Faking Trade for Capital Control Evasion: Evidence from Dual Exchange Rate Arbitrage in China
Renliang Liu, Liugang Sheng, Jian Wang, Nov 25, 2020
We examine whether firms over-report international trade to evade capital controls for foreign exchange arbitrage, by specifically testing whether the aggregate bilateral trade data gap between trading partners is positively (negatively) correlated with the exchange rate spread when the spread is positive (negative). At the disaggregated level, we also employ Benford’s law to detect trade data manipulations...
Capital Regulations, Bank Risk-Taking, and Monetary Policy in China
Xiaoming Li, Zheng Liu, Yuchao Peng, Zhiwei Xu, Nov 18, 2020
China implemented Basel III in 2013 and tightened bank capital regulations. Empirical evidence shows that the new regulations significantly reduced bank risk-taking following monetary policy easing. To meet the tightened capital requirements, banks respond to a balance-sheet expansion by raising the share of lending to state-owned enterprises (SOEs) that are perceived as low-risk borrowers under government...
VoxChina Covid-19 Forum (Second Edition): China’s Post-Lockdown Economic Recovery
VoxChina, Apr 18, 2020
The lockdowns induced by Covid-19 have led to unprecedented challenges to economies across the globe. The second edition of the VoxChina Covid-19 Forum focuses on China’s post-lockdown economic recovery, with three presentations that are based on data analysis of small businesses, consumption, e-commerce, and beyond, each for 15 minutes. There will be 30 minutes of Q&As.