Demographic Change and Policy Responses: Implications for the Global Economy

The fertility declines associated with the final phase of the global demographic transition have led to slower population growth and accelerated ageing in developed countries and in several advanced developing countries. A global demographic and economic model is used to assess the implications of these changes for population sizes, age‐gender distributions, labour force growth and their implications for economic performance. A baseline projection that incorporates declining fertility is compared with a hypothetical constant population growth scenario. The results show that slower population growth and ageing reduces average saving rates in industrial regions, yet global investment demand is also slowed and saving rates rise in developing regions, so there is no net tightening of financial markets. Increased aged labour force participation, considered one solution to the resulting rise in aged dependency in advanced regions, is found to redistribute investment in favour of the industrialised regions and hence to accelerate their per capita income growth, while conferring on the other regions compensatory terms of trade improvements. The alternative of replacement migration is found to require inconceivably large population movements. It also impairs real per capita growth in destination regions but by least in Western Europe, where the terms of trade are improved by the immigration.     

Absolute and Conditional Convergence in Both Zones of Cyprus: Statistical Convergence and Insitutional Divergence

This paper implements a time series econometric model to determine the timing of full convergence of incomes and output per capita and total factor productivity in the North and South of Cyprus, regardless of whether there is a political settlement or not. A significant dimension of the paper is its emphasis on institutional convergence, going beyond econometric or statistical convergence. Our results reveal that North Cyprus needs 17 years to catch up to full per capita income convergence, 16 years for per capita output convergence and 17 years for full total factor productivity (technological) convergence. The time‐series findings demonstrate that statistical convergence is occurring quite rapidly as the North is catching up to the average income and productivity levels of the South, which may confirm evidence of unconditional (beta) or absolute convergence, but there are significant differences between North and South in savings, tastes, population growth and technology. Most significantly, there are institutional differences highlighted in the study with a Two‐sector model of gate‐keeping and rent‐seeking which validates the premises of conditional convergence. Put differently, there are strong forces of divergence hidden behind our statistical findings.     

What Determines Export Diversification in the Development Process? Empirical Assessment

This paper assesses the role played by country‐specific factors as determinants of relative export diversification. Using a panel data set for 60 countries and 20 years (1985–2004), we confirm that even after clearing out differences in income per capita, cross‐country variability in the degree of export diversification is significant. In general, apart from per capita income, features influencing the size of accessible markets (domestic and foreign) are the most relevant and robust determinants of the export diversification process. Diversification opportunities grow if countries are large and not located far from economic core areas and when barriers to trade are restricted.     

The Payoff to America from Globalisation

This article summarizes the economic payoff to the United States from its postwar trade opening and estimates the potential future gains from more opening going forward. To quantify these gains, we survey different methodologies and estimates. We find that trade opening since World War II has added between $800 billion to $1.4 trillion to the US economy, or about $7,000 to $13,000 per household. More speculative estimates of the potential additional gains from removing the rest of US trade barriers range from $400 billion to $1.3 trillion, or about $4,000 to $12,000 per household. Since trade opening permanently raises national income, these gains are enjoyed annually. Trade opening inevitably entails adjustment costs. We estimate that the lifetime cost of all worker dislocations that have been triggered by expanded trade in the United States could be as high as $54 billion, although probably less. The permanent gains from past and potential liberalization easily swamp the modest sums necessary to alleviate the temporary pains of adjustment. In the future as in the past, free trade can significantly raise income – and quality of life – in America.     

Economic Implications of Mexico's Sudden Demographic Transition

Mexico is in the midst of an unprecedented demographic transition that is changing the size and age structure of its population. The most salient demographic change—and clearly the precursor of most other demographic changes—is the abrupt decline in the country’s fertility rate from 6.5 in the early 1970s to the current 2.2 mark, one of the fastest declines in the world. This dramatic reduction of fertility rates has created a “boom generation” that is currently in its prime working years and that will gradually age and retire. As Mexico experiences sub-replacement fertility rates over the next decades, old-age dependency ratios will escalate to unprecedented levels, carrying significant economic implications, both in Mexico and in the United States. After reviewing the economic literature on the link between demographics and economics, this paper attempts to shed some light on the relationship between Mexico’s demographic patterns and economic development since 1950, offering possible explanations for the apparent lack of an expected connection. The paper then discusses the implications of Mexico’s demographic projections on both sides of the border.     

Business Cycles Synchronicity and Income Levels: Has Globalisation Brought us Closer Than Ever?

Research on business cycle linkages shows a tendency to model countries of relatively the same income levels jointly. However, the issue of whether these countries move along the same business cycles has not been formally investigated in the literature. In this paper, we take this approach and investigate whether each group of countries follows its own dynamics and is therefore subjected to the same business cycle and whether these cycles are independent of each other across income groups. Results indicate that high income per capita countries (HICs) tend to be guided by stronger similarity in business cycles than countries in the middle (MICs) and low income (LICs) groups. In search for an explanation of the business cycles synchronicity observed, panel data analysis was explored. The results from the robust fixed effects estimation show neither trade openness nor shocks to consumption underlie international business cycle synchronization, but rather shocks to oil prices.     

Shopping orientation segments: exploring differences in store patronage and attitudes toward retail store environments among female apparel consumers

The purpose of this study was to identify shopping orientation segments for US female consumers. The sample included 151 women, aged 18 years and over. This research examined differences in the segments relative to store patronage preferences (i.e. department, discount, specialty), attitude toward the environment of the store selected as first choice when shopping for a specific apparel item (i.e. a dress), and demographic characteristics. Cluster analysis revealed that four shopping segments described the female consumers. The segments were named Decisive Apparel Shopper, Confident Apparel Shopper, Highly Involved Apparel Shopper, and Extremely Involved Apparel Shopper, based on several shopping factors. Differences were found among the shopping orientation segments for store of first choice, attitude and household income. Implications and future research directions are discussed.     

Impact of Consumer Installment Debt on Food Expenditures

Trends in consumer installment credit over the period 1980 to 1989 are discussed; as well, a two-equation recursive model is developed to identify and assess the impact of installment credit on food expenditures. The first equation concerns factors affecting the ratio of consumer installment credit to personal disposable income, namely habit persistence, expected income, the prime interest rate, the unemployment rate, and the percentage of the population aged 25 to 44. The second equation focuses on factors affecting real per capita food expenditures, namely the real price of food, real per capita personal disposable income, seasonality, and a polynomial distributed lag of the measure of the ratio of consumer installment credit to personal disposable income from the first equation. The ratio of installment credit to personal disposable income has a positive effect on food expenditures; over the long run a one percent change in this ratio leads to a 0.15 percent change in real per capita food expenditures. On average, it takes just over six months for a change in this ratio to be transferred to food expenditures.     

Export Productivity and Specialisation: A Disaggregated Analysis

The paper analyses export productivity and trade specialisation in China, Brazil, India and South Africa. The investigation calculates a time‐varying export productivity measure using highly disaggregated product categories. The modelling shows that export productivity is determined by real income and human capital endowments. But the empirical analysis also reveals significant differences in export productivity and specialisation for countries with comparable per capita income levels.     

Economic Effects of the Syrian War and the Spread of the Islamic State on the Levant

This paper uses a global computable general equilibrium framework with new detail on six Levant countries – the Arab Republic of Egypt, Iraq, Jordan, Lebanon, the Syrian Arab Republic and Turkey – to quantify the direct and indirect economic effects of the Syrian war and the advance of the Islamic State on the Levant. Syria and Iraq bear the brunt of the direct economic costs, while the other Levant countries lose in per capita but not in aggregate terms as the inflows of refugees increase the size of their populations. The war has undermined progress towards deeper regional trade integration, thus adding to varying degrees to the direct costs sustained by the Levant economies and, in the cases of Syria and Iraq, doubling their welfare losses. All Levant countries are foregoing opportunities to expand intra‐Levant trade and the associated gains in economic efficiency. The average welfare effects are not indicative of the distributional effects of war within countries.     

Redistribution of Trade Gains in the Presence of Firm and Worker Heterogeneity

Trade gains are unequally distributed; in particular, low‐ability workers lose out in terms of wages and employment probability. In this paper, we investigate the impact of redistribution schemes on aggregate and disaggregate variables. To this end, we built a trade model with trade unions, heterogeneous firms and workers. Three redistribution schemes are distinguished: unemployment benefits financed by either a wage tax, a payroll tax or a profit tax. We find that: (i) all three redistribution schemes reduce output per capita; (ii) but the marginal reduction is lowest in the wage tax funding scenario; and (iii) If the profit tax is used, labour demand for low‐ability workers increases.     

影响我国收入分配不公平的若干产权制度问题研究

产权制度的不完善是引起我国收入分配不公平和贫富差距的重要根源。现行农村土地产权制度造成土地所有权收入被政府获得,国有资本经营收益分配制度的不完善造成本应属于全民获取的国有资本经营收益被国有企业获得,矿产资源产权制度的缺陷使得本属于国家矿产资源所有权的收入被少部分人获得。这些都是影响我国当前收入分配不公平的深层次问题,未来应该从制度根源上进行改革,不断完善产权制度,从根源上解决收入分配不公平问题。     

China’s belt and road initiative and regional perceptions of China

China’s growing outward investment in Asia-Pacific is motivated by the potential for economic gains, but could also affect regional geopolitical risk. Using survey data from 2005 to 2016, we show that an increase in Chinese FDI in a country improves respondents’ perceptions of Chinese influence on their country. We also show that perceptions of China are correlated with future business confidence in Asia-Pacific countries. With China advancing plans for further regional investment, notably through the Belt and Road Initiative, the economic and business outlook for Asia-Pacific could improve significantly, adding to existing advantages from regional economic and demographic trends.     

"全面二孩"、人口年龄结构变动与长期经济发展:2017～2050

本文实证分析"全面二孩"政策的实施对人口年龄结构的影响及由此带来的经济发展水平和增长速度的影响.研究结果表明,"全面二孩"政策的实施使少儿抚养比显著提高,劳动年龄人口占比不会上升,老龄化程度得到一定减轻,但无法改变人口迅速老龄化的总趋势.该政策的实施尽管显著提高了少儿抚养比,但并没有创造出新的"人口红利",因而该政策在一定时期内对经济发展水平产生一定的负面影响.     

How Income and Crowding Effects Influence the World Market for French Wines

Wine prices rose rapidly between 2001 and 2011 but have now stagnated. The growth phase could be explained by the increased demand from emerging markets, while the subsequent stagnation may result from the crowding effect caused by the entry of numerous new varieties onto the wine market. The generalised model of ideal variety proposed by Hummels and Lugovskyy combines these two elements, and focusing on French exporters, we find partial support for this explanation at the world level. A 1 per cent increase in GDP per capita (income effect) generated an increase in price of 1.13 per cent between 2001 and 2011. In contrast, a 1 per cent increase in market size (competition effect) reduced prices by 1.10 per cent over the same period. This paper goes further into the analysis of these effects by considering wine exports according to the mode of transport used and indirectly evaluates economies of scale when wine is exported by land, sea or air (via a gravity equation). Economies of scale are observed for transport by plane and ship but not for road. A 10 per cent increase in the value of wine exported by road (plane) leads to a rise (reduction) in transport costs of 0.5 per cent (19 per cent).     

中国未来生育政策的选择

近年来社会上对是否应该放开中国的计划生育政策有很多争论。争论的起因是由于一些调查数据反映的和某些学者估计出的我国目前生育率非常低;鉴于低生育率已经给比较发达的国家带来了很多问题,所以有人呼吁中国的生育政策应该放开。通过对放开生育政策和不放开生育政策两种情形可能导致的人口学后果进行估计,结合国外的经验和教训,从低生育率的长期后果来分析如何合理地选择生育政策。为了避免人口达到零增长后的快速负增长、快速老龄化和人口规模的迅速减少,国家应该密切关注人们生育意愿的变化,必须在适当的时候放开生育政策,使生育水平保持在2.0左右,从而尽可能地避免长期的、过快的负增长给国家和社会带来更为严重的人口与社会经济问题。     

低生育稳定期：中国特色的人口转变阶段

从人口转变角度审视和分析当前中国人口发展的形势,提出中国的人口转变有一个独特的阶段,即低生育稳定期。分析了低生育稳定期的阶段性特征。这个时期问题复杂,趋向明朗,是主要矛盾转换期和生育政策调整期。还分析了这一时期中国人口发展战略目标的转换及相应的对策。     

Food security and government interventions: A study of Indian grain markets

Abstract

This study examines the future of Indian food security in light of possible liberalization of its agriculture sector. Demand for major food grains such as wheat and rice is projected after taking into account possible dietary changes due to income growth, urbanization and other demographic changes. Policy Analysis Matrix (PAM) indicators are constructed to predict changes in supply patterns in the case of reduced government intervention. The projected demand growth suggests faster increases in per capita wheat consumption due to strong income growth and urbanization whereas per capita rice consumption is projected to level off in the next few years and then will likely decline steadily for the remainder of the projection period. This indicates that Indian wheat production may need to grow at a much faster rate than rice production in order to remain self-sufficient in the future. Based on the PAM ranking, this may be possible under reduced or no government interventions because of the comparative advantage of wheat over rice in the major growing regions.     

ECONOMIC IMPACTS OF INCREASED MEXICO-U.S. LABOR MOBILITY: A Computational General Equilibrium Analysis

ABSTRACT

China has emerged as the fastest-growing economy in the world. In this context, I discuss the antecedents, characteristics, and consequence of China’s rise in the world economy with reference to the “four W” framework (What, When, Where, and Why). This article provides insights into the role of exports and FDI in China’s rise. Theoretical as well as real-life factors contributing to this success are also listed. Comparative analysis with other emerging countries, such as India, is provided. In addition, directions for future research are outlined.     

Inflation,Accounting and the Canadian Corporate Tax Base

Relationships between 1983 income tax paid and newly reported, inflation-adjusted measures of net income are examined. Canadian corporations in the sample paid about half of the 1983 income taxes collected from Canadian, non-financial enterprises with assets exceeding $10 million. If the measures of net income are accepted as valid, then it can be inferred that in 1983, Canada's corporate tax system acted as if:

• 1 Income maintaining operating capability was taxed at a relatively low marginal rate (approximately 26 per cent).
• 2 Realized holding gains, allegedly required by firms to maintain operating capability and therefore not to be taxed, were taxed at a relatively high marginal rate (about 59 per cent).
• 3 Purchasing power gains on net monetary liabilities, which are in substance returns of principal to lenders, were confiscated (i.e., taxed at more than 100 per cent).

If income maintaining operating capability plus purchasing power gains had been taxed explicitly, and if all other allowances and deductions had been abolished, a 51 per cent tax rate would have maintained the government's tax revenues from firms that had positive taxable income in 1983. However, the tax burden would have shifted toward manufacturers and resource firms, and away from retailers, wholesalers, and, regulated utilities. The paper explains how the new accounting income constructs are computed, analyzes the apparent incidence of tax payable on various components of income using cross-sectional regression models, and discusses the significance of the findings for corporate tax policy. Evaluation of the results of the study raises interesting normative issues. One interpretation is that the government over-taxed realized holding gains that the corporations needed to maintain their operating capability. Another is that the tax system rewarded (perhaps unintentionally) corporations that were efficient in producing income maintaining operating capability. Résumé Les rapports entre l'impot sur le revenu payé en 1983 et les nouvelles mesures de revenu net indexées à l'inflation sont examinées ici. Les sociétés canadiennes de l'échantillonnage ont payé environ la moitié des impots levés auprès des entreprises canadiennes non financières dont l'actif excédait $ 10 millions. Si les mesures de revenu net sont acceptées comme valides, on peut alors conclure qu'en 1983 le système fiscal Ides sociétés a eu l'effet suivant:

• 1 La capacité d'exploitation assurant les revenus a étép imposée à un taux marginal relativement bas (environ 26%).
• 2 Les gains de plus-value qui sont soi-disant nécessaires pour maintenir la capacité d'exploitation et qui ne devraient donc pas ětre imposés, l'ont été à un taux marginal relativement élevé (environ 59%).
• 3 Les gains de pouvoirs d'achat sur la dette nette, qui constituent en fait un remboursement de principal au prěteur, ont été confisqués (c.-à.-d. imposés à plus de 100%).

Si la capacité d'exploitation et les gains de pouvoir d'achat avaient été imposés plus spécifiquement, et si toutes les allocations et les déductions avaient été abolies, un taux d'imposition de 51% aurait maintenu les revenus d'impǒt du gouvernement obtenus auprès de sociétés dont le revenu imposable était positif en 1983. Le fardeau aurait toutefois été déplacé vers les manufacturiers et les sociétés de ressources libérant les détaillants, les groissistes et les services publics réglementés. Cette étude explique comment sont calculéps les modèles de comptabilité des revenus et analyse l'incidence apparente de l'impǒt payable sur différentes composantes du revenu en utilisant des modèles de régression par coupes transversales et discute de l'implication des résultats sur la politique d'imposition des sociétés. L'évaluation des résultats de l'éptude soulève des questions normatives intéressantes. Une des interprétations veut que le gouvernement ait surimposé la plus-value requise par les sociétés pour maintenir leur capacité d'exploitation. Une autre interprétation est que le système ait récompensé (peut-ětre involontairement) les sociétés qui maintiennent avec efficacité leur capacité d'exploitation.