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- Ge, Jinfeng, et al.
(author)
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Misallocation in Chinese Manufacturing and Services : A Variable Markup Approach
- 2019
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In: China & World Economy. - : Wiley. - 1671-2234 .- 1749-124X. ; 27:4, s. 74-103
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Journal article (peer-reviewed)abstract
- Cross-country comparison reveals an unusually small service sector in China. Using firm-level data from China's 2008 economic census, we find two facts that speak to a novel mechanism of misallocation within service and between manufacturing and service sectors. First, compared with the manufacturing sector, there are more state-owned enterprises and fewer entrants in the service sector. Second, markups increase with firm size, and the increase is more dramatic among service firms. We interpret these facts through the lens of a monopolistic competition model with heterogeneous firms and variable markups. A multisector model shows a new channel that translates asymmetric barriers to entry across sectors into sectoral markup differences, which in turn cause sectoral misallocation. Quantitative analysis shows that when reducing entry barriers to service firms to the extent observed for manufacturing firms, the model predicts a 12-percentage-point increase in the service employment share.
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- Gustafsson, Björn, 1948, et al.
(author)
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Self-employment in Rural China: Its Development, Characteristics, and Relation to Income
- 2022
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In: China & World Economy. - : Wiley. - 1671-2234 .- 1749-124X. ; 30:1, s. 136-165
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Journal article (peer-reviewed)abstract
- Changes in the employment structure in rural China were studied with a focus on off-farm self-employment. Data from the Chinese Household Income Project surveys were used, covering the same 14 provinces from 1988 to 2018. We found that the proportion of adults in rural China with self-employment as their primary form of off-farm employment increased from only 2 percent in 1988 to 11 percent in 2013, with no further increases through 2018. In 1988 and 1995, the rate of self-employment was highest in the eastern region but this regional pattern subsequently disappeared. The probability of being self-employed in rural China was higher among married males than among unmarried persons. Having a migration experience increased the likelihood of being self-employed. Since 1995, self-employed households have had a higher average income than other categories of household. Based on estimates of income functions, we conclude that the income premium from being self-employed increased rapidly from 1988 to 1995 to become remarkably large when only a few adults were self-employed. However, as a larger fraction of the rural population entered self-employment, the payoff from being self-employed has rapidly diminished, although it was still substantial in 2018.
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| 4. |
- Sicular, Terry, et al.
(author)
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The Rise of China’s Global Middle Class in an International Context
- 2022
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In: China & World Economy. - : Wiley. - 1671-2234 .- 1749-124X. ; 30:1, s. 5-27
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Journal article (peer-reviewed)abstract
- We estimate the size of the global middle class in China and 33 other countries and analyze China’s expanding middle class in an international context. The “global middle class” is defi ned in terms of being neither poor nor rich in the developed world. China’s global middle class has grown rapidly and has been catching up with the middle class in developed countries. By 2018 China’s global middle class constituted 25 percent of China’s population; in absolute size it was nearly double the size of the global middle class in the US and was similar in size to that of Europe. Cross-country analysis of the relationship between the middle-class share of the total population and GDP per capita reveals an inverted-U pattern. China is not an outlier from the cross-country pattern but the speed with which its middle-class has expanded is unusual. The only other countries with similarly large, rapid expansions of the middle class are transition economies.
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- Xiong, Ailun, et al.
(author)
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Social Capital and Total Factor Productivity : Evidence from Chinese Provinces
- 2017
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In: China & World Economy. - : Wiley-Blackwell. - 1671-2234 .- 1749-124X. ; 25:4, s. 22-43
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Journal article (peer-reviewed)abstract
- The impact of social capital on economic development has been broadly studied by scholars. However, research in the Chinese context is relatively rare. Drawing upon data from the China General Social Survey, our results suggest that the enhancing effect of social capital on total factor productivity is very limited in the case of China. The network dimension of social capital is significant only in pooled OLS estimations, and trust as well as the participation dimension of social capital exert no impact across all estimations. Our interpretation is that this is partly due to the fact that trust, values and norms formed in civil society are inherently difficult to transmit to the market sector. Besides, the impact of social capital on economic performance is undermined when physical capital plays a significant role in production. We therefore propose that the effect of social capital on economic performance is contingent on localized social and economic conditions.
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