A Bridge on Economic Issues between China and the World
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Evaluating the Burden of a U.S.-China Trade War
Meixin Guo, Lin Lu, Liugang Sheng, Miaojie Yu, Apr 25, 2018Trade disputes between the United States and China greatly intensified recently as the two countries announced a 25 percent tariff hike on $50 billion worth of products imported from each other, raising the risk of a trade war between the two giant trading economies. Based on a standard multi-sector, multi-country general equilibrium trade model with input-output linkages, we evaluate the cost of a trade war in which the United States and China both increase their tariffs to 45% for all imports from each other. We find that the United States would be more likely to be the bigger loser and that the cost for China would be moderate.
E-Commerce Development and Household Consumption Growth in China
Xubei Luo, Yue Wang, Xiaobo Zhang, Sep 04, 2019China has quickly become the largest e-commerce market in the world. E-commerce has reshaped consumption patterns in recent years. This paper examines how e-commerce development has shaped household consumption growth in China. It finds that e-commerce development is associated with higher consumption growth, that the link is stronger for the rural sample, inland regions, and poor households...
Book Synopsis New Cycle or Old (Guaranteed) Bubble?
Ning Zhu, Oct 04, 2017It seems necessary that one gains some deeper understanding of the sources of China’s phenomenal economic growth. Apart from all well-founded extant explanations, my recent book Guaranteed Bubble argues for another important yet previously overlooked source: the guarantees provided by the Chinese government.
US–China Tensions
John Rogers, Bo Sun, Chris Webster, Apr 28, 2021We construct a US–China Tensions index (UCT) and examine its economic transmission effects. The index spikes notably around the 2008 unrest in Tibet and the China military buildup, the 2018 arrest of a Huawei executive, and the 2018–2019 trade disputes. The index reaches its peak at the onset of the 2020 global pandemic. We interpret such tension as reflecting both the realization of new barriers between the two countries and the risk of existing barriers escalating. We show that heightened US–China Tension has adverse economic effects...
Selective Default by Local Governments in China
Haoyu Gao, Hong Ru, Dragon Yongjun Tang, Jan 10, 2018We identify bank loans to China’s local government financing vehicles and find that 1.7% of the loans that matured during the sample period failed to make the due payments. The LGFV loan default rate is much higher for commercial banks than for the China Development Bank, which provides more comprehensive financing for local governments than typical commercial banks. This selective default pattern is weaker during the ¥4-trillion stimulus period but stronger after 2010 when commercial banks exited the LGFV market.
