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The fast increase of foreign exchange reserve in developing countries has raised a number of important financial questions in recent years. The analysis of the optimal scale of the foreign exchange reserve can provide important indicator to measure the strength and stability of country’s financial standing. In this work we propose a cost-profit model and use the financial data during 2000 to 2008 to analyze the optimal scale of China’s foreign exchange reserve. We identify a number of financial factors to measure the cost and profit of holding the reserves. Our prediction suggested that China’s foreign exchange reserves were still within the moderate range in 1999–2001. However, during 2002–2008 the foreign exchange reserve began to exceed the appropriate scale, and this upward trend was accelerated each year. [ABSTRACT FROM AUTHOR]

The rapid development of the digital economy is a powerful driving force to promote high-quality economic growth all over the world. Although a number of studies have been conducted to investigate the development of the digital economy in China, these studies pay little attention to the spatial linkages between the 30 provinces in China and the developmental differences between northern and southern China. Using Chinese digital economic data from 2004 to 2019, we propose an index system to measure the developmental levels of the digital economy and obtain the annual developmental levels of these provinces by using the factor analysis method. We analyze the regional differences of developmental levels by using the Theil index and kernel density estimation method. More importantly, the network method is used to analyze the correlations between the developmental levels of the digital economy in all provinces of China. By decomposing regional differences, our study shows that polarized and uncoordinated development is prominent. The development level of the digital economy in the southern region is higher than that in the northern region. In terms of regional correlations, the network study suggests that there are beneficial and spillover effects of the digital economy development between provinces. Based on the analysis results, we propose policies for improving the development of the digital economy in China. [ABSTRACT FROM AUTHOR]