the Xinjiang Autonomous Region of China. Explanations for the UNHRC’s decision not to debate human rights in Xinjiang fall into three categories: 1) democracy, development, and human rights performance; 2) demographic factors; and 3) security and economic ties to major powers, specifically the United States and China. Bayesian model averaging identifies three factors as robust covariates of the Xinjiang UNHRC vote: liberal democratic domestic institutions, NATO membership, and Chinese arms transfers. Countries with higher democracy scores and NATO member countries were more likely to vote yes, while recipients of Chinese arms transfers were more likely to vote no. In addition to its direct effect, liberal democracy exerts a significant indirect effect via its effect on Chinese arms transfers, with less democratic countries more likely to receive Chinese arms. Participation in the Belt and Road Initiative (BRI) is not a robust correlate when arms transfers are considered. Thus, our analysis lends support to interpreting the vote as a reflection of wider competition between the United States and China but rejects part of the conventional wisdom about how the two countries approach building and mobilizing coalitions in international institutions. |
| Keywords: | China, arms transfers, Belt and Road Initiative, Xinjiang, United National Human Rights Council |
| JEL: | D7 D72 D74 F53 F55 H56 |
| Date: | 2023–09–19 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:118630&r=cna |
| By: | Jiandong Ju; Hong Ma; Zi Wang; Xiaodong Zhu |
| Abstract: | We provide the first quantitative evaluation of the impacts and interactions of the US-China trade wars and industrial policy competitions. We extend the multi-country-multi-sector model in Caliendo and Parro (2015) by incorporating sectoral external economies of scale. We find that (i) under our baseline calibration of scale economies, the "Made-in-China 2025" ("MIC 2025") subsidies tend to improve the welfare of both China and the U.S.; (ii) the US gains from Trump administration's tariffs if China does not retaliate, and the gain is larger if China had implemented the "MIC 2025" project; (iii) in a non-cooperative tariff game targeting on high-tech industries supported by the "MIC 2025", both China and the U.S. impose high tariffs and endure welfare losses; and (iv) if it is feasible for the U.S. to subsidize its own high-tech industries, the U.S. would reduce its tariffs on high-tech imports from China and benefit from its own industrial subsidies. These results (i) provide a rationale for trade wars and industrial policy competitions between the U.S. and China, and (ii) suggest that industrial subsidies, if properly implemented, may generate less distortion than import tariffs as a means of international competition. |
| Keywords: | Trade War, Industrial Policy, Scale Economies, Strategic Interactions |
| JEL: | F12 F13 F17 F51 |
| Date: | 2023–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-760&r=cna |
| By: | Zagler, Martin; Amighini, Alessia; Fang, Weidi |
| Abstract: | We analyze the evolution of wage differentials between party members and non-members across more than two decades (1995-2018). We apply the Oaxaca-Blinder composition method to disentangle the contribution to the wage gap of different levels of human capital from discrimination against non- members. We also run quantile regressions to estimate the slope of the wage premium functions applying the Macada-Mata decomposition. Our results show party wage premium has decreased over time, but it is still high. There is also evidence of a widening divergence between urban and rural workers, with the former getting higher wage premia since 2013, while the latter have lost most of their return to party membership, and is still positive only for workers in the top quintile. A positive discrimination for CPC members (not justified by characteristics) started in 2013; the party still recruits elites, but over-pays them for party loyalty more than for their qualifications, attracting opportunists. |
| Keywords: | Communist Party of China (CPC); wage premium for CPC membership; decomposition methods; China |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus005:46498653&r=cna |
| By: | Niemeläinen, Julia |
| Abstract: | This paper provides a brief overview of China's capital controls, external asset holdings and the real interest rate, and analyzes the quantitative effects of China's macroeconomic policies between 2000 and 2015, including capital controls, interest rate policy, exchange rate policy and fiscal policy, on the dynamics of China's trade balance vis-a-vis the United States and the world real interest rate. In my analysis, I take into account the demographic differences between the countries, which affect the external imbalances directly and indirectly by affecting the transmission of the macroeconomic policies. Capital controls in China remain stringent even though they have somewhat eased in 2010s, and its gross external asset holdings differ from its peer countries both in terms of the largest functional categories and by type of investment. The average interest rate spread with the US has narrowed down. According to my analysis, the macroeconomic policies overall, and mainly the undervaluation of the real exchange rate, have had a positive impact on China's trade balance. The impact of the macroeconomic policies on the real interest rate has been positive, countering the negative trend induced by demographic factors. |
| Keywords: | capital controls, capital flows, China |
| JEL: | F21 F41 F42 G28 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bofitp:52023&r=cna |
| By: | Kawamata, Takahiro |
| Abstract: | The struggle for technological supremacy between the U.S. and China that has emerged over the 5G mobile network has spread to various aspects of the international community, ranging from issues of national security to the protection of personal information. Originally, information and communication technology were closely related to national military technology, and it can be said that the development of this technological field has changed the form of warfare in the past world wars and in the postwar Cold War structure. Today, this field is being extended to include not only outer space but also cyberspace as a new area of conflict. On the other hand, in the economic realm as well, real space is becoming more integrated with virtual space, and as virtual space is swallowing up real space, VR, AR, and the world of the metaverse are becoming more expansive. This struggle for hegemony over the information and communication technology (ICT) domain is transcending national frameworks and revealing a structure in which global markets incorporate local climates, creating geopolitical and economic conflicts of principles and values. Bloomer (2021) describes a geopolitical situation in which big tech companies are emerging as players in the U.S.-China conflict and the world order, where "globalism" (Apple, Google, Facebook) and "nationalism" (Amazon, Microsoft / Alibaba, ByteDance, Huawei) and "techno-utopianism" (Tesra). In addition to these players, however, suppliers of digital products, services, and information flows to build information and telecommunications infrastructures include Ericsson and Nokia in Europe, Samsung in Korea, Huawei in China, and the semiconductor industry supply chain in Taiwan, as well as in Europe, the United States, Japan, and China. The supply chain of Taiwan's semiconductor industry, along with those of Europe, the U.S., Japan, and China, is also influencing technonationalism. This paper analyzes and discusses the balance of power among nations over technological hegemony in the industrial ecology and geopolitical economics power structure issues of information and communication technology using an international political economy approach. |
| Keywords: | Technological Hegemony, International Political Economy, Structural Powers, "Big Tech (Platformers)", GPT (General Purpose Technology), "Technosocialism" |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277985&r=cna |
| By: | Bogdanova, Iryna |
| Abstract: | Abstract The US-China trade war and looming ‘technological de-coupling’ instigated major revisions of Chinese laws and regulations. These recent amendments represent a major shift in the role assigned to export restrictions. In particular, China is more willing than before to use export restrictions as a geopolitical tool. To test the veracity of this assertion, this chapter analyses China’s use of export restrictions in the period from 2001 to 2021. It suggests that three distinct phases can be discerned: (i) the elimination of export restrictions before and after joining the WTO; (ii) the selective use of export restrictions for domestic policy reasons; and (iii) a shift toward strategic use of export restrictions as an instrument of geopolitical competition. Several implications flow from this new development: it endangers existing supply chains, may bifurcate the global economy by sapping its growth potential and contributes to the erosion of the multilateral trading system. About the author Iryna is a Postdoctoral Researcher and a recent PhD graduate from the World Trade Institute, University of Bern, where she worked for the project Towards a Principle of Common Concern in Global Law under the supervision of Professor Thomas Cottier. Her thesis explores the legality of unilateral economic sanctions, i.e. those imposed by individual states without authorization of the United Nations Security Council, under international law. This research was financed by the Swiss National Science Foundation, and it came out as a book in July 2022. Over the course of past years, Iryna has steadily published contributions analysing various aspects of economic statecraft and summarizing the most recent developments in this field. Between 2017-2019, she has presented her work at various academic events, including conferences organized by the University College London, the Nottingham International Law and Security Centre and the Amsterdam Center for International Law. Currently, she is preparing a report on malicious behaviour in cyberspace and unilateral cyber sanctions - to be presented at the upcoming Cybersecurity Law and Policy Scholars Conference hosted by the University of Minnesota Law School in October 2021. Iryna graduated from the Master of International Law and Economics (MILE) program at the World Trade Institute in 2015. Before that, she received her Bachelor’s and Master’s diplomas as a top-ranking student of the law faculty of the National University of Kyiv-Mohyla Academy, Ukraine. Iryna’s previous working experiences are diverse and range from work in the private sector to work in international organizations. In 2015 she worked as a consultant at one of the leading European law firms in Brussels, where she gained valuable practical experience in the field of international trade law. In 2016 Iryna was a legal intern at the Appellate Body Secretariat of the World Trade Organization, and in this capacity, she assisted the legal team with the appeals. Prior to that, Iryna worked as a legal and corporate affairs manager for a multinational corporation in Ukraine (2012-2014). Iryna’s research interests include international trade law and policy, collective and unilateral economic sanctions and their effectiveness, use of economic coercion to convey moral norms, economic sanctions and international law, regulation of emerging technologies and impact of disruptive technologies on international economic law. Iryna’s publications can be accessed here. |
| Date: | 2023–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:wti:papers:1408&r=cna |