A Bridge on Economic Issues between China and the World
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Trade Liberalization and the Performance of China’s Manufacturing Sector
Loren Brandt, Johannes Van Biesebroeck, Luhang Wang, Yifan Zhang, Dec 27, 2017China’s entry into WTO resulted in a significant reduction in tariffs on imported manufactured goods into China. We examine the effects of market liberalization on firm and industry performance. Tariff cuts on outputs and intermediates had highly complementary effects on productivity, and explain in upwards of forty per cent of the productivity gains between 1998-2007. The effects on mark-ups were largely offsetting, however lower tariffs on inputs helped to provide additional resources for productivity-enhancing investments.
Industry/Policy View How Does Monetary Policy Affect the Asset Management Industry? Evidence from China’s Fund Managers
John Ammer, John Rogers, Gang Wang, Yang Yu, Jul 15, 2020We conduct a novel systematic textual analysis of the discussion in the quarterly reports of China fund managers, from which we infer their near-term expectations for Chinese monetary policy. We show that this aggregate index of manager expectations performs well as a forecast of Chinese monetary policy, that fund managers act on these expectations, and that correctly anticipating shifts in policy improves fund...
Capital Regulations, Bank Risk-Taking, and Monetary Policy in China
Xiaoming Li, Zheng Liu, Yuchao Peng, Zhiwei Xu, Nov 18, 2020China 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...
China’s Overwhelming Contribution to Scientific Publications
Qingnan Xie, Richard B. Freeman, Sep 19, 2018That China, one of the lowest income countries in the world at the turn of the 21st century, became a super-power in scientific knowledge in less than two decades is a remarkable development in the history of science. The way China deploys its newly developed scientific resources will drive the direction of science and technology into the foreseeable future and the direction of our increasingly knowledge-based economy.
Credit Expansion and Allocation Dynamics under Economic Stimulus
Lin William Cong, Jacopo Ponticelli, Sep 13, 2017We study credit allocation across firms and its real effects during China’s economic stimulus plan of 2009-2010 using loan-level data from the 19 largest Chinese banks matched with firm-level data on manufacturing firms. We find that the stimulus-driven credit expansion significantly affected firm borrowing, investment, and employment. The plan disproportionately favored state-owned firms and firms with a lower marginal product of capital, reversing the process of capital reallocation that characterized China’s high growth before 2008.
