As the second largest economy, China intrigues heated debates among policymakers and researchers alike on how fast its economy will grow in the future and how truthfully the official data reflect its actual economic growth. Patrick Higgins and Tao Zha from the Atlanta Fed and Karen Zhong from Shanghai Advanced Institute of Finance develop a replicable econometric model to shed light on these issues.
The shadow banking activities in China surged in 2012-2013. Prof. Zhuo Chen and Prof. Chun Liu from Tsinghua University, Prof. Zhiguo He from Chicago Booth and Prof. Jinyu Liu from the University of International Business and Economics provide empirical evidence showing that the “barbarian growth” of China’s shadow banking during this period constitute a “hangover effect” from the four trillion RMB stimulus package in 2009.
The role of banks in the Chinese bond market, the third largest in the world, is greatly underestimated when proxied only through the share of issuance. For the future growth and deepening of the Chinese bond market it will be important to lower reliance on banks in order for the bond market to play its intended role as a spare tire of the financial system.
I study the causal effects of South Korea’s baby bonus on fertility by exploiting temporal and spatial variation in pro-natalist cash transfers provided to families with newborn babies. Based on registry records spanning the universe of births from 2000 to 2015, I find that the baby bonus increased completed fertility: in the absence of the policy, the total fertility rate in 2015 would have been lower by 3%, which is equivalent to 450,000 fewer babies born...
By exploiting the exogenous variation in air pollution caused by China’s central heating policy, we find that air pollution reduces the accumulation of executive talent and high-quality employees. We also find that firms located in polluted areas have poorer performance, especially for firms with greater dependence on human capital.