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on China |
| By: | Timothy J. Kehoe; Xing Xu |
| Abstract: | In the late 1980s, Mexico opened itself to international trade and foreign investment, followed in the early 1990s by China. China and Mexico are still the two countries characterized as middle-income by the World Bank with the highest levels of merchandise exports. Although their measures of openness have been comparable, these two countries have had sharply different economic performances: China has achieved spectacular growth, whereas Mexico’s growth has been disappointingly modest. In this article, we extend the analysis of Kehoe and Ruhl (2010) to account for the differences in these experiences. We show that China opened its economy while it was still achieving rapid growth from shifting employment out of agriculture and into manufacturing while Mexico opened long after its comparable phase of structural transformation. China is only now catching up with Mexico in terms of GDP per working-age person, and it still lags behind in terms of the fraction of its population engaged in agriculture. Furthermore, we argue that China has been able to move up a ladder of quality and technological sophistication in the composition of its exports and production, while Mexico seems to be stuck exporting a fixed set of products to its North American neighbors. |
| JEL: | F43 O32 O47 O57 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34181 |
| By: | Mao, Haiou; Görg, Holger |
| Abstract: | Geographical Indication (GI) is a rising policy in developing countries, which has been relatively neglected in the existing literature. This article studies Chinese agricultural GIs and its impact on firms’ exports. By relating newly authorized GIs with firm‐product‐location‐destination level customs trade data according to GIs’ geographical coverage and product type, we estimate the impact of these new GIs on firm's exports. Importantly, we can distinguish GIs with and without quality supervision. For the latter we find negative impacts on export quality, which is not the case for GIs with quality supervision. We interpret this in the context of our theoretical framework as evidence for quality free‐riding, where individual firms have an incentive to lower the quality of the export product. We show that this negative effect is less, the more concentrated an industry is or the more GIs there are for a particular product. Furthermore, our results suggest that the China‐EU agreement on Geographical Indications may play the role of quality supervision and prevent the possibility of free‐riding. |
| Keywords: | Agricultural Geographical Indications, China, export quality, free-riding |
| JEL: | F10 Q18 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifwkie:323987 |
| By: | Kristina Butaeva; Lian Chen; Steven N. Durlauf; Albert Park |
| Abstract: | This paper examines intergenerational mobility in China and Russia during their transitions from central planning to market systems. We consider mobility as movement captured by changes in status between parents and children. We provide estimates of overall mobility, which involves mobility during transition to a system's steady state, as well as steady state mobility, which captures long-run mobility independent of transitional dynamics or shifts in the marginal distribution of outcomes across generations. We further decompose overall mobility into structural and exchange components. We find that China exhibits more overall educational mobility than Russia mostly due to greater structural mobility, while Russia exhibits greater steady state educational mobility. In contrast, both the overall and steady state occupational mobility is similar in China and Russia. Comparing these results to the US, we find that steady state mobility in education is substantially higher in the US and Russia compared to China, but occupational steady state mobility is comparable in all three countries. |
| JEL: | I24 J62 P2 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34124 |
| By: | liu, kerry |
| Abstract: | The rapid development of Chinese automotive, particularly in the new energy vehicle sector, have garnered global attention. This study focuses on a niche area that has yet to be thoroughly examined: automotive finance. First, it explores the evolution of automotive finance in China within the context of the broader automotive market. Second, it reviews key policy initiatives from Chinese authorities related to the automotive industry, automotive finance companies, and automotive consumption. Third, it analyzes recent regulations on automotive finance companies, concluding that these measures are designed to mitigate systemic risks within China's financial system while supporting the new energy vehicle sector. |
| Date: | 2025–08–22 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:py648_v1 |
| By: | Nisha Taneja (Indian Council for Research on International Economic Relations (ICRIER)); Snajana Joshi; Vasudha Upreti; Nirlipta Rath |
| Abstract: | The trajectory of India-China economic engagement, rooted in a legacy of complex geopolitical ties and asymmetrical economic relations, now stands at a critical juncture amid a changing global order. In this context, Indian Prime Minister Narendra Modi's upcoming visit to China for the Shanghai Cooperation Organisation (SCO) summit carries considerable strategic significance. The thaw in India-China relations offers a timely opportunity to address existing economic imbalances to foster a more balanced engagement along with reducing external vulnerabilities. Amid these shifting global realities, this policy brief explores three key questions: (i) How can India enhance and diversify its exports to China? (ii) What strategies can reduce its import dependence on China? and (iii) How can Chinese FDI be increased with appropriate guardrails? Drawing on an analysis of export trends and untapped potential, patterns of import dependence, and the evolving trajectory of Chinese investment in India, the policy brief identifies policy pathways to enhance export competitiveness, reduce vulnerabilities from concentrated imports, and channel FDI with appropriate guardrails strategies. It also emphasises the need for stronger institutional mechanisms to address non-tariff barriers and product standards. Together, these measures aim to foster a more balanced, secure, and resilient economic partnership between India and China. |
| Keywords: | India Exports, US Tariff Shock, Sectoral Impact, Market Diversification, icrier |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:bdc:ppaper:45 |
| By: | Xinyan Deng |
| Abstract: | This study analyzes the 2018 Chinese Household Income Project survey data to evaluate the income gaps between an "outsider" ethnic minority group, the Mongols, an "insider" ethnic minority group, the Manchus, and the majority Han group in urban and rural areas of Liaoning province and Inner Mongolia in China. Three statistical methods, a simple first-order OLS linear regression, linear regressions with interaction terms, and the Blinder-Oaxaca Decomposition, are used to investigate the income disparity amongst the three groups. The results indicate that Mongols suffer a significant ethnic wage penalty attributable to possible discrimination in the rural areas of these two provinces, while the urban income gaps between the three groups can mostly be explained by participation in public sector occupations or affiliation with the Chinese Communist Party. In rural settings, Mongols also have higher returns to public sector jobs and CCP membership compared to the other two ethnic groups. The findings suggest that Chinese affirmative actions regarding ethnic policy are effective in accelerating the integration of ethnic minorities with Han in the outcomes of the labor market. This conclusion is consistent with previous studies. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.21625 |
| By: | Mayuree Santhadkitjakarn (Chulalongkorn University, Bangkok, Thailand); Somtip Watanapongvanich (Chulalongkorn University, Bangkok, Thailand) |
| Abstract: | This research explores the effects of artificial intelligence (AI) on the labor market across various regions of China, using provincial-level data from 2006 to 2022. To address issues of reverse causality and ensure analytical accuracy, a fixed-effects distributed lag model is employed. The study investigates three key dimensions: total employment, wages, and employment across different skill levels. COVID-19 indicators are included to account for policy changes and economic fluctuations. The results reveal a relationship between the rising adoption of AI and employment opportunities for low- to medium-skilled workers; however, high-skill occupations appear less affected. Evidence also suggests that the integration of AI technologies influences wages, consistent with the assumptions of skill-biased technological change (SBTC). These findings provide empirical confirmation of the disruptive impact of AI on the Chinese labor market, offering insight into how technological advancement affects employment in emerging economies. The study offers guidance for policymakers and corporate leaders addressing labor challenges in an AI-driven economy. |
| Keywords: | AI, Employment Structure, Total Employment, Wage |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:smo:raiswp:0506 |
| By: | Sajid Anwar; Sizhong Sun |
| Abstract: | This paper examines how adverse supply-side shocks in domestic input markets influence firms' vertical outward foreign direct investment (OFDI) decisions. While the theoretical basis for cost-driven OFDI is well established, empirical evidence on the causal mechanisms remains limited. We develop a framework in which input cost shocks raise unit production costs, but firms undertake vertical OFDI only when shocks are sufficiently severe or when baseline costs are already high. Firm heterogeneity leads to a sorting pattern, whereby more productive firms are more likely to invest abroad. To test this mechanism, we exploit China's 2017 waste paper import ban as an exogenous shock and leverage a distinctive feature of the paper product industry's supply chain. Using a difference-in-differences strategy and firm-level data from 2000 to 2023, we find that the policy shock increased the probability of vertical OFDI by approximately 16% in the post-policy period relative to a control group. These results provide robust evidence that firms respond to domestic input shocks by reallocating production across borders, highlighting vertical OFDI as a strategic response to supply-side disruptions. The findings contribute to understanding the micro-foundations of global production decisions in the face of input market volatility. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.21291 |
| By: | Döver, Melike; Middelanis, Martin |
| Abstract: | This paper analyses the structural vulnerabilities of Latin American economies amid recent United States (US)-China tariff escalations and identifies strategic opportunities emerging from these shifts. Based on descriptive bilateral trade data from 2023 for the largest Latin American economies - Argentina, Brazil, Chile, Colombia and Mexico - the study assesses exposure to US tariffs at the industry level. It further highlights sectors with the potential to benefit from diverted trade flows in the context of trade polarisation between China and the US. The degree of exposure varies across countries, depending on export structure and trade partners. While the tariff conflict may enable some countries to expand exports to China or the US, most Latin American economies - except Mexico - export their largest share of their manufactured goods within the region. Strengthening regional trade integration can therefore enhance resilience to external shocks and support technological upgrading. |
| Keywords: | US trade policy, trade policy uncertainty, Latin America, tariff vulnerability, structural trade exposure |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:diedps:324635 |