Official unemployment rate in China is based on registered unemployment figures, but the official figures are likely underestimates of the true unemployment rates because many unemployed people are not qualified to register with government agencies and even those who are qualified may choose not to for various reasons. Shuaizhang Feng of Jinan University, and Yingyao Hu and Robert Moffitt, both of Johns Hopkins University, discuss their new effort to provide the first comprehensive picture of China’s labor market for the period 1988-2009 using Urban Household Survey (UHS) data administered by the National Bureau of Statistics of China.
China’s stock market imposes various trading restrictions such as daily price limits and trading suspension rules, which are intended to stabilize the market during turmoil. During China’s stock market crash in the summer of 2015, these trading restrictions made many highly valued stocks non-tradable and consequently caused mutual funds facing redemption pressure or with precautious concerns to sell other tradable stocks, exacerbating their price drops.
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.
Household education expenditure in China accounts for a substantial portion of household income, averaging around 17.1%, and it is inversely related to household income. As a necessity, education expenditure imposes excessively high costs on lower-income families. China needs to formulate policies to alleviate the financial burden on families, reform the school system, and enhance educational equity.
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.