A Bridge on Economic Issues between China and the World
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Rising Intergenerational Income Persistence in China
Yi Fan, Junjian Yi, Junsen Zhang, Jul 04, 2018Although studies on economic inequality and intergenerational mobility have gained traction in the last decade, little is known about the temporal changes in the intergenerational association of economic status, especially in developing and transitional economies. We find an increasing pattern in intergenerational income persistence across China’s transitional period. To promote intergenerational mobility, the Chinese government should continue to remove rural-urban migration barriers and initiate various programs to subsidize the education of children from disadvantaged families, known as the “left-behind” children.
Evidence of Precautionary Savings in China
Hui He, Feng Huang, Zheng Liu, Dongming Zhu, Sep 05, 2018China’s household savings rate has been persistently high since the early 1980s despite rapid economic growth and contrary to the predictions of the standard consumption theory. Since China has undergone large structural changes in its transition to a market economy, precautionary savings seem to be a plausible contributing factor to the high savings rate. We use China’s large-scale reform of State-owned Enterprises (SOEs) in the late 1990s as a natural experiment to identify exogenous changes in income uncertainty. We estimate that precautionary savings account for about 40 percent of SOE households’ wealth accumulation from 1995 to 2002.
Industry/Policy View The US-China Trade War Is Based on Misleading Statistics
Zhiwei Zhang, Yi Xiong, Xinyu Ji, Jul 11, 2018General Motors and Apple sold more cars and iPhones in China than in the US, but their sales were not counted as US exports to China, as these were made and sold in China. Policymakers should look at both trade and local sales by foreign firms (the FDI channel) to gauge bilateral economic balance. We estimate that US firms sold more goods and services to China than Chinese firms sold to the US in 2017, once the FDI channel is taken into account.
Gaokao, Ability, and Occupation Choice
Chong-En Bai, Ruixue Jia, Hongbin Li, Xin Wang, Jul 28, 2021In China, the college entrance exam score is predictive for both firm success and wage-job success in the future, yet higher-score individuals are less likely to create firms.
Black Markets for License Plates in Chinese Megacities
Oystein Daljord, Mandy Hu, Guillaume Pouliot, Junji Xiao, Jan 29, 2020Chinese megacities ration new car sales by capping the number of license plates they issue that permit driving within city limits. Concerns regarding the fairness of this policy have led city governments to use lotteries to allocate either all or a share of the license plates. Lotteries create gains from trade that have stimulated black markets for license plates in such cities...
