“Border Effects without Borders: What Divides Japan’s Internal Trade?”
In: International Economic Review, Volume 59 (August 2018), Issue 3, Pages 1209-1262
This article identifies a “border” effect in the absence of a border. The finding that trade between east and west Japan is 23.1% to 51.3% lower than trade within both country parts is established despite the absence of an obvious east–west division due to historical borders, cultural differences, or past civil wars.
“The chinese saving rate: Long-term care risks, family insurance, and demographics”
Ayşe İmrohoroğlu and Kai Zhao
In: Journal of Monetary Economics, Vol 96, June 2018, Pages 33-52
A general equilibrium model that properly captures the risks in old age, the role of family insurance, changes in demographics, and the productivity growth rate is capable of generating changes in the national saving rate in China that mimic the data well.
“Tariff scares: Trade policy uncertainty and foreign market entry by Chinese firms”
Meredith Crowley, Ning Meng and Huasheng Song
In: Journal of International Economics, Vol. 114, September 2018, Pages 96-115
Crowley et al. estimate how a rise in uncertainty about future tariff rates impacts firm decisions to enter into and exit from export markets. Using Chinese customs transactions between 2000 and 2009, they exploit time-variation in product-level trade policy and find that Chinese firms are less likely to enter new foreign markets and more likely to exit from established foreign markets when their products are subject to increased trade policy uncertainty.
“To guide or not to guide? Quantitative monetary policy tools and macroeconomic dynamics in China”
Hongyi Chen, Michael Funke, Ivan Lozev and Andrew Tsang
BOFIT Discussion Papers 3/2017
This paper discusses the macroeconomic effects of China’s informal banking regulatory tool “win-dow guidance,” introduced in 1998. Using an open-economy DSGE model that includes the com-mercial banking sector, we study the stabilizing effects of this non-standard quantitative monetary policy tool and the implications of quantity-based vs. price-based monetary policy instruments for welfare. The analyses are relevant to the current overhaul of Chinese monetary policy.