|
on China |
| By: | Yuqing Xing (National Graduate Institute for Policy Studies, Tokyo, Japan); Peihao Yang (China Electronics Standardization Institute, Beijing, China); Kun Cai (University of International Business and Economics, Beijing, China); Zhi Wang (Institute of Global Development, Tsinghua University, Beijing, China; Schar School of Policy and Government, George Mason University, USA) |
| Abstract: | This paper examines supply-chain localization, domestic value capture, and technological dependence in Chinese electric vehicles using product-level teardown evidence from two representative battery-electric models: the BYD Seal and the Tesla Model 3 manufactured in Shanghai. We identify Tier-1 suppliers, classify them by location and ownership, allocate bill-of-material costs across major subsystems, and adjust domestic content using sector-level value-added and import coefficients from China’s 2023 input-output table. The results show that the supply chains of both vehicles are highly localized in China: 90.8% of BYD Seal suppliers and 96.7% of Tesla Model 3 suppliers are located in China. The estimated domestic value-added share is 82.9%–90.4% for the BYD Seal and 51.3%–57.9% for the Tesla Model 3. Chinese firms dominate batteries and several core EV subsystems, but foreign suppliers remain dominant in advanced automotive semiconductors, especially computing, memory, sensor, and microcontroller chips. The findings highlight both the depth of China's EV supply-chain capability and its remaining technological bottlenecks. |
| Keywords: | electric vehicles (EVs), global value chains (GVCs), value added, industrial policy, technological independence, China |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:ngi:dpaper:26-4 |
| By: | Chen, Ziyang; Combes, Pierre-Philippe; Démurger, Sylvie; Liu, Xiuyan |
| Abstract: | We document variations in real income for high-skilled, low-skilled, and rural migrant households across Chinese cities. Using comprehensive data on land parcel transactions along with individual data for land development and household expenditure, we construct a city-specific housing cost index and assess how it varies across locations. All three components of housing costs –unit land prices, land share in construction, and housing share in expenditure– decrease from city centres to the periphery, increase with city population, and decrease with city land area, as predicted by theory. Overall, housing costs in China are high and vary widely between locations. While income gains outweigh housing costs when moving from smaller to larger cities, in the largest cities, housing costs begin to dominate, particularly for low-skilled and rural migrant households. This suggests a bell-shaped relationship between real income and city population in China, aligning with theoretical predictions. |
| Keywords: | Housing costs; Income disparities; Land use regulation; City size; Quality of life; Agglomeration economies; China |
| JEL: | O18 R21 R23 R31 R52 O53 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20011 |
| By: | Kerola, Eeva; McCully, Tuuli; Nuutilainen, Riikka |
| Abstract: | This paper examines whether China has reallocated import sourcing away from West-leaning economies amid heightened geoeconomic tensions and a policy push to strengthen supply chain security. Using monthly bilateral trade data for 121 economies over 2015-2025 and a difference-in-differences framework, we compare changes in countries' shares of China's imports across blocs defined by their official positioning on Taiwan. We find evidence of a relative decline in imports from Westleaning countries beginning in 2018, with divergence strengthening after 2020 and intensifying further in 2022. The pattern is concentrated on a limited set of rawmaterial sectors, especially mineral products and base metals. For goods covered by Western export controls to Russia, we find no evidence of a broader shift in China's sourcing. Overall, China's import realignment appears broad-based across West-leaning source countries, but has so far remained selective across product categories. China's shift toward importing from friendly nations is likely to contribute to larger bilateral trade surpluses with Western economies, provided that China's exports to these markets remain robust. |
| Keywords: | China, international trade, supply chains, fragmentation |
| JEL: | F12 F13 F14 F51 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:bofitp:342408 |
| By: | Guan, Hanhui; Karaman, Kivanc; Palma, Nuno; Xu, Zhiyin |
| Abstract: | We examine the fiscal trajectory of the Chinese state from the late Qing period to the founding of the People’s Republic of China. To do so, we construct the first continuous tax revenue and public debt series and interpret the trends in the context of the era's political and economic developments. Our findings indicate that China's state capacity remained low throughout this period, a pattern that reflects the central government’s failure to monopolize control over violence. This persistent weakness had lasting consequences, not only shaping the political landscape but also hindering economic modernization. |
| Keywords: | State capacity; Fiscal capacity; Public debt; Taxation |
| JEL: | N15 N25 N45 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20131 |
| By: | , KuoRayMao; Zhang, Qian; Weeks, Nefratiri |
| Abstract: | Environmental justice for China’s rural populations is especially important in the context of China’s multifaceted environmental crises as existing disparities have exacerbated the unequal distribution of economic wealth and environmental harm between rural and urban communities. This chapter examines two environmental intervention programs in China to evaluate environmental justice outcomes under authoritarian environmentalism. Based on 136 in-depth interviews as well as government documents, official statistics, and reports from state-owned media in China between 2009 and 2016, our research demonstrates that the exertion of authoritarian state power in green transition may worsen environmental inequalities and dispossess the underprivileged rural populace in China. The findings indicate that just transition in China requires a multi-scalar examination on how state-led economic development initiatives and the material interests of the centralized bureaucracy shape the formulation and implementation of conservation programs and environmental regulation. We suggest that instead of viewing local communities as problems to be fixed by arbitrary administrative measures, the central state should utilize government organized NGOs affiliated with national ministries and grassroots environmental NGOs to incorporate community-based perspectives into program formulation and implementation. Institutional innovations that reconceptualize authoritarian state environmental intervention as constant responses and adjustments involving multiple stakeholders will be essential for just transitions in China and beyond. |
| Date: | 2026–07–24 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:wgjbq_v1 |
| By: | Chen, Qiaoyi; Ryan, Nicholas; Xu, Daniel Yi |
| Abstract: | We study carbon offsets sold by firms in China under the Clean Development Mechanism (CDM).We find that offset-selling firms, meant to cut carbon emissions, instead increase them by 49% after starting an offset project. In a model of firm investment decisions and offset review, we estimate that CDM firms increase emissions due to both the selection of higher-growth firms into projects (35 pp) and because offset projects themselves boost firm growth and therefore emissions (14 pp). The CDM reduces global surplus by causing damages from increased emissions four times greater than private gains from trade in the offset market. |
| Keywords: | Carbon offsets |
| JEL: | Q56 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20126 |
| By: | Rodriguez-Clare, Andres; Ulate, Mauricio; Vasquez, Jose P. |
| Abstract: | We use a dynamic trade and reallocation model with downward nominal wage rigidities to quantitatively assess the economic consequences of the recent increase in the U.S. tariffs on imports from Mexico, Canada, and China, as well as the “reciprocal†tariff changes announced on “Liberation Day†and retaliatory measures by other countries. Higher tariffs trigger an expansion in U.S. manufacturing employment, but this comes at the expense of declines in service and agricultural employment, with overall employment declining as lower real wages reduce labor-force participation. For the United States as a whole, real income falls around 1% by 2028, the last year we assume the high tariffs are in effect. Importantly, our analysis disaggregates the U.S. into its 50 states, while incorporating cross-state redistribution of the tariff-generated fiscal revenue, allow- ing us to analyze which states gain or lose more from the shock. Around half of the states lose, with some states experiencing real income declines of more than 3%. Turning to cross-country results, some close U.S. trading partners—like Canada, Mexico, China, and Ireland—suffer the largest real income losses. |
| Keywords: | Canada; Mexico; China |
| JEL: | F10 F11 F13 F16 F40 F42 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20246 |
| By: | Kai Liu, Xiangqing Liu, Anwen Zhang and Zhongliang Deng |
| Abstract: | This paper examines the cultural component of son preference through rural-to-urban migration in China, using a large representative dataset covering migrants from all origins to all destinations. Employing a generalized Roy model with a control function approach, we show that conventional epidemiological-approach estimates overstate cultural persistence. Correcting for endogenous destination selection reduces the estimated effect of origin-specific son preference on migrants’ fertility behavior by 57–71%. Differences among migrants in the same destination therefore reflect both cultural influences and non-random sorting. We further find that cultural persistence weakens in higher-income destinations but strengthens in areas with greater migrant concentration. |
| Keywords: | Son preference; cultural persistence; endogenous migration; destination selection; fertility behavior; sex ratios; rural-to-urban migration; China |
| JEL: | J13 J61 Z13 |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:gla:glaewp:2026_05 |
| By: | Chen, Natalie; Novy, Dennis; Solórzano, Diego |
| Abstract: | In 2018 and 2019, the US administration increased tariffs on imports from China. Did these tariffs lead to more US imports from other countries such as Mexico? Using highly disaggregated data on the universe of Mexican firm-level exports, we find evidence of trade diversion from China to Mexico. We then combine the export data with detailed longitudinal employer-employee data to investigate the impact of trade diversion on labor market outcomes for workers employed by Mexican exporters. We find that trade diversion increased the labor demand of exporters exposed to US tariffs against China, resulting in more employment and higher wages, especially for low-wage workers such as female, unskilled, younger, and non-permanently insured employees. The effects were concentrated in technology and skill-intensive manufacturing industries. |
| Keywords: | Employment |
| JEL: | F12 F14 L11 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20296 |
| By: | Cavalcanti, Tiago; Ogeda, Pedro; Ornelas, Emanuel |
| Abstract: | We examine the indirect effects of the US-China trade war on Brazil’s labor market. Using industry-specific tariff changes and the sectoral employment distribution across local labor markets, we construct a measure of regional exposure to the trade conflict. Following higher exports to China, our findings reveal that regions more exposed to Chinese retaliatory tariffs on US exports experienced a relative increase in formal employment and wage bills. In contrast, American tariffs on Chinese exports had no significant impact on Brazilian labor markets. These results contribute to a better understanding of the intricate worldwide implications of bilateral trade wars. |
| Keywords: | Trade war; Trade diversion; Local labor markets; Brazil |
| JEL: | D31 F14 F16 F66 J23 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20161 |
| By: | Becker, Sascha O.; Panin, Amma; Pfaff, Steven; Rubin, Jared |
| Abstract: | This chapter examines the role of religion in economic development, both historically and today. Religion's influence varies globally, with high religiosity in countries like Pakistan and low rates in China. Despite declines in some Western countries, religion remains influential worldwide, with projected growth in Muslim populations due to higher fertility rates. Religion continues to shape societal norms and institutions, such as education and politics, even after its direct influence fades. The chapter explores how religious institutions and norms have impacted economic outcomes, focusing on both persistence and decline. It also examines cultural transmission, institutional entrenchment, networks, and religious competition as mechanisms sustaining religion's influence. We explore the relationship between religion and secularization, showing that economic development does not always reduce religiosity. Lastly, the chapter highlights gaps in the literature and suggests future research areas on the evolving role of religion in economic development. |
| Keywords: | Religion; Religiosity; Secularization |
| JEL: | D85 I25 J10 N30 O33 O43 P48 Z10 Z12 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20027 |
| By: | Fernández-Villaverde, Jesús; Li, Yiliang; Xu, Le; Zanetti, Francesco |
| Abstract: | We examine the rise of dark shipping -- oil tankers disabling AIS transceivers to evade detection -- amid Western sanctions on Iran, Syria, North Korea, Venezuela, and Russia. Using a machine learning-based ship clustering model, we track dark-shipped crude oil trade flows worldwide and detect unauthorized ship-to-ship transfers. From 2017 to 2023, dark ships transported an estimated 7.8 million metric tons of crude oil monthly -- 43\% of global seaborne crude exports -- with China absorbing 15\%. These sanctioned flows offset recorded declines in global oil exports but create distinct economic shifts. The U.S., a net oil exporter, faces lower oil prices but benefits from cheaper Chinese imports, driving deflationary growth. The EU, a net importer, contends with rising energy costs yet gains from Chinese demand, fueling inflationary expansion. China, leveraging discounted oil, boosts industrial output, propagating global economic shocks. Our findings expose dark shipping's central role in reshaping oil markets and macroeconomic dynamics. |
| JEL: | C32 C38 E32 Q43 R40 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20009 |
| By: | Zhang, Linzhi |
| Abstract: | Amidst the growing interest in Chinese women artists’ feminist interventions, this article delves into a less-explored theme in their artistic practices: labour. Through a close examination of two artists’ critical engagement with women’s labour in China, I highlight their Marxist feminist concerns. The first artist, Hu Yinping, creates a work utopia that ensures work autonomy for her mother who had taken on precarious part-time jobs after being laid off. The second artist, Feng Lin, appropriates ready-mades derived from a housewife’s life for her critical enquiry into whether domestic labour or home truly shields women from capitalist relations. It is argued that the two artists make women’s problems with work visible in a post-socialist China, where women’s labour becomes increasingly devalued, less conspicuous, and more precarious. Furthermore, both artists experiment with alternatives to capitalist commodified labour. However, it becomes apparent that Hu Yinping cannot sustain her utopian vision without selling her labour as an artist, and Feng Lin demonstrates that a housewife cannot fully escape the capitalist imposition of work. Ultimately, the interventions of these artists serve as a dual critique of capitalist labour and a revelation of its totality. |
| Keywords: | artistic labour;contemporary Chinese art;gender;labour;Marxist feminism;women artists |
| JEL: | R14 J01 |
| Date: | 2024–12–25 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:140272 |
| By: | Benguria, Felipe; Novy, Dennis |
| Abstract: | How can a currency achieve more widespread international use? We study the internationalization of the Chinese renminbi (RMB) through the lens of a unique policy experiment in Argentina. In 2023, amid a severe dollar shortage, Argentina expanded a currency swap line with the People's Bank of China. Within the next few months, the share of imports from China invoiced in RMB surged rapidly to nearly 50% - displacing the US dollar, which had previously accounted for virtually all invoicing. Following the presidential election of late 2023, as macroeconomic policies changed and the dollar shortage eased, invoicing in RMB declined. We explore the mechanisms behind this aggregate pattern, using rich firm-level data on imports, bank-firm loan relationships, and bank balance sheets. Our results indicate that banks played a key role, in line with the dollar shortage narrative. First, firms with pre-existing relationships to banks with limited US dollar loans were more likely to switch to RMB. Second, firms borrowing from a Chinese state-owned bank were significantly more likely to use RMB. We also document firm-level spillovers, with RMB use for imports from China increasing the likelihood of RMB use for imports from other countries. Finally, we observe an effect on trade volumes. Firms switching to RMB saw increased total imports. |
| Keywords: | Banking; China; Geoeconomics; Invoicing; Renminbi; Swap; Trade |
| JEL: | E58 F14 F31 F33 G21 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20311 |
| By: | Da, Yabin; Chen, Yuanyuan; Qiu, Huanguang |
| Abstract: | China generates more than 3.8 billion tons of livestock and poultry manure annually, making manure one of the most important sources of agricultural nonpoint-source pollution. Since 2017, China has implemented a county-wide manure resource utilization pilot program, supported by substantial central fiscal transfers, to promote crop-livestock recycling, manure treatment facilities, and water-quality improvement. Yet water quality has not improved uniformly in key river basins, and several indicators have increased rather than declined. This paper treats the county-wide manure utilization pilot in Sichuan Province as a quasi-natural experiment and combines county-level panel data on lake and reservoir water quality from 2014 to 2023 with staggered difference-in-differences estimators. To separate local treatment effects from basin-level spillovers, we construct directed hydrological spatial weights from high-resolution digital elevation model (DEM) analysis of upstream-downstream runoff relationships. The results show strong indicator-specific heterogeneity. The policy significantly reduces total phosphorus (TP) and the permanganate index (PI), but increases total nitrogen (TN) and conductivity (Cond) in both lakes and reservoirs. Mechanism tests suggest that treatment facilities generate abatement benefits, while pilot counties also experience a substantial expansion in livestock scale, offsetting part of the environmental gains through additional nitrogen and dissolved-ion loads. Heterogeneity tests show larger nitrogen and ion-migration risks in areas with weaker cultivated-land carrying capacity, stronger precipitation-driven runoff, and better irrigation conditions. DEM-based spillover estimates further show that upstream pilots improve downstream composite water quality while increasing downstream TN, turbidity, and conductivity, consistent with selective abatement and pollution shifting. The paper contributes a hydrologically directed policy-evaluation framework for agricultural environmental regulation and provides evidence for basin-scale coordination in manure management. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404484 |
| By: | Godehardt, Nadine; Zhang, Xin |
| Abstract: | The Chinese leadership has implemented various official directives, plans, and policies that are, step-by-step, coalescing into a comprehensive architecture of volumetric statecraft. Volumetric power integrates spaces such as the atmosphere, the deep sea, the polar regions, the (geological) subsoil, or outer space into political governance. Volumetric states develop special economic and techn(olog)ical capacities to gain control of, and even govern, these spaces. Volumetric statecraft implies the Chinese state's willingness and capacity to integrate various policy dimensions into a set of comprehensive ecosystems. China's 15th Five-Year Plan specifically manifests the volumetric dimension in Chinese governance. This directly impacts the type of challenge that China will pose to the European Union (EU) in the coming years, and it will force the EU to adapt a volumetric strategy of its own towards China. |
| Keywords: | 15th Five-Year Plan, volumetric statecraft, volumetric turn, volumetric power, New Frontiers, New Strategic Splaces, Emerging domains, New Territories, AI Plus, AI+, strategic emerging industries, new qualitiy productive forces, Global Governance Initiative, GGI, Zheng Shanjie |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpcom:341971 |
| By: | Xue, Melanie Meng; Zhang, Boxiao |
| Abstract: | We study the short- and long-term effects of affirmative action policies in the context of China. During imperial China, official positions were awarded to the most academically talented individuals through a multi-stage examination process administered by the central government. In 1712, a reform was implemented to address disparities in exam performance, aiming to equalize acceptance rates across provinces and increase representation from underrepresented regions. Using a unique dataset, we analyze career outcomes and find that more candidates from underrepresented provinces secured positions without compromising their performance after the reform. However, sub-provincial units showed different trends. Although the reform ended in 1905, the gap between underrepresented provinces and others widened again, but some effects of the reform remained. Moreover, the intervention had spillover effects, extending its impact to secondary education. |
| Keywords: | Education; Inequality; China |
| JEL: | H75 I28 J71 N40 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20187 |
| By: | Chen, Zhang-Hangjian; Derwall, Jeroen; Gao, Xiang; Koedijk, Kees |
| Abstract: | This paper presents macro-, meso-, and firm-level measures of biodiversity risk specific to the Chinese capital market, and investigates how biodiversity risk relates to individual stock returns. Our measures indicate that biodiversity risk in China varies over time and across industries, and that aggregate attention to biodiversity issues has risen sharply over the past two decades. We then provide new evidence that corporate biodiversity risk exposure negatively relates to stock returns in the cross-section, significantly more so when aggregate attention to biodiversity issues rises and industry-level biodiversity risk increases. Furthermore, we obtain some evidence that weekly returns on a portfolio long (short) on stocks with low (high) biodiversity risk positively covary with contemporaneous shocks to aggregate biodiversity attention, although negatively with lagged shocks to attention. In addition, institutional ownership is lower when firms appear more vulnerable to biodiversity risk, even more so in years of rising attention to biodiversity. |
| Keywords: | Biodiversity risk; Stock returns; Official news; Investor perception; Internal governance |
| JEL: | G10 G11 G12 Q5 Q53 Q57 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20066 |
| By: | Alfaro, Laura; Brussevich, Mariya; Minoiu, Camelia; Presbitero, Andrea |
| Abstract: | Finding new international suppliers is costly, so most importers source inputs from a single country. We examine the role of banks in mitigating trade search costs during the 2018-2019 U.S.-China trade tensions. We match data on shipments to U.S. ports with the U.S. credit register to analyze trade and bank credit relationships at the bank-firm level. We show that importers of tariff-hit products from China were more likely to exit relationships with Chinese suppliers and to find new suppliers in other Asian countries. To finance their geographic diversification, tariff-hit firms increased credit demand, drawing on bank credit lines and taking out loans at higher rates. Banks offering specialized trade finance services to Asian markets eased both financial and information frictions. Tariff-hit firms with specialized banks borrowed at lower rates and were 15 pps more likely and 3 months faster to establish new supplier relationships than firms with other banks. We estimate the cost of searching for suppliers at $1.9 million (or 5% of annual sales revenue) for the average U.S. importer. |
| Keywords: | Financial frictions; Bank lending; Supply chains; Trade policy |
| JEL: | G21 F34 F42 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20164 |
| By: | Amodio, Francesco; Chiovelli, Giorgio; Frache, Serafin |
| Abstract: | We show that commodity export booms can propagate up the value chain, reshape production networks, and promote growth in the service sector. We study Uruguay’s beef export boom to China in the 2010s, combining customs, firm-to-firm transactions, employer-employee, and balance sheet data. Firms more linked to exporters experienced higher sales, especially in services, with associated gains in employment, wages, and sales per worker. Aggregate sales rose by 1.79%, with each export dollar generating 46 more cents in domestic sales, 10 cents in services. Over time, service firms reoriented their connections toward beef exporters, amplifying their gains from trade. |
| Keywords: | Commodity exports; Production network; Services; China shock |
| JEL: | F14 L14 O14 O54 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20078 |
| By: | Ziang Qiu (Faculty of Business Administration, University of Macau); Baibing Huang (School of Liberal Arts, Macau University of Science and Technology, Macao SAR, China); Yang Zhang (Faculty of Business Administration, University of Macau; Asia-Pacific Academy of Economics and Management, University of Macau, Macao SAR, China) |
| Abstract: | The development of the digital economy has the potential to impact resource allocation efficiency within a region. This study examines the direct and spatial effects of digital economy development on the location choice of foreign direct investment (FDI) in Chinese cities. The findings indicate that digital economy development not only enhances the inflow of foreign direct investment within a region but also influences FDI inflows in neighboring regions, with spillover effects diminishing as geographical distance increases. To address endogeneity concerns, staggered Difference-inDifferences (DID) and spatial DID models are introduced in an event study to validate our main findings. Moreover, regional heterogeneity analysis reveals that the impact of digital economy development on FDI location decisions is particularly significant in eastern and coastal cities. The results offer an empirical foundation for emerging market countries, such as China, to advance sustainable digital economy development, enhance resource allocation efficiency, and support foreign investors in making informed investment location decisions. |
| Keywords: | Digital Economy; FDI Location; Spatial Effect; Spillovers; Emerging Markets |
| JEL: | F23 O33 R12 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:boa:wpaper:202642 |
| By: | Ku, Hyejin; Mu, Tianrui |
| Abstract: | This paper examines how China’s growing research capabilities impact global research universities across scientific fields. Using bibliometric data from 1980 to 2020, we assess the effects of the “China shock†on high-impact publications, novel concepts, and citation patterns. Our analysis reveals a positive net effect in Chemistry and Engineering & Materials Science (EMS), but a negative effect in Clinical & Life Sciences (CLS). In other fields, the effects are mostly positive but imprecise. We highlight the coexistence of competition and spillover effects, with their relative strength shaped by field characteristics, such as expansion potential and the quality of China’s research. |
| JEL: | J24 I23 O31 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20191 |
| By: | Gilberto Libânio (Cedeplar/UFMG); Diana Chaib (Cedeplar/UFMG); Eric Serbinenko (Cedeplar/UFMG); Monique Botelho (UFMG) |
| Abstract: | This article examines China’s green transition from a political economy perspective, emphasizing the interaction between the developmental state, Five-Year Plans, and multilevel governance arrangements. It argues that China’s capacity to advance decarbonization and productive restructuring is rooted in the combination of long-term strategic planning, decentralized implementation, and policy instruments such as green finance, carbon markets, and pilot zones. By integrating top-down coordination with bottom-up experimentation, this framework has supported the expansion of renewable energy, technological upgrading, and improvements in green complexity indicators. At the same time, the persistence of high emission levels and carbon-intensive sectors highlights the non-linear and contradictory nature of the transition process. The Chinese experience thus provides relevant, albeit not directly replicable, insights for the design of sustainable development strategies in Global South economies. |
| Keywords: | Green transition; China; Developmental state; Environmental policy. |
| JEL: | O44 Q58 P21 O53 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:cdp:texdis:td698 |
| By: | Liang, Xiaomeng; Yang, Chenyujing; Xue, Yongji |
| Abstract: | Balancing ecological restoration and grain production is a central challenge in sustainable land management, particularly in arid and semi-arid regions. Large-scale ecological engineering programs are often perceived as potentially limiting agricultural output due to land-use competition; however, causal evidence regarding their long-term impacts and underlying mechanisms remains limited. This study examines whether and how China’s Three-North Shelter Forest Program (TNSFP) influences grain production. Guided by the social–ecological systems framework and ecosystem-services theory, we hypothesize that ecological restoration enhances agricultural output through improvements in ecosystem services rather than by crowding out cropland. Using county-level panel data from 2000 to 2022, we employ a difference-in-differences (DID) model, parallel trend test, placebo test, and multiple robustness checks to estimate causal effects. Mechanism analysis integrates grain production data with satellite-derived vegetation indices, air quality indicators, and ecosystem quality measures. Our results indicate that the TNSFP significantly increases county-level grain production, with effects robust to controls for agricultural inputs, climate, and socioeconomic conditions. Mechanism analyses reveal that enhanced vegetation cover, improved air quality, and overall ecosystem quality jointly promote grain production. Significant regional heterogeneity is observed: the policy effect is stronger in Northeast and North China, positively moderated by cropland area and negatively moderated by the relief degree of land surface. These findings provide new causal evidence that ecological restoration can achieve synergistic gains in land restoration and food production, offering practical implications for sustainable land management in dryland regions. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404477 |
| By: | Franziska Tinnefeld (Università Cattolica del Sacro Cuore and Fondazione Eni Enrico Mattei); Florian Wagener (Universiteit van Amsterdam) |
| Abstract: | We develop a multi-region, multi-sector Romer-type dynamic partial equilibrium model of endogenous growth. We calibrate on equally sized regions North, East, and South, based on data from Germany, Poland, and China. We compare the effect of trade block formation on innovation outcomes. Integration leads to aggregate increase in both product and process innovation, resulting in aggregate welfare gains. These are concentrated in North: the research sectors of East and South collapse. Our findings explain data from eastern European countries, as well as current R&D policies in China that are designed to avoid downstream lock-in. |
| Keywords: | product innovation, process innovation, integration |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2026.20 |
| By: | Cen, Xiao; Fos, Vyacheslav; Jiang, Wei |
| Abstract: | This paper is the first to examine how China’s Five-Year Plans ("Plans'") affect the production allocation of U.S. firms. The Plans represent the highest level of China’s industrial policy, identifying key sectors for state support. Using the U.S. Census Longitudinal Business Database and Plans issued in 2001, 2006, 2011, and 2016, we find significant production displacement among U.S. industries operating in the same sectors targeted by the Plans in China. Over the five years following a sector’s inclusion in a Plan, the corresponding U.S. industries experience a 3.6% reduction in output, a 5.1% drop in employment, a 6.1% decrease in investment, and a 1.0% uptick in factory closure rates. These effects were neither anticipated by the stock market nor reflected in forward-looking firm decisions such as investment and job postings at the time. Some U.S. firms, however, successfully adapt by reallocating production toward "beneficiary" industries — those upstream or downstream of the targeted sectors — or by offshoring to the favored sectors within China. Such adjustments are enabled by preexisting productivity, sectoral and geographic footprints, financial access, and labor market flexibility. This study contributes to the ongoing policy debate on how best to support domestic firms and the broader economy in the face of global shocks, particularly those driven by foreign government intervention. |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20289 |
| By: | Pan, Cong; Yuan, Shuang; Wu, Yongyang; Zhao, Qiran |
| Abstract: | Population aging is transforming rural households across developing countries, yet limited evidence exists on how it reshapes consumption across the distribution. This study examines the association between household aging and per capita consumption in rural China using 350, 351 household-year observations from the Fixed Observation Rural Survey for 2003–2022. We measure household aging as the share of members aged 60 or above within the realized household consumption unit, capturing demographic change as it is experienced in rural households shaped by migration and co-residence. Empirically, we combine household fixed-effects models with unconditional quantile regressions to estimate both average and distributional associations. We find that household aging is associated with lower per capita consumption and that the negative association becomes substantially stronger toward the upper tail of the distribution, indicating compression from above rather than improvement at the bottom. Category-specific results show that contraction is concentrated in discretionary and relatively income-elastic spending, whereas health expenditure is comparatively rigid and may increase with aging. Additional analyses suggest that this pattern is consistent with declines in income capacity, asset-based wealth and informal support. Larger households and households with more farmland exhibit weaker agingrelated consumption losses. The findings show that population aging is reshaping not only average demand but also the composition and distribution of rural consumption under incomplete welfare provision, and they highlight the importance of household structure and rural resource buffers in shaping how aging is lived and managed in the countryside. |
| Keywords: | Consumer/Household Economics, Labor and Human Capital |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404605 |
| By: | Carreras-Valle, Maria Jose; Ferrari, Alessandro |
| Abstract: | Since 2018, there has been a consistent decline in the distance traveled by U.S. manufacturing imports, reaching a level not observed since 2008. This trend is the result of the substitution away from imports from China and towards imports from closer countries. At the same time, U.S. manufacturing inventory-to-sales ratio has continued to rise. These trends are at odds with the literature, which finds that reductions in the distance of imports are associated with a decline in inventories. We argue that a rise in delivery time risk, driven by longer and more frequent delays and supply disruptions, can reconcile these trends. We do so in the context of a model of global sourcing with stochastic delivery times and inventories. Firms trade off the lower price of farther inputs with the increase in exposure to demand volatility and longer delays. In response, firms increase their inventories. Yet, as delivery delays rise, firms need to carry more inventories per unit of the input used. We calibrate the model for the period from 2018 to 2024 using data on the increase in tariffs for inputs from China, and the rise in inventories over sales. We find an increase in delivery delays for foreign inputs of 21 days across the period. The rise in delays and tariffs had an output loss of 7.3% and a price increase of 1.8%. Of these, the rise in delivery delays alone generated a 2.6% drop in output and a 0.4% increase in prices. |
| Keywords: | Inventories |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20136 |
| By: | Lorenzo Rotunno; Michele Ruta; Priyam Verma |
| Abstract: | This paper examines the global trade and welfare effects of industrial subsidies, employing a multi-country, multi-sector general equilibrium trade model with economies of scale. We first estimate the magnitude of industrial subsidies across countries relying on a novel approach that exploits information on subsidy counts during the period 2015-23. We then quantify the impact of the implied subsidy rates on trade flows and find that subsidies boost net exports in strategic sectors especially for China, while causing export declines in competing economies. Subsidies by the EU and the US produce qualitatively similar but smaller effects, as these economies target relatively more non-strategic sectors. A decomposition of the trade effects highlights the role of economies of scale and productivity changes in explaining sectoral specialization in response to subsidies. Tariff actions in 2018-19 and since 2025 partly offset these trade patterns. While targeting strategic sectors, recent subsidies and import tariffs lower global welfare by creating distortions and negative cross-border externalities. |
| Keywords: | Industrial Policy; Trade Spillovers; sectoral imbalances; Geoeconomics |
| Date: | 2026–07–24 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/155 |
| By: | Tan, Zhaofeng; Zhu, Xinlei; Huang, Teng; Liu, Tianjun |
| Abstract: | Existing research on how environmental policy affects firm dynamics has focused mainly on highly polluting firms. By contrast, there is still limited evidence on how such policies shape the entry and exit of green agribusiness. This paper studies a Chinese agricultural environmental policy that combines regulation with incentives and was gradually introduced at the county level from 2017 onward. We treat this rollout as a quasi-natural experiment. Using a staggered difference-in-differences design, we identify the causal effects of agricultural environmental policy on the dynamics of green agriculture-related firms. We find that the policy increased entry by about 10.67 percent and exit by about 9.84 percent among green agriculture-related firms. The evidence points to market selection as the main mechanism. The policy increased market demand for green agriculture from both consumers and agricultural producers. It also raised the revenues and profits of incumbent green agriculture-related firms. In addition, the policy reduced informal costs, especially financing frictions, but did not significantly relax formal institutional barriers. Lower entry costs and stronger market expectations increased the expected returns to entry and encouraged green agribusiness to enter. At the same time, intensified competition pushed less efficient firms out of the market. This pattern is especially pronounced among smaller firms, firms with narrower business scopes, less diversified firms, and firms with weaker profitability. The policy also generated both environmental and economic gains. It reduced methane emissions by about 1.06 percent and nitrous oxide emissions by about 1.68 percent. It also increased nighttime light intensity by about 3.57 percent. Overall, this paper provides new micro-level evidence on how environmental policy shapes green agribusines dynamics. It also offers evidence from China that may inform green structural transformation in agriculture in developing countries. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404468 |
| By: | Chao, Zenghui; Gu, Wenhao; Xu, Chenguang; Zhang, Jun |
| Abstract: | This paper studies how cognitive friction shapes rural households’ willingness to lease rooftops for distributed solar photovoltaics. Using double-bounded WTA survey data from 311 households in Pingdingshan, Henan Province, we estimate a two-class latent class model that allows households to follow different information-processing rules. About 66.8 percent of households belong to a policy-familiar class that incorporates return confidence into project valuation. Their mean WTA is 31.03 yuan per square meter per year, compared with 57.38 yuan for the policy-unfamiliar class. Counterfactual simulations show that improving return confidence and policy familiarity can sharply raise participation and substitute for cash subsidies. Raising both to their highest levels increases zero-subsidy participation from 15.1 percent to 88.7 percent and generates substantial annual CO2 abatement. |
| Keywords: | Consumer/Household Economics |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404857 |
| By: | Jahongir Begmatov (The Central Bank of the Republic of Uzbekistan, Uzbekistan); Guanie Lim (National Graduate Institute for Policy Studies, Tokyo, Japan) |
| Abstract: | This paper examines whether differences in reform sequencing during the early reform period are associated with differences in output stability and structural transformation. It compares three transition economies - China (1978-1988), Vietnam (1986-1996), and Uzbekistan (2017-2024) - using a structured comparative case study design. Drawing on the reform sequencing literature, the analysis is organized around the expectation that micro-first sequences, in which agricultural and enterprise reforms precede large-scale macroeconomic and external liberalization, are associated with more stable output and a more balanced pattern of structural change than macro-first sequences. Using data from the World Bank's World Development Indicators, the analysis proceeds through within-case studies and a structured cross-case comparison using descriptive statistics and aligned trend graphs. The patterns observed are broadly consistent with the expectation that sequencing matters. China and Vietnam, which followed micro-first reform sequences, achieved higher average growth rates underpinned by early agricultural productivity gains, avoided negative growth, and exhibited a relatively balanced reallocation of resources across sectors. Uzbekistan's macro-first sequence, which began with exchange rate unification and trade liberalization, also avoided recession, but growth was lower on average and appears to have depended more heavily on expansionary fiscal policy and state-led investment. Structural transformation in Uzbekistan was characterized by rapid industrial expansion without a preceding surge in agricultural productivity, while services expanded more gradually. Labour reallocation patterns and foreign direct investment trajectories reinforce these differences. The paper contributes to the reform sequencing literature by incorporating a contemporary transition into a common comparative framework and offers cautious policy insights for transition economies, particularly regarding the role of micro-level institutional reforms in supporting durable growth and structural transformation. |
| Keywords: | China, Vietnam, Uzbekistan, Reform, Growth, Structural Transformation |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:ngi:dpaper:26-5 |
| By: | Li, Yuan; Dai, Rao |
| Abstract: | Farm scale expansion in smallholder agriculture requires access to land and the capacity to organize production. Under land fragmentation, households that rent in additional land must still organize labor, machinery, timing, and management across dispersed plots. This paper examines whether outsourced agricultural services facilitate farm operational scale expansion in rural China. Using household data from the 2020 China Rural Revitalization Survey and complementary panel evidence from the National Fixed-Point Survey, this paper studies the association between service adoption and three scale-related outcomes: operated land area, number of operated plots, and net land inflow. The empirical analysis combines double/debiased machine learning with instrumental-variable checks, panel-data robustness using the National Fixed-Point Survey, and sensitivity tests for skewed land distributions and initial land endowment. Service adoption is positively associated with operated land area across DML specifications and remains robust to alternative estimators, log and winsorized outcomes, exclusions of upper-tail farms, and controls for initial land endowment. Complementary estimates suggest that service adoption is also associated with fewer operated plots and a higher probability of net land inflow. Mechanism tests using yield per mu and trust provide suggestive evidence that services relax operating constraints and improve the transaction environment. Heterogeneity analysis shows that the association varies by farm size, farmer age, agricultural income dependence, and service type, with management-oriented services showing stronger associations than basic mechanized services. The findings suggest that service markets can complement land rental markets by reducing the post-rental production and coordination costs that constrain scale formation under land fragmentation. |
| Keywords: | Agricultural and Food Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404384 |
| By: | Huang, Teng; Zhang, Xinshuang; Tan, Zhaofeng; Liu, Tianjun |
| Abstract: | The adoption of improved crop varieties has long been a key driver of agricultural transformation in developing countries. While the existing literature has documented the achievements of the Green Revolution, an important question remains unanswered: How do agricultural technologies translate into improvements in individual nutritional outcomes? Are the nutritional benefits associated with improved wheat varieties driven by the grain itself, or by the labor savings they generate? To address this question, we construct an individual-level dataset comprising 45, 278 observations from 49 counties across nine provinces in China over the period 1991–2011. Using a two-way fixed effects model, we find that the adoption of improved wheat varieties significantly increases overall nutrient intake among local residents. In particular, it leads to higher consumption of fat and protein, while having no significant effect on carbohydrate intake.Further analysis reveals that the nutritional benefits of improved wheat varieties do not primarily arise from increased agricultural output or farm income. Instead, improved varieties reduce labor requirements in agricultural production, facilitating the reallocation of agricultural labor to non-agricultural sectors. This labor reallocation, in turn, contributes to improved nutritional outcomes. These findings provide important policy implications for agricultural technology diffusion and structural transformation in developing countries. To maximize the benefits of improved seed technologies, governments should not only promote the adoption of improved varieties but also implement complementary human capital support policies that facilitate labor mobility and non-farm employment opportunities. |
| Keywords: | Consumer/Household Economics, Labor and Human Capital |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404619 |
| By: | Hyun Seok Kim (Korea Institute for Industrial Economics and Trade); Jooyoung Yang (Korea Institute for Industrial Economics and Trade) |
| Abstract: | The United States is pursuing the Agreement on Trade in Critical Minerals (ATCM) with five principal objectives: diversifying critical minerals supply chains, reducing dependence on China, building a preferential trading bloc among allies, establishing a price stabilization mechanism, and setting rules for investment and trade. Washington has designed the agreement as a legally binding plurilateral framework for industrial policy cooperation, intended to sustain and expand the critical minerals production capacity and industrial base of partner countries.<p> The instruments under consideration include a price floor, a common external tariff, minimum import prices, and reference pricing powered by artificial intelligence (AI). Each is meant to counter low-price offensives and overcapacity in specific countries while preserving investment incentives and production capacity among allies. Taken together, they amount to an attempt to build a new allied critical minerals market for critical minerals. Many other countries also see China’s domination of critical minerals supply chains as a major risk, distorting prices and creating major dependency risks, and that diversification is necessary. But not all are on board with Washington’s interventionist instruments: the price floor, the common external tariff, and AI-based pricing are likely to become central points of contention in negotiations.<p> Korea faces a dual dependence: on China for processed critical minerals and on the United States and the European Union as export markets for derivative products. Should the ATCM build a “friendly” supply chain and establish a preferential trading system, Korea stands to diversify its sources of processed critical minerals and to secure steadier access to US and EU markets. But if major suppliers remain outside the agreement, any gains could be offset by new supply chain risks.<p> This study argues that Korea should weigh participation in ATCM as a question of industrial competitiveness and supply chain resilience rather than one of resource diplomacy alone. It recommends a principle of selective and conditional participation in the price floor and the AI-based reference pricing system, coupled with diversification of supply through platforms such as FORGE, expanded recycling and domestic production capacity, and complementary domestic measures covering statistics, monitoring, and strategic stockpiling.<p> This paper was translated from the original Korean using the Claude Opus 5 large language model (LLM). It was professionally edited and reviewed by the author prior to publication. |
| Keywords: | critical minerals; Agreement on Trade in Critical Mineras; ATCM; supply chains; rare earth elements; REEs; lithium; nickel; cobalt; global trade; global value chains; trade policy; trade competition |
| JEL: | F13 Q37 L52 F51 |
| Date: | 2026–07–15 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kietia:023242 |
| By: | Joseph E. Gagnon (Peterson Institute for International Economics); Nishtha Agrawal (Peterson Institute for International Economics) |
| Abstract: | Global trade imbalances have gained attention following President Donald Trump's reelection, with China's trade surplus increasing and the US trade deficit remaining historically high. This paper estimates models that can explain nearly half of the historical imbalances, with a large share of the imbalances arising from government policies. The evidence strongly suggests that governments can buy current account surpluses. The paper extends previous research (Gagnon and Sarsenbayev 2021) by six years and roughly 1, 000 observations. |
| Keywords: | current account, fiscal balance, foreign exchange intervention, official financial flows |
| JEL: | F32 F41 F42 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:iie:wpaper:wp26-13 |
| By: | Jiang, Jing; Fan, Yubing; Tang, Zeng |
| Abstract: | Livestock production has thus become a key pillar of rural revitalization and agricultural modernization. However, herders in China’s pastoral regions face significant risks from natural disasters, wildlife conflicts, and market fluctuations, which threaten income stability and sustainable development. Using survey data from 522 herder households in the Qilian Mountains, this study employs a Double-Hurdle model to examine how herders’ perceptions of natural disaster, wildlife conflict, and market risks affect their livestock insurance purchase decisions and payment amounts. The results reveal that a one-unit increase in overall risk perception raises the probability of purchasing insurance by 34.2% and increases insurance expenditure by 1, 512.1 CNY 2 . Specifically, only natural disaster perception demonstrates a statistically significant effect on insurance expenditure: a one-unit increase in this perception raises the probability of purchasing insurance by 3.0% and increases expenditure by 242.9 CNY. Perceived market risk increases purchase probability by 6.2%, and wildlife conflict risk increases it by 2.9%. Regional heterogeneity is evident: Qinghai herders respond more strongly to natural disaster risks in determining insurance payment amount, whereas Gansu herders are more responsive in their purchase decisions. Across livestock types, natural disaster perception remains the dominant driver of insurance participation and expenditure for both cattle and sheep herders. These findings highlight the importance of tailoring policy-based livestock insurance to regional and behavioral contexts. Strengthening herders’ market risk awareness, improving insurance accessibility and trust, and aligning insurance with ecological conservation policies can enhance participation and promote sustainable pastoral livelihoods. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404779 |
| By: | Gan, Xiaoyu; Patterson, Malcolm; Topakas, Anna; Ng, Kara; Hildenbrand, Kristin |
| Abstract: | Abusive supervision, a harmful pattern of leadership behaviour, has consistently been found to have negative effects in the workplace. Drawing on self-regulation and the work-home resources model, we investigate the daily antecedents of abusive supervision from the work (ego depletion) and nonwork (unhealthy eating) domains. We examine leaders' narcissistic personality as an important boundary condition of the relationship between after-work unhealthy eating and next-day abusive supervision. Using Dynamic Structural Equation Modelling, we analysed daily diary data from 112 leaders and 225 followers across five organizations in China over 10 working days. We find that the work-induced ego depletion of leaders predicts their after-work unhealthy eating behaviours. The relationship between after-work unhealthy eating and next-day abusive supervision is contingent on leader narcissism: it is negative only at high levels of leader narcissistic admiration and positive at all levels of leader narcissistic rivalry, with the effect being stronger at higher levels of rivalry. Leader narcissism also moderates the indirect link between ego depletion and next-day abusive supervision through after-work unhealthy eating (moderated mediation). Our findings demonstrate the work–nonwork–work resource depletion spiral, provide insights into the interplay between daily factors and individual traits, and reveal some nuanced precursors of abusive supervision. |
| Keywords: | abusive supervision;leader narcissism;narcissistic admiration;narcissistic rivalry;unhealthy eating;work-induced ego depletion |
| JEL: | R14 J01 |
| Date: | 2026–07–07 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:138907 |
| By: | Liu, Zhuang; Peng, Wenwei; Wang, Shaoda; Xu, Daniel Yi |
| Abstract: | This paper examines how power lawyers shape judicial and economic outcomes by studying the “revolving door†between judges and lawyers in China’s judicial system — namely, former judges who quit the bench to practice law. In otherwise identical lawsuits, revolving-door lawyers deliver 8 − 23% higher win rate for their clients. Their performance in home versus away courts suggests these gains stem from both “know how†and “know who.†We extend the theoretical framework of Dewatripont and Tirole (1999) to show that revolving-door lawyers create countervailing forces in society: they enhance judicial decision-making through evidence and reasoning, but also exploit strategic arguments and connections to bias outcomes in favor of their clients. We estimate a structural model of the judicial process to quantify these trade-offs and find that increasing the supply of power lawyers can have a non-monotonic effect on equilibrium judicial quality. |
| JEL: | K0 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20145 |
| By: | Lihan Chen; Shaojie Lai; P. Raghavendra Rau; Qing Sophie Wang (University of Canterbury) |
| Abstract: | We study how binding executive pay compression affects managerial behavior and firm outcomes. Using China's 2015 executive pay-cap reform for state-owned enterprises, we compare SOEs with non-SOEs around a policy that sharply reduced executive compensation and limited common substitution channels. Treated firms exhibit lower work effort and CEO engagement, fewer unrelated acquisitions, less risk-related language in disclosure, lower investment, weaker investment efficiency, higher cash holdings, slower cash adjustment, and lower Tobin's Q and total factor productivity. We find little evidence that executives respond by increasing observable perks or tunneling. Instead, the results are more consistent with a passive “quiet life” response, in which weaker monetary incentives reduce managerial initiative and responsiveness. The effects are stronger for older CEOs and in more competitive industries, where performance incentives are likely more salient. CEO turnover rises, especially among high-performing executives, and pay-performance sensitivity declines, suggesting that selection effects and weaker formal incentives reinforce the behavioral response. Treated firms also increase ESG and CSR scores and employment, consistent with greater attention to politically salient outcomes. Overall, the evidence suggests that binding pay compression can generate real efficiency costs even when alternative career, reputational, and political incentives remain in place. |
| Keywords: | Executive compensation, Pay regulation, Managerial incentives, Corporate investment, Firm performance |
| JEL: | G30 G38 J33 M52 |
| Date: | 2026–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:cbt:econwp:26/05 |
| By: | Zhang, Rongcun; Zhang, Yue; Jin, Yanhong; Zheng, Fengtian; Zhang, Man |
| Abstract: | Nutrition information interventions are widely used to improve children’s dietary choices, yet it remains unclear whether they should target children or caregivers. We study this question in a randomized field experiment with 574 child-caregiver pairs in a rural elementary school in China using an incentivized sugar-sweetened beverage (SSB) choice experiment. We compare two student-targeted nutrition education interventions and one caregiver-targeted intervention, and measure both students’ own beverage choices and caregivers’ proxy choices immediately after the intervention and one month later. The student-targeted intervention reinforced with visual cues improves students’ SSB-related knowledge but does not generate robust behavioral change. By contrast, the student-targeted intervention reinforced with peer incentives produces the largest and most persistent improvements in students’ own SSB choices and also generates child-to-caregiver spillovers in caregivers’ proxy choices. The caregiver-targeted intervention improves caregivers’ proxy choices both immediately and one month later, and generates delayed caregiver-to-child spillovers. Spillovers are therefore bidirectional but asymmetric. Heterogeneity analyses show that peer-based effects are stronger among children with greater purchasing autonomy and social ability, whereas caregiver-side responses are stronger in households with greater caregiver engagement and communication. Overall, nutrition education is more effective when it is reinforced by peers on the student side and by changes in household food provision on the caregiver side, highlighting the importance of school-home collaboration. |
| Keywords: | Food Consumption/Nutrition/Food Safety |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404553 |
| By: | Barwick, Panle; Swanson, Ashley; Xia, Tianli |
| Abstract: | Making innovative drugs affordable and accessible is a pressing global challenge. Centralized negotiation is an increasingly popular policy solution, but it remains understudied despite wide variation in implementation. This paper studies China's ongoing NRDL Reform, which combines centralized drug price negotiation with expanded insurance coverage. The reform reduced retail prices by 48% and out-of-pocket costs by 80%, and increased drug utilization by 350%. At the same time, the insurance design was regressive, and 25% of negotiations failed. Focusing on cancer drugs, we estimate a flexible demand and supply model that features heterogeneous households, bargaining with potential breakdowns, and a government objective function that depends on consumer surplus and insurance spending. We estimate that including innovative cancer drugs in the NRDL generated RMB 40 billion ($5.6 billion) in annual consumer surplus gains and increased survival by 900, 000 life-years among Chinese cancer patients each year. Among the counterfactual policies we examined, centralized market-access negotiation with an optimal coinsurance schedule raises social surplus by 19% relative to the observed policy and achieves 90% of the social surplus of an efficient benchmark. |
| JEL: | L0 I0 H0 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20268 |
| By: | Sambit Bhattacharyya; Chirantan Chatterjee; Stephen Lartey |
| Abstract: | How do global crises affect development aid effectiveness? We explore this question by analyzing the impact of 2008 global financial crisis on development aid effectiveness in Africa using a novel triple-difference design (aid by donor x governance quality x trade exposure) estimated pre and post 2008 with nightlights data across 41 African countries observed over the period 2000 to 2021. We find Chinese aid to be effective in well governed and trade exposed countries following the crisis whereas OECD aid lost its governance dependent advantage. Structural break test confirms 2008 as a turning point for Chinese aid effectiveness. Total aid concentration outperforms aid diversification by 79% relative to pre-crisis patterns in terms of effectiveness. US aid appears to be inequality reducing post 2008. Chinese aid seems effective post 2008 irrespective of its modalities 'ODA like' and 'other official flows' whereas US aid is effective only under the modality 'economic'. The results appear to be robust to GDP as an alternative outcome variable and placebo test. |
| Keywords: | foreign aid, economic development, Africa, China |
| JEL: | F35 O19 O47 O55 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:een:camaaa:2026-59 |
| By: | Yurii Sholomytskyi |
| Abstract: | This paper examines the statistical properties of the IMF’s World Economic Outlook (WEO) projections over 1999–2023 for 29 economies. The optimism of WEO growth forecasts is well established; we confirm it and look behind it at two features of how the forecasts are built. First, the growth of the systemic economies (the United States and China) appears to be underutilized in the projections: forecasts embed less of the cross-country growth comovement present in the data, a gap we term forecast fragmentation that did not narrow over the sample. Second, the conditional growth–inflation link present in the historical data is weakly represented in the projections. These patterns suggest that structural models, in which such cross-country and real–nominal linkages can be verified through estimation, could be a useful complement to expert judgment, serving as a baseline check for medium-term anchors. |
| Keywords: | IMF; World Economic Outlook; Forecast error; Optimism bias; Forecast fragmentation |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/164 |
| By: | Kidane, Won L. |
| Abstract: | This Article examines China’s and India’s differing investment treaty and dispute settlement experiences and the resulting implications for Africa. It attempts to answer the question of whether there is evidence of China’s and India’s attempt to take advantage of the default structural imbalance enabled by centuries of international investment laws and institutions that favor the investor. The Article begins by presenting the background of the current economic reality and trends that necessitate the evaluation of the existing rules and institutions. It then presents a detailed assessment of this phenomenon by focusing on the investment cases brought against India for context, followed by a critical appraisal of India’s reaction to the perceived deficiencies of the existing system as evidenced by its new BIT Model Text and the text’s implications for Africa. Next, the Article evaluates the most important body of evidence that comes in the form of bilateral investment treaties, i.e., China’s and India’s investment treaties with African states. Finally, it offers a summary of conclusions. |
| Date: | 2026–07–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:lawarc:2egqd_v1 |
| By: | Disslbacher, Franziska (Vienna University of Economics and Business); Morelli, Salvatore; , Matteo |
| Abstract: | Using the novel GC Wealth Project Data Warehouse, this paper shows that wealth inequality has increased since the early 2000s in roughly 60% of the countries in our sample, although trends are not uniform across countries. While the largest gains in wealth shares accrue to the top 10%, relative losses are borne by the bottom 50% and the middle 40% alike. We reveal substantial variation of estimates across data sources and units of analysis, which complicates international comparison of wealth inequality. Yet, core trends at the country level are generally robust. Individual-based series generally report higher inequality than household-based ones. Regional patterns reveal sharp increases in inequality in Latin America, North America, India, and China, while Europe and Asia-Pacific exhibit more stable trends. Incorporating Forbes billionaire data extends coverage to low-income countries and Africa—where, notably, billionaire wealth relative to GDP has remained stable, marking a distinct exception to global patterns. (Stone Center on Socio-Economic Inequality Working Paper) |
| Date: | 2026–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:xrnpj_v1 |
| By: | Alfaro, Laura; Fadinger, Harald; Schymik, Jan; Virananda, Gede |
| Abstract: | Trade and industrial policies restricting critical inputs can inadvertently promote foreign downstream industries via a directed technological response. We provide evidence for this mechanism by examining rare earth elements (REEs) – critical manufacturing inputs with highly concentrated production and low substitutability. We show that China’s REE export restrictions in 2010 induced a surge in global innovation increasing REE input-efficiency and exports in REE-intensive industries. A quantitative trade model with Heckscher-Ohlin-based comparative advantage, directed technological change and input-output linkages rationalizes how input-supply restrictions induce REE-enhancing innovation and expand REE-intensive industries abroad. This directed technological response substantially mitigates foreign welfare losses. |
| Keywords: | Trade policy; Input-output linkages; Global value chains; Industrial policy; Innovation; Directed technological change |
| JEL: | F13 F14 F42 O33 O47 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20315 |