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Improving State Effectiveness by Discouraging Civil Servants from Flattering Their Leaders

Alain de Janvry, Guojun He, Elisabeth Sadoulet, Shaoda Wang, Qiong Zhang, Mar 11, 2020

Evaluation of public employees performance is essential to induce higher work efforts. We use an experiment in two provinces of china to explore how to design such evaluation. Results show that the incentive effect of evaluation can be larger if the employee does not know ex-ante who the evaluator will be, thus reducing attempts at personally influencing the evaluator and enhancing instead job achievements.

Estimating China’s Growth Potential from Its Global Value Chain Position

Dazhong Cheng, Jian Wang, Zhiguo Xiao, Mar 04, 2020

We find that China’s potential growth in GDP per capita is substantially underestimated if the level of GDP per capita is employed as the convergence indicator as done in previous studies (e.g., Barro, 2015 and 2016). Using data on China’s position in the global value chain (GVC) prior to 2010, we predict that the country’s GDP per capita could have grown at 7%–8% annually between 2010 and 2015, which is closer...

Implicit Guarantees and the Rise of Shadow Banking: the Case of Trust Products

Franklin Allen, Xian Gu, C. Wei Li, Jun Qian, Yiming Qian, Sep 06, 2023

The prevalent implicit guarantees provided by financial intermediaries have been a central feature of shadow banking products in China. Our theoretical investigation shows that providing implicit guarantees can be the second-best arrangement and mitigate capital misallocation.

The Effect of Pollution and Heat on the Productivity of High-Skill Public Sector Workers in China

Matthew E. Kahn, Pei Li, May 22, 2019

The quality of governance depends on public sector worker productivity. We use micro data from China to document that judges are less productive on polluted days. We find that public sector productivity elasticities are larger than the published estimates of private sector productivity elasticities with respect to pollution.

Human Mobility Restrictions and the Spread of the Novel Coronavirus (2019-nCoV) in China

Hanming Fang, Long Wang, Yang Yang, Jun 03, 2020

We provide a rigorous examination of the causal impact of human mobility restrictions, particularly the lockdown of the city of Wuhan on January 23, 2020, on the containment and delay of the spread of the Novel Coronavirus (2019-nCoV) in China. We employ various difference-in-differences strategies to disentangle the lockdown effect on human mobility reductions from other confounding effects, including a panic effect, a virus deterrence effect, and a Spring Festival effect...