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The relationship between financial development and economic growth has become a hot topic in recent years and for China, which is undergoing financial liberalisation and policy reform, the efficiency of the use of digital finance and the deepening of the balance between quality and quantity in financial development are particularly important for economic growth. This paper investigates the utility of digital finance and financial development on total factor productivity in China using interprovincial panel data decomposing financial development into financial scale and financial efficiency; an interprovincial panel data model is used to explore the utility of digital finance on total factor productivity. This involves the collection and preprocessing of financial data, including feature engineering, and the development of an optimised predictive model. We preprocess the original dataset to remove anomalous information and improve data quality. This work uses feature engineering to select relevant features for fitting and training the model. In this process, the random forest algorithm is used to effectively avoid overfitting problems and to facilitate the dimensionality reduction of the relevant features. In determining the model to be used, the random forest regression model was chosen for training. The empirical results show that digital finance has contributed to productivity growth but is not efficiently utilised; China should give high priority to improving financial efficiency while promoting financial expansion; rapid expansion of finance without a focus on financial efficiency will not be conducive to productivity growth. [ABSTRACT FROM AUTHOR]

Following market liberalization, the vehicle population in China has increased dramatically over the past few decades. This paper examines the causal impact of the opening of a heavily used high speed rail line connecting two megacities in China in 2015, Chengdu and Chongqing, on air pollution. We use high-frequency and high spatial resolution data to track pollution along major highways linking the two cities. Our approach involves the use of a novel augmented regression discontinuity in time approach that incorporates machine learning to inform our specification choice in the first stage. Our estimates show that CO is reduced by 6.4% and PM 2.5 by 7.1% along the main affected highway. These findings are supported using a difference-in-differences approach. [ABSTRACT FROM AUTHOR]

Based on the implementation of Shanghai-Hong Kong Stock Connect in China, this paper examines the effects of financial liberalization on stock market comovement using both multifractal detrended fluctuation analysis (MF-DFA) and multifractal detrended cross-correlation analysis (MF-DCCA) methods. Results based on MF-DFA confirm the multifractality of Shanghai and Hong Kong stock markets, and the market efficiency of Shanghai stock market increased after the implementation of this connect program. Besides, analysis based on MF-DCCA has verified the existence of persistent cross-correlation between Shanghai and Hong Kong stock markets, and the cross-correlation gets stronger after the launch of this liberalization program. Finally, we find that fat-tail distribution is the main source of multifractality in the cross-correlations before the stock connect program, while long-range correlation contributes to the multifractality after this program. [ABSTRACT FROM AUTHOR]

This paper sheds light on the international spillovers of China's reforms in upgrading industrial capabilities, liberalizing capital account, internationalizing the renminbi, and transition to flexible exchange rates. Drawing on two-country New Keynesian model of endogenous entry and portfolio adjustment, we find that China's industrial upgrading that peddles on yuan appreciation lifts all boats through global production network irrespective of capital account convertibility, degree of renminbi internationalization, and exchange rate reform. Feasibility of appreciation-driven upgrading is called into question, however, when renminbi reform and capital account liberalization go in parallel. We also show that international spillovers disappear once renminbi internationalization is associated with liberalized capital account and flexible renminbi exchange rates. [ABSTRACT FROM PUBLISHER]

Along with the emergence of the 'three rural issues' and rural crisis, a new co-operative movement has been witnessed in rural China, which is different from the former revolutionary communalist co-operative movement. This social movement can help to understand and rebuild civil society in China, which has, more often than not, been criticized as not genuine, civil nor society-based. Following the debate's background of the juxtaposition of a fast economic reform together with slow social and political reforms in China, the paper addresses a crucial question on the impact of economic development on civil society dynamics in China. By identifying the causal mechanisms of the new co-operative development and the conditions needed for them to develop, the paper presents some implications of the co-operative model in today's society. These causal mechanisms are set within the context of one historical process evolving with a path dependency. Using this theoretical framework, it further presents the empirical observations. Through the findings it is concluded that the new co-operative movement in rural China can be considered as a mild liberalization within civil society's sphere. While questioning a popularly used perspective examining the voluntary/non-profit nature of civil society organizations and excluding the economic aspect within civil society studies in China, the paper suggests an alternative approach representing an inclusive third sector with diverse organizations that combine both economic and social aims. [ABSTRACT FROM AUTHOR]

East Asia is steadfastly marching towards regional economic integration through a number of regional trade agreements (RTAs) and China is a major driving force behind this movement. This paper analyses China's RTAs and their impact on regionalism in Asia. It addresses the criticisms that China's RTAs are politically but not economically driven, that China's RTAs create the hub-and-spoke bilateralism and that China's RTAs are not World Trade Organization consistent. It discusses China's position on East Asian regionalism, pointing out that China wishes East Asia to pursue regionalism on multi-track and at multi-speed, that China tends to 'do easy things first' with low integration and liberalisation and then gradually move to deeper liberalisation and integration and that China's definition of 'open regionalism' does not include outside countries such as the USA and the EU. The paper makes suggestions for improving China's RTAs in the interest of establishing an East Asia free trade agreement. [ABSTRACT FROM AUTHOR]

2010 brings news regarding China's economic strategy. It has strengthened its trade relations with emerging economies, making significant investments, plus significant imports and exports, proving again that it is the first commercial power in the world. China, considered being "the manufacturer of the world", along with Brazil and Russia, major exporters of raw materials, and India, the country which offers the cheapest technology services, has made the world organization, named as BRIC. In 2009, China has consolidated its position as the main trading partner with Brazil, a position that enabled it in 2010 to become the largest investor in the Brazilian territory. In the last years, China has made a lot of investments not only in Asian territory, but also in Europe. China has focused its investments in strategic regions, developing its trade relations. One of the most important Chinese strategies is the monetary one, through which China is trying to grow internationally Yuan's importance, reducing the dependence on the dollar by driving autonomous trade flows. It is expected that Yuan will become the main currency in Asia, main goal that will be achieved by the constitution of large reserves of Yuan on the Asian territory. Knowledge of Chinese economic policy and relations with emerging economies is essential, since 2010 shows the economic power of this nation, the largest trading power in the world, which has led the economists to study China's economic situation. We used for this study, data extracted from UNCTAD and ASEAN's reports from 2010, plus various U.S. studies on China's geostrategic position. We tried to analyze Chinese FDI flows and stock in correlation with its economic growth rate, analysis based on an econometric model. This study is based on UNCTAD ASEAN's reports and on an econometrical model which gives us the possibility to create different analysis concerning FDI flow in this country. So we defined a simple regression model, in which the dependent variable is represented by Nominal and real GDP, total and per capita, variable explicated by FDI flows, using as method the Least Squared, including 29 observations. Through this paper, we tried to illustrate the relation between the FDI flows and the economic growth rate in the past years in China, member of BRIC cooperation. China's geostrategic position is an important one, especially compared with the other BRIC countries, making energy investments in the Middle East, strategy that was adopted also by India and Russia; so Russia and China created ESPO project, Eastern Siberia - Pacific - Ocean, through which China is making huge investments in energy and Russia is trying to stand out for European markets. Through this paper, we tried to evidence China's financial and trade relations with USA, European Union and emerging economies, in the context of a severe economical crisis, named by Nouriel Roubini in his book, White Swan. [ABSTRACT FROM AUTHOR]

Abstract: Political rivals for six decades, Taiwan and China, began regular non-stop passenger flights on July 4, 2008. This paper aims to clarify the implications of the Cross-Strait Air Transport Agreement reached by both countries. It offers a review of air transport development in Taiwan and China and compares their approaches with other countries. In particular, this paper discusses Taiwanese and Chinese perspectives on the opening of direct flights. It goes onto analyse the probable effects of the direct flights and identifies the likely winners and losers. It concludes that strengthening air links between the two countries did reduce travel time considerably for passengers and the resulting growth in business will help cushion the effects of the industry’s current economic downturn. [Copyright &y& Elsevier]

This paper examines China's considerations in reaching the 2004 and 2007 Air Service Agreement Protocols with the United States (US) and the impacts of such policy on the China–US market from the perspective of China. Analysis shows that the 2004 and 2007 protocols have profound impacts on the China–US market. The two protocols have been associated with phenomenal traffic growth and intensified competition. Passengers also benefit from much more choice in terms of both airlines and routing. Over time, Chinese carriers' operating performance and financial performance have gradually improved after the liberalization expressed in the protocols. However, the industry's hub-building initiatives are still seriously challenged by competing hubs in Seoul and Tokyo which have diverted substantial number of passengers moving between the China and US markets. Such issues have to be addressed in order to create a win–win outcome for both countries. [ABSTRACT FROM AUTHOR]

Economic cooperation between Hong Kong and Mainland China, especially Guangdong province, has flourished since the establishment of the Hong Kong Special Administrative Region in 1997. The landmark is the conclusion of the Closer Economic Partnership Arrangement (CEPA) between Hong Kong and the Mainland in 2003. CEPA covers liberalisation of trade in goods, liberalisation of trade in services, mutual recognition of professional qualifications, and other trade facilitation measures. This paper uses the collaborative governance regime framework to analyse the economic cooperation between Hong Kong and Mainland China under CEPA. This case shows that if there are environmental conditions generating incentives for both parties to cooperate, a committed leadership on both sides to drive the regime, and institutional arrangements that could facilitate the collaborative dynamics, effective collaboration between players from different political and institutional backgrounds can still be achieved. [ABSTRACT FROM PUBLISHER]

In large and heterogenous countries, cross-regional inequality often fuels political conflict over redistributive demands. Standard economic theory holds that initial inequality in incomes across subnational regions of a country should eventually give way to convergence. However, economic liberalization in Russia and China has not produced crossregional convergence. The paper demonstrates that interregional inequality remains high in both countries and grounds explanation for this finding in their communist institutional legacies. Their common institutional history complements country-specific explanations for the observed trends in cross-regional inequality. [ABSTRACT FROM AUTHOR]

Summary Public–private partnership (PPP) has gained popularity during the market-oriented reforms in China’s urban infrastructure sectors. This paper explores how city characteristics, spatial pressures, and other institutional forces condition the extent of liberalization reforms in local infrastructure markets. The findings advance the policy diffusion literature by suggesting that the different diffusion mechanisms not only function independently, but also moderate each other’s effects under certain conditions. Specifically, this research finds that the effects of peer pressure undermine the effects of spatial exposure, and the influence of provincial government reduces the effectiveness of peer pressure and epistemic influences. [ABSTRACT FROM AUTHOR]

Summary This paper examines how industrial policy – specifically tariff liberalization and tax subsidies – affects the magnitude and direction of FDI spillovers. We examine these spillover effects across the diverse ownership structure of China’s manufacturing sector for 1998 through 2007. We find that tariff reforms, particularly tariff reductions associated with China’s WTO ascension, increased the productivity impacts of FDI’s backward spillovers. Tax policy – both corporate income and VAT subsidies – has seemingly drawn FDI into strategic industries that spawn significant vertical spillovers. We conclude that liberalization measures during the critical 1998–2007 period on balance served to enhance productivity growth in Chinese industry. [ABSTRACT FROM AUTHOR]

This paper analyzes the impact of relaxing fertility controls and expanding social security in China. We develop an overlapping generations model in which fertility decisions and capital accumulation are endogenously determined in the presence of social security. In our model, children are an alternative savings technology-as they transfer resources to their retired parents. Important feedback links arise between fertility and social security variables: an expansion of social security benefits reduces fertility-partially offsetting the effects of relaxing the one-child policy. The feedback loop between social security variables and fertility suggests that abandoning fertility restrictions may not be as effective in helping to finance China's intended pension reform, especially if children are an important source of old-age support. The sustainability of the pension system is particularly at risk in the event of a growth slowdown. The objective of pension reforms may also be incongruent with other reforms, such as financial liberalization and financial integration. [ABSTRACT FROM AUTHOR]

This paper is concerned essentially with the question of how does financial globalization affect economic welfare? Orthodox theory suggests that because of the greater risk-sharing between countries that financial liberalization entails, there should be no welfare losses. Greater risk-sharing should lead to greater smoothing of consumption and/or growth trajectories for developing countries. Yet there is widespread evidence of crises following liberalization. Apart from these international macro-economic issues, it is argued here that financial globalization changes the very nature of capitalism from managerial to finance capitalism. This profoundly affects at the micro-economic level corporate governance, corporate finance and income distribution. Both macro-economic and micro-economic factors outlined here influence human development. [ABSTRACT FROM AUTHOR]

This paper uses a global computable general equilibrium model, global trade analysis project and a value-to-volume conversion to arrive at quantitative estimates of the new seaborne cargo volumes resulting from a free trade agreement between Taiwan and China, namely, the Economic Cooperation Framework Agreement (ECFA). The approach is designed to model asymmetric impacts of tariff removal and economy-wide interactions caused by the ECFA arriving at estimation in cargo value flows. Then a scientific approach is developed to convert the estimated cargo value flows into volume flows. The analysis concludes that in terms of total trade value, the ECFA liberalisation would induce a trade creation effect across the Strait of more than US$ 30 billions. There is an increase of US$ 26.04 billions in exports to China, which is much higher than imports from China (US$ 4.67 billions). Regarding the converted trade volume, the exports of uncontainerisable and containerisable cargo to China increase by 0.37 and 5.12 million tons (0.43 million TEUs), respectively. The increases in imports from China are relatively minor at 0.19 and 0.75 million tons (0.06 million TEUs) of uncontainerisable and containerisable cargo. Policy implications and suggestions for shipping and port industry are provided accordingly. [ABSTRACT FROM AUTHOR]

In this paper, we address two major questions. First, the question of whether China and India are displacing the African manufacturing export from the third market. Second, whether there is an evidence of shifting comparative advantage from China and India to Africa. We employed a gravity model with a panel data using 13 African exporters of clothing and accessories for the period 1995–2005 to answer the first question. To answer the second question, we used a flying-geese model and estimated Spearman's rank correlation coefficients on indices of the revealed comparative advantage vectors of the African exporters and China and India for the same period. Both the gravity and flying-geese models predicted similar outcomes. We found that there is strong evidence that China has been displacing African manufactures from the third market while India has been complementing it in the early years of the study. However, the overall third market impact of China and India has been that of complementarity in the later years of the study period. This result is found to vary across countries. Furthermore, we found evidence of shifting comparative advantage from China and India to Africa as the flying-geese theory predicts, South Africa being the leading goose followed by Kenya. The major implication of the study is that, in the world where China and India are reshaping the global economic order dynamically, the outcomes of the traditionally received wisdom of trade liberalization and industrialization policies through export promotion may be uncertain and requires strategic thinking. [ABSTRACT FROM AUTHOR]

Why did a gradualist transition approach achieve different performances among socialist economies in the 1980s? Why did some socialist economies never try a gradualist approach to economic liberalization? This paper develops a model to show that the liberalization of a socialist economy has two opposite effects on the rent captured by government. The initial economic condition determines the relative strength of the two effects, and consequently the transition path and performance. In addition, a gradualist reform strategy adopted by a rent-seeking government cannot finish the transition toward a complete market economy. To achieve that goal, a new constitutional order and the rule of law are necessary. [ABSTRACT FROM AUTHOR]

Concerns over the effects of globalisation and liberalisation have intensified the debates over the trajectories and underlying sources of regional inequality. This paper attempts to link macro studies of regional inequality to micro studies of local development and to expand the research on intraprovincial inequality in China to Guangdong Province. First, substantial evidence has been provided to illustrate the extent of polarisation between the Pearl River Delta (PRD) and the periphery, especially since the early 1990s. Second, it has been found that new economic spaces centred on exoproduction centres, high-tech zones, university clusters, and entrepreneurial spaces driven by the domestication of globalisation and the growth of the knowledge economy have emerged as new engines of regional growth. The orthodox notion of the PRD development as externally driven has become obsolete, and a new conceptualisation centred on the knowledge economy and integrated development better explains regional development and polarisation in Guangdong. Finally, the theoretical and policy implications of the research are discussed. The emerging form of regional development in the PRD represents an effort to make the knowledge economy the new engine of regional development and indicates that developing countries such as China are attempting to move beyond being a manufacturing assembler. The emergence of the knowledge economy in the PRD also has important implications for the recent efforts to develop the Greater Pearl River Delta, which needs to pay more attention to global networks for innovation and creativity. Moreover, the emergence of the knowledge economy makes the development of the periphery even more challenging due to the effects of self-reinforcing agglomeration and the constraints of geographical barriers. [ABSTRACT FROM AUTHOR]

This paper argues that China's response to economic liberalisation, which artificially focuses on promoting particular sizes of firms, cannot improve technological capabilities in the ICT manufacturing industry. Not only have historical and economic conditions created difficulties in adopting Korean and Taiwanese style policies, but also competitive ICT firms in the global economy are increasingly moving from manufacturing to innovation activities against a backdrop of increasing economic liberalisation. Given the WTO and ITA agreements, the main path which Korea and Taiwan employed is now unavailable. The government therefore should leave the size of firms to market forces. [ABSTRACT FROM AUTHOR]

In this article, the international flows of capital are analyzed, mainly the directed ones towards tile underdeveloped countries during the Nineties. We emphasized the particular case of the direct foreign investment (FDI). We raised that, although, at the beginning of that decade the FDI entered those countries massively, at the moment, ill the early years of the new century, the main reasons that attracted it tend to finished for some countries, whereas in other they begin to act. In general, we concluded that several uncertainties in relation to the tendencies of the FDI in the next years exist, also we questioned the theoretically counteract paper of the foreign bank on the financial fragility of the developing countries. In this context, we analyzed the case of China, like an exception to the general tendency, from its economic opening of 1978, but, concluded that, with its enter to the World Trade Organization (WTO), its financial and banking system in particular, could emulate the general tendency and to undergo the pernicious effects of the loss off financial and monetary sovereignty, characteristic of most of the underdeveloped countries. [ABSTRACT FROM AUTHOR]