China & World Economy最新文献

The China Railway Express (CRE) has improved regional economic integration with external markets and has reshaped regional development by encouraging the relocation of manufacturing activities (“manufacturing transfer”). We analyzed data from 284 prefecture-level cities in China to evaluate the impact of the CRE on regional manufacturing relocation, using a staggered difference-in-differences model with entropy balancing. We found that the launch of the CRE significantly stimulated the relocation of manufacturing industries to node cities – key hubs for transportation and logistics within the CRE network – especially in the central, western, and northeastern regions. Specifically, the CRE significantly increased manufacturing dynamism, firm profitability, openness, and foreign investment in node cities, which attracted more manufacturing industries to relocate in this area. Higher levels of infrastructure development moderated the CRE's effect. Further analysis showed that significant moderating effects of infrastructure development occurred only in the western region. Overall, our conclusions provide useful insights into how to promote equitable regional development through manufacturing development in China.

Cross-border e-commerce (CBEC) significantly stimulates foreign trade development and the flow of goods and services. This study, using Chinese city-level data and a multiperiod difference-in-differences model based on CBEC comprehensive pilot zones, explores the impact of CBEC reform on urban service industry entrepreneurship. The results show that CBEC reform increased entrepreneurial activity, and this is confirmed by robustness tests. The mechanisms driving this effect include the attraction of foreign direct investment, improved information infrastructure, and talent development. Regional analysis reveals stronger effects in central, western, and noncoastal cities, and industry analysis highlights public and consumer services. Spatial heterogeneity shows that the reform's impact diminished with distance from pilot zones, with potential inhibitory effects in remote areas. This study demonstrates how CBEC reform can stimulate entrepreneurship and foster economic growth.

This paper illustrates how trade liberalization during an individual's early life can affect long-term health and cognitive outcomes 15 years later (i.e., in adolescence). China's accession to the World Trade Organization has brought significant economic benefits but has also given rise to some environmental concerns. Exploiting variations in each prefecture's exposure to trade shock and trade-induced pollution shock, this study constructed a shift-share instrument variable model. The trade shocks in early life improved health and cognitive outcomes significantly during adolescence while trade-induced pollution shock had the opposite effect, decreasing these two outcomes. These impacts were more pronounced among households with low economic status. Further investigation provided evidence for several underlying mechanisms, such as improved health and education resources and reduced SO₂ emissions by firms. This study provides useful insights into how to evaluate the long-term effects of trade liberalization on human capital in terms of economic benefits and environmental costs in China.

This paper examines the impact on stock return synchronicity of information provided by people who neighbor firms. Neighboring people have inherent advantages in acquiring and interpreting information. We employed novel satellite nighttime light data as a proxy for information held by neighboring people. Our analyses confirmed that brighter nighttime light was related to greater and better-quality information production. Using a sample of 18,963 firm–year observations over the 2000–2013 period, we found that information from nearby people facilitated the incorporation of firm-specific information into stock prices, resulting in lower stock return synchronicity. The results were robust when using the slope as an instrumental variable and were supported by various sensitivity checks. The effect of nighttime light intensity was more pronounced for firms operating across multiple geographic regions or diverse industries, those situated near more parks and shopping malls, and those with fewer institutional investors and less media coverage.

As fundamental economic units, county economies play a crucial role in China's national economic system. However, it remains unclear whether intellectual property rights policies at the county level can promote economic growth. We used a quasi-natural experiment from the Intellectual Property Powering County Project (“the Project”) to measure their impact on county economic growth from 2009 to 2020, applying a multi-period difference-in-differences method. County economic growth indicators were measured using Enhanced Vegetation Index-calibrated nighttime light data from the Defense Meteorological Satellite Program and Visible Infrared Imaging Radiometer Suite. The findings demonstrated that the Project promoted economic growth significantly by incentivizing innovation, attracting high-tech and new-tech enterprises, and fostering brand creation. The Project also exhibited significant heterogeneity across districts and counties, along with spillover effects on economic growth in surrounding counties within approximately 80 kilometers.

We argue that Western media advance two main interpretations of the Belt and Road Initiative (BRI). The first suggests that the BRI is primarily motivated by China's geopolitical ambitions. The second contends that the initiative creates “debt traps” for developing countries, hiding the true size of the debt while aiming at the seizure of the infrastructure it builds. We challenge both claims by reviewing critically the existing literature on the BRI. We posit that rather than geopolitical, China's primary motivation has been to promote the development of its western provinces, transforming landlocked areas into land linked ones. Moreover, most of the existing literature neglects the fact that the need for infrastructure development across various continents is well documented by respective regional banks. The dominant “debt trap” narrative is also refuted by several scholars, together with the hypothesis of “asset seizure” and other related critiques. The article concludes that, if anything, geopolitical motivations (particularly tensions between the US and China) are at the root of the negative narrative surrounding the BRI, rather than at the origin of the BRI itself.

Research is increasingly showing that the impact of education on fertility can result in various and sometimes conflicting outcomes. Using data from the China General Social Survey, this study investigates this issue by exploring five channels (the five “BASIC” effects – base, ambition, spouse, income, and concept effects) through which education might influence different fertility behaviors. Using the number of Confucian temples in a region as an instrumental variable for education and employing the two-stage least squares estimation, the results indicate that after taking into account the BASIC effects, the impact of education on actual fertility behavior – both the number of children and the decision to have children – becomes insignificant. However, the negative influence of education on fertility intentions persists. This suggests that, although an increase in the level of education may reduce people's desire to have children, the actual fertility behavior can be influenced more by factors such as individual work status (the base effect) and personal expectations (the ambition effect). These findings provide new insights to assist China to optimize its population policy further, helping policymakers to understand better how education affects fertility choices and to formulate more precise population development strategies.

Basic innovation, with universities as a key driver, is essential for advancing core technologies in the manufacturing industry. This study used a manufacturing technologies initiative as a natural experiment, combining funding and its outcomes data from the National Natural Science Foundation of China to construct a difference-in-differences model. It found that the Frontiers in Manufacturing Technologies Initiative had a positive effect on university innovation, particularly by increasing the number of university patents. Mechanism analysis showed that the policy mainly encouraged university innovation through university-industry collaboration. The effect was more salient in universities with stronger basic research capabilities and those whose research fields matched strategic emerging industries covered by the initiative. This study underscores the crucial role of the Frontiers in Manufacturing Technologies Initiative in enhancing university-led innovation. It highlights the effectiveness of industry-academia partnerships in advancing technology, particularly in emerging strategic industries.

The disparity in credit access between large firms and small and medium-sized enterprises contributes to the prevalence of shadow banking activities, where large, nonfinancial firms with high credit ratings have become new financial intermediaries. These activities vary geographically and are affected significantly by collateral monetary policy. This paper examines the effect of collateral monetary policy, its reform, and regional financial development characteristics on large firms' shadow banking activities, with a focus on the medium-term lending facility (MLF), the primary collateral monetary policy instrument in China. The results indicate that the MLF encouraged large firms' shadow banking activity. However, the MLF reform in 2018 mitigated this effect by broadening the range of acceptable collateral. Regional financial development, such as a higher number of bank branches around firms, facilitated large firms' shadow banking activities and amplified the MLF's stimulating effect. In contrast, regional advancements in digital finance and market development limited both shadow banking activities and MLF's impact.

This study examines the impact of e-commerce on the survival rate of small and medium enterprises (SMEs) during the COVID-19 pandemic using a combined dataset from the Enterprise Survey for Innovation and Entrepreneurship in China for the period from 2018 to 2020. We conducted a difference-in-differences analysis by exploiting the variation in the adoption of e-commerce across SMEs before and after the outbreak of COVID-19. The results show that e-commerce had a significantly positive effect on the survival rate of SMEs during the crisis. Specifically, it improved the survival rate of SMEs by 3.0 to 3.4 percentage points by expanding the scale of the enterprises' markets, mitigating declines in orders, shortening the repayment periods of accounts receivable, and improving cash flow during a pandemic. Heterogeneity analysis reveals that the impact of e-commerce was more pronounced for SMEs with a larger share of online sales and for labor-intensive SMEs, and third-party e-commerce platforms or Web sites played a bigger role than self-built Web sites and social media. This study offers novel evidence highlighting the value of digitalization for firms during the crisis.