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on China |
| By: | Charles Kenny (Center for Global Development) |
| Abstract: | This paper examines the changing shape of Chinese investment in Africa, as it evolves from large scale infrastructure toward small scale manufacturing. It looks at the opportunity for the region in the context of a deepening manufacturing labor shortage in China; discusses barriers to that opportunity in both China and the Africa region; and the potential response of Western countries. It may be possible for at least some economies in Africa to benefit from a combination of Chinese investment in manufactured export and processed commodity industries and preferential access to economies including the US and China if geopolitics allow, but there are many reasons this could fail and the geopolitics are increasingly hostile. A backup plan for regional growth would be wise. |
| Date: | 2025–06–09 |
| URL: | https://d.repec.org/n?u=RePEc:cgd:ppaper:359 |
| By: | Jaedo Choi; George Cui; Younghun Shim; Yongseok Shin |
| Abstract: | US multinationals formed joint ventures in China for market access and lower labor costs. However, these ventures transfer technology to Chinese firms, fueling future competition. While individual firms weigh the risks to their own profits, they disregard the negative impact on other US firms and the broader economy, resulting in an over-investment that may reduce the US welfare. In our empirical analysis, industries with more joint ventures in China show positive spillovers to Chinese firms but negative outcomes for firms in the US. We develop a two-country model with oligopolistic competition, innovation, and joint ventures. For the US, the short-run gains from joint ventures are outweighed by long-run losses due to rising Chinese competition. Joint ventures benefit large US firms at the expense of small firms and the real wages of workers. A ban on joint ventures since 1999 would have boosted US welfare by 1.2 percent. |
| JEL: | F23 O25 O33 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34284 |
| By: | Ai, Jingyi (Fundan University); Chen, Xi (Yale University); Feng, Jin (Fudan University, China); Xie, Yufei (San Diego State University) |
| Abstract: | The study examines the early effects of cognitive-impairment (CI) friendly communities on health care utilization among older adults in Shanghai, China. By exploiting the rollout of CI-friendly communities and employing a difference-in-differences approach, we evaluate the impact of CI-friendly communities. We find that CI-friendly communities significantly increase the probability and frequency of visiting cognition-disease-related departments (CRD) by 0.7 (13.73%) percentage points and 0.02 (17.24%) times, respectively. In particular, the effect is more pronounced for individuals not previously received CRD care. The dominant mechanisms may include information and early screening effects. Additionally, CI-friendly communities affect health care utilization in other positive ways, such as reducing emergency room (ER) visits and promoting primary care use. |
| Keywords: | awareness of cognitive impairment, health care utilization, CI-friendly community |
| JEL: | I18 J14 I11 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18118 |
| By: | Guglielmo Maria Caporale; Gloria Claudio-Quiroga; Luis A. Gil-Alana; Andoni Maiza-Larrarte |
| Abstract: | This paper examines the degree of persistence of China’s travel “credit” and “debt” series in the balance of payments. This is an important issue because the travel component in the balance of payments of travel is one of the main indicators measuring the contribution of tourism to a country’s economic activity, and knowledge of its persistence is critical to assess the potential impact of disrupting factors such as the COVID-19 pandemic. The analysis is carried out using a fractional integration framework, which provides evidence of mean reversion in the credit series, but not in the debt series. The policy implications of these findings are also discussed. |
| Keywords: | China, travel, balance of payments, persistence, fractional integration |
| JEL: | C12 C13 C22 Z30 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12142 |
| By: | Jouvanceau, Valentin; Darracq Pariès, Matthieu; Dieppe, Alistair; Kockerols, Thore |
| Abstract: | This paper examines the macroeconomic impact of substantial tariffs imposed by the second Trump administration on imports from China and the euro area and their transmission through direct and indirect channels. Using the ECB-Global 3.0 semi-structural model, we show that tariffs raise US import prices and lead to tighter US monetary policy, with the managed float of the renminbi partly offsetting adverse effects in China, while appreciation of the dollar undermines US export competitiveness. In the euro area, euro depreciation provides limited output support but intensifies imported inflation and triggers additional policy tightening. We assess the sensitivity of these results to key assumptions, such as the global amplification of inflation via dominant US dollar invoicing, partial trade diversion, and alternative monetary policy frameworks that attenuate monetary tightening and output contraction. Quantitative assessments of tariffs enacted up to 26 May 2025 and of an escalation scenario indicate significant global output losses and heightened inflationary pressures, requiring widespread policy rate increases. Further escalation of the trade conflict magnifies these effects. These findings quantify the economic cost of tariff related trade disputes and highlight the challenges central banks face in navigating the trade off between price stability and growth. JEL Classification: F12, F41, F42 |
| Keywords: | dominant-currency pricing, open-economy, semi-structural model, tariffs |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:ecb:ecbwps:20253117 |
| By: | Gao, Pengjie; Hu, Allen; Kelly, Peter; Peng, Cameron; Zhu, Ning |
| Abstract: | Existing research finds that investors' returns vary with their wealth and level of sophistication. We bring a new perspective from the supply side by showing that return heterogeneity can be magnified as assets offered by the market become more complex. Using detailed account-level data, we examine the trading of B funds-complex, structured products in the Chinese market. During a 3-year market cycle, the return gap between the naive and sophisticated is an order-of-magnitude greater when trading B funds than when trading simple, non-structured funds. In an event study, we confirm that this disparity is driven by differences in investors' understanding of product complexity. |
| Keywords: | complexity; return gap; wealth inequality; AAM requested |
| JEL: | D30 G11 G00 |
| Date: | 2024–03–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:122520 |
| By: | Yufei Sun (Faculty of Economic Sciences, University of Warsaw) |
| Abstract: | This study evaluates the performance of pairs trading strategies in the Chinese stock market across extreme market environments, including the Financial Crisis, Bull and Bear phases, and the COVID-19 period. Using a comprehensive stock dataset and incorporating transaction costs, we find that most portfolios deliver near-zero excess returns after costs. However, in volatile conditions—especially during the Financial Crisis—top-performing portfolios achieved monthly returns up to 156 basis points. The strategy underperforms in stable or bullish markets with fewer mean-reversion opportunities. COVID-19 introduced challenges that further reduced profitability. Results highlight the critical role of transaction costs and the importance of advanced pair selection methods, such as combining the Sum of Squared Deviations (SSD), Hurst exponent, and the Number of Zero Crossings (NZC), which consistently outperform traditional approaches. While generally unprofitable, pairs trading can succeed under specific market regimes, offering insights into risk management and strategy adaptation. |
| Keywords: | Pairs Trading, Statistical Arbitrage, Sum of Squared Deviations, Hurst Exponent, Chinese Stock Market |
| JEL: | C58 C63 G11 G14 G17 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:war:wpaper:2025-23 |