A Bridge on Economic Issues between China and the World
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How the Internet Changed Chinese Exports before Ali Baba Came
Ana M. Fernandes, Aaditya Mattoo, Huy Nguyen, Marc Schiffbauer, May 16, 2018The roll-out of the internet in China boosted firms’ exports and overall performance even before the rise of broadband and major e-commerce platforms. This finding is relevant for the many developing countries trying to strike a balance between widening access to basic internet services and deepening it through the creation of broadband networks and connections to major e-commerce platforms.
China’s Rebalancing: Recent Progress, Prospects, and Policies
Rui C. Mano, Jiayi Zhang, Mar 20, 2019While China’s growth gathered momentum in 2017, rebalancing was uneven and decelerated along many dimensions reflecting the temporary factors behind the growth pickup. Going forward, rebalancing is expected to proceed as these temporary factors recede, but elevated income inequality and leverage will remain a challenge. The authorities are...
Tariff Passthrough at the Border and at the Store: Evidence from US Trade Policy
Alberto Cavallo, Gita Gopinath, Brent Neiman, Jenny Tang, Sep 02, 2020We study the impact of recent tariffs on US prices at the border and at the store. Our results imply that, so far, the tariffs’ incidence has fallen in large part on US firms.
Trends and Cycles in China’s Macroeconomy
Chun Chang, Kaiji Chen, Daniel F. Waggoner, Tao Zha, Jun 27, 2018China’s spectacular growth over the 2000s has slowed since 2013. The driving force behind the country’s growth was investment, so the key to understanding the slowdown lies in understanding what sustained investment in the past. This column shows how a preferential credit policy promoting heavy industrialisation explains the trends and cycles in China’s macroeconomy over the past two decades. This policy was not without negative consequences, particularly in terms of the distortions it introduced for business finance. Going forward, China needs to focus on creating the right incentives for banks to make loans to small productive businesses.
The Dynamic Effects of Computerized VAT Invoices on Chinese Manufacturing Firms
Haichao Fan, Yu Liu, Nancy Qian, Jaya Wen, Aug 08, 2018This investigation uses a balanced panel of large manufacturing firms to provide novel evidence on the dynamic effects of computerizing VAT invoices on tax revenues and firm behavior in China, 1998-2007. We find that computerization increases cumulative VAT revenues and increases the effective average tax rate. Furthermore, the evidence suggests that the effects of computerization change over time: tax revenue gains are likely to be smaller in the long run. Meanwhile, firms reduce output and input, and increase productivity monotonically over time.
