China Economic Quarterly International最新文献

Using panel data from National Rural Fixed Point Survey and a supplementary survey about rural ICT projects, this paper empirically analyzes the impact of ICTs on rural households’ income and income disparity in China. The results show that ICTs promotes the growth of total income and wage income of rural households, and has an inhibitory effect on agricultural income, but this inhibitory effect gradually disappears in the process of rural ICT development. The positive effect of ICTs on rural households’ total income is enduring. The heterogeneous analysis further indicates that the income-increasing effect of ICTs is more pronounced for higher-income and higher-educated farmers, which exacerbates the income disparity in rural areas.

The housing provident fund is an important part of payroll taxes. This paper quantifies its impact on employment. Although the fund helps enterprises with R&D to recruit more employees, it will also reduce the profitability of enterprises and cause enterprises to shrink their production scale, resulting in a negative overall effect on the number of employees. The negative impacts are significant in groups with strong financing constraints, and it mainly affects workers with a low education level and male workers. This paper also examines the impact of the increase and decrease of the contribution rate. The results show that reducing the contribution rate will promote employment.

We use the prefecture-level panel data and enterprise-level data of China's manufacturing enterprises from 2001 to 2009 to investigate the effects of economic development and minimum wage policy on foreign-invested enterprises' exit behavior. The increase of local minimum wage from the 25th percentile to the 75th percentile accounts for 20% of the average exit rate of foreign-invested manufacturing enterprises, while the local economic development does not affect the exit of foreign-invested manufacturing enterprises. Compared with “market-oriented” foreign-invested enterprises, “cost-saving-oriented” foreign-invested enterprises are more likely to exit from the market owing to the rise of minimum wage. Enterprises in industries with high labor intensity, large scales, low average wages, relatively high proportions of low-skilled labor, fierce competition, and poor industrial supporting facilities are more likely to be negatively affected by the rise of minimum wages.

This paper investigates how the government stabilizes economic growth from the perspective of government expenditure. We contribute a method to identify the government expenditure aimed at stabilizing growth and empirically examine it using a dataset of economic growth targets. We find that when the economy encounters adverse shocks, government expenditure increases significantly by 1.1 percentage points on average for every one percentage point increase in the growth target. We document the following patterns of stabilizing growth: (1) government increases expenditure on economic affairs rather than on other functions; (2) government expenditure is financed by current revenue; and (3) it is a temporary behavior to stabilize growth. This paper also suggests that stabilizing growth by increasing government expenditure is a global phenomenon.

Recent years have witnessed the rising support for right-wing populism in European politics. We rely on the outcomes of the 2014 European Parliament elections to empirically examine the economic and cultural mechanisms that fuel this trend. Using import competition to measure economic shocks and regional-level refugee shocks, we find that regions exposed to more intense trade shocks are more likely to vote for right-wing parties. We further show the increasing support for economically far-right parties is mainly caused by trade shocks, and the electoral support for culturally far-right parties stems mainly from refugee shocks.

We build a dynamic stochastic general equilibrium (DSGE) model with financial repression and conduct estimation and simulation with it using aggregate data. We discuss the interaction and optimal combination of fiscal and monetary policies when the model features SOE monopoly and financial repression. We find that under current situation, fiscal policy should play a bigger role in stabilizing output, while monetary policy ought to pay more attention to combatting inflation. Although private firms' limited access to credit can be attributed to financial repression and SOE monopoly, financial repression is a second-best policy, in that it promotes SOE's output via cheap credit when SOEs behave like monopolists. This offsets the efficiency loss associated with monopoly. Moreover, our policy experiments show that the optimal fiscal policy can respond less to output fluctuations, when SOE reforms dampen the significance of financial repression.

R&D manipulation prevails in firms' application for high-tech enterprise certification. This paper provides evidence on how media coverage significantly inhibits firms' R&D manipulation behaviour by increasing citizens' concerns. Among all the media reports, original reports and in-depth reports serve the strongest purpose in alleviating R&D manipulation. Among all types of media, online media and authoritative media play a stronger role. We also find a more pronounced supervision role of media for enterprises that are owned by private entities, covered by more analysts, administrated by more capable governments or located in regions with a higher marketization level. We also provide evidence on the enhancement of firms’ R&D performance due to media coverage.

Based on Chinese industrial firms’ data, this study found that state capital injection weakened the technological progress and management efficiency of private firms, which led to a reduction in enterprises’ total factor productivity. State capital injection also increased the labor cost and investment in fixed assets, and lowered the profitability of firms. Furthermore, the state capital did not have a significant negative impact on firms in technology-intensive and monopoly industries. This study has shed some lights on the reform of the state-owned assets management system and the development of a mixed ownership economy.

Using data from AidData and the conflict report from Uppsala Conflict Data Program (UCDP) from 2000 to 2014, we find that China's other official flows (OOF) aid can significantly reduce the frequency of conflicts. To deal with the endogeneity, we use China's competitive capacity as the instrumental variable. Our results are robust when considering the possible sample selection bias and different types of international aid. We find that increasing the local infrastructure investment and employment is the main mechanism, which increases the opportunity cost of engaging in conflicts. Our results provide evidence on the effectiveness of China's aid mode and the importance of infrastructure investment in developing countries.

The national trunk highway system (NTHS), consisting of five vertical and seven horizontal national trunk highways, is taken as a natural experiment to study the impact of transportation infrastructure on firm productivity. It is found that the NTHS has led to the agglomeration of production resources of county-level enterprises along the system to large cities, and the degree of agglomeration has industry-level heterogeneity. Although the NTHS has promoted the division of labor among county-level enterprises, it is difficult for these enterprises to compete with those in big cities and share efficiency and economic benefits from the deepening of the division of labor.