Intergenerational income persistence and transmission mechanism: Evidence from urban China

In this paper I investigate the intergenerational income association and its transmission channels amid China's economic transition period using urban data from the Chinese Household Income Projects in 1995 and 2002. The estimated intergenerational income elasticity is 0.43 and 0.51 for cohorts educated prior to and after the market reform respectively, and reaches 0.71 among households with above average income in the post-reform era. Besides the conventional channel of education, this paper estimates the contribution from social capital and ownership of work unit across cohorts and income groups. There is weak evidence that prior to market reform, ownership of work unit contributes most to the intergenerational income persistence for households with below average income, while social capital leads the three contributors in households with above average income. However, in the post-reform era, parents with below average income invest statistically significantly in children's education which contributes most to the intergenerational income persistence. The leading contributor in families with above average income shifts to social capital. Possible explanations for such a shift lie in the ability and incentive of parents from different income categories to invest in their children. The results are tested through a series of robustness checks, and provide empirical support for promoting policies on the equality of opportunity.     

The impact of foreign direct investment and human capital on economic growth: Evidence from Chinese cities

Using a panel of Chinese cities over the period 1991–2010, we examine the determinants of economic growth, focusing on the role of foreign direct investment (FDI) and human capital. Consistent with the predictions of a human capital-augmented Solow model, we find that the growth rate (along the path to the steady-state income level) of per capita GDP is negatively correlated with population growth rate and positively correlated with investment rate in physical capital and human capital. We find that FDI has a positive effect on the per capita GDP growth rate and this effect is intensified by the human capital endowment of the city. The latter suggests that one way that human capital contributes to growth is to serve as a facilitator for technology transfers stemming from FDI. Furthermore, we find some suggestive evidence that the FDI-human capital complementary effect is stronger for technology-intensive FDI than for labor-intensive FDI. Our results are robust to alternative measures of human capital, model specifications, and estimation methods.     

The impact of education on income inequality and intergenerational mobility

This paper analyses the effects of innate ability, compulsory education (grades 1–9), and non-compulsory education (grades 10–12 and higher education) on inequality and intergenerational mobility of income, by constructing a four-period overlapping-generation model. We find that innate ability and family investment in early education play important roles in explaining income inequality and intergenerational income mobility. Though children from the wealthiest families are only 1.36 times ‘smarter’ that those from the poorest, the gap in human capital expands to 2.35 at the end of compulsory education and to 2.89 at the end of non-compulsory education. One important reason for the increase is that poor families invest relatively less in children's early education than do wealthy families; therefore, their children attend lower-quality schools, which results in them being much less likely to participate in higher education. By simulating policy experiments for different types of government education expenditure, we find that direct subsidies to poor parents are the most efficient and effective policy for mitigating poor families' budget constraints with regard to early-education investment in their children.     

The impact of agricultural technology adoption on income inequality in rural China: Evidence from southern Yunnan Province

This study analyzes the impact on income inequality of government efforts to increase agricultural incomes in rural China. It collects and analyzes survey data from 473 households in Yunnan, China in 2004. In particular, it investigates the effects of government efforts to promote improved upland rice technologies. Our analysis shows that farmers who adopted these technologies had incomes approximately 15% higher than non-adopters. Despite this relatively large increase, we estimate that the impact on income inequality was relatively slight. This is primarily due to the fact that lower-income farmers adopted the improved rice technology at rates that were roughly equivalent to those of higher-income farmers.     

The determinants of capital structure: Evidence from China

This paper employs a new database containing the market and accounting data (from 1994 to 2003) from more than 1200 Chinese-listed companies to document their capital structure characteristics. As in other countries, leverage in Chinese firms increases with firm size and fixed assets, and decreases with profitability, non-debt tax shields, growth opportunity, managerial shareholdings and correlates with industries. We also find that state ownership or institutional ownership has no significant impact on capital structure and Chinese companies consider tax effect in long-term debt financing. Different from those in other countries, Chinese firms tend to have much lower long-term debt.     

我国企业人力资本参与企业收益分配的几个误区

我国虽然已经进行人力资本参与企业收益分配多种尝试,但是中国并不适合于全面推行人力资本参与企业收益分配。这是因为我国刚刚步入工业化中期阶段,人力资本还没有完全作为一种独立的资本形态出现,有限责任制度难以真正实现,企业治理结构还处于构建之中。从我国人力资本参与企业收益分配的实践看,由于种种原因,我国企业在实施人力资本参与企业收益分配过程中存在误区。     

A cointegration approach to capital mobility: Evidence for Belgium

This paper provides a method for measuring capital mobility through the analysis of causality direction between the exchange rate and the interest rate. Empirical evidence is provided for Belgium. Cointegration and Granger causality tests show that the direction of causality between both variables reverses in 1979 when an increase in the degree of European financial integration took place.     

Industry-specific human capital and the wage profile: Evidence from Taiwan

Using data from Taiwan's Manpower Utilization Survey (1979–2000), this paper finds evidence that supports the industry-specific human capital effect on wage tenure profiles. Work experience is used as an indirect measure for testing industry-specific human capital by comparing the effect between stayers and movers. Other things being equal and holding firm tenure constant, movers actually incur a wage loss measured by the wage premium of the work experience. However, a greater than average firm tenure effect, especially for movers in the voluntary group, reflects an underlying job-related matching process. We also find that the effect of work experience declines with education, while the effect of industry-specific human capital increases with education. JEL no. J24, J31, J41, J62.     

福建农村人力资本水平与农民收入

采用国家统计局福建农村住户调查数据,实证分析了农户家庭人力资本水平与家庭收入之间的关系,结果表明:户主的文化程度越高,农户家庭的总收入越高,家庭收入中来自稳定的收入越多,收入来源越多样化,家庭的生活水平越稳定。随着家庭平均教育水平的提高,农户家庭的收入也不断提高,教育投资的收入弹性呈递增趋势,随着时间的推进,教育对收入的效应逐渐加大。从培训来看,接受培训的农户家庭,其收入明显高于未接受者培训的家庭的人均纯收入,而且随着家庭劳动力接受培训次数的增加,家庭收入也不断增加。     

Intergenerational mobility and institutional change in 20th century China

We examine the persistence of socioeconomic status across generations, measured by educational attainment, among urban Chinese born between 1930 and 1985. The persistence of status follows a pronounced, robust U-shaped pattern, falling among cohorts educated following the Communist revolution of 1949, and rising among cohorts educated following the reforms of the late 1970s. The pattern is not driven by the Cultural Revolution or by changing associations between education and income. The U-shape also appears in complementary datasets covering rural China. We discuss the policies behind a non-monotonic relationship between educational expansion and social mobility across the institutional regimes we study.     

Productive government expenditure and its impact on income inequality: evidence from international panel data

Review of World Economics - This paper addresses the impact of productive government expenditure on income inequality using a dataset of 80 countries over the period of 1980–2015. It...     

论人民币资本账户可兑换的收益与风险

本文通过对人民币资本账户可兑换的收益和风险进行了分析和研究,认为现阶段其风险大于收益,激进式实现是不可取的,但从长远来讲,人民币资本账户可兑换是中国经济和金融进入全球化的内在要求,应该继续平稳地推进人民币资本账户可兑换的进程。     

Savings,investment, and capital mobility within China

This paper addresses the capital mobility among regions within China. Using a range of panel estimators which deals with the non-stationarity of time series components, individual heterogeneity and common unobserved factors, we show that the savings and investment (both expressed as ratios to GDP) are positively correlated for a sample of 28 Chinese provinces over the period of 1978 to 2006. According to the Feldstein-Horioka's argument (1980, Economic Journal (90), pp.314–329), such a correlation can be interpreted as evidence of low capital mobility. In addition, by means of Granger causality test, we fail to provide consistent evidence to support the hypothesis of efficient capital allocation in China. Combining the results given above, it is believed that the capital may be inefficiently retained within the provincial confines. We conjecture that the intermarriage between financial power and local authorities is primarily responsible for this worrying phenomenon.     

The composition of the human capital stock and its relation to international trade: Evidence from the US and Britain

The Composition of the Human Capital Stock and Its Relation to International Trade: Evidence from the US and Britain. — This paper examines the factor intensity of US and UK trade using standard factor content techniques. In particular, it considers the role of labour skills in international trade. The principal focus is to demonstrate that specialisation according to skills has two dimensions-according to the general level of human capital and according to different types of skill at the same level of education and training. This analysis is conducted for different trading partners for each country. The paper also offers some methodological evidence on the effects on factor content analysis of the (dis)aggregation of factors and on the role of internationally varying production techniques.     

Openness,human capital and total factor productivity: evidence from China

This paper examines the drivers behind China's economic growth. In particular, it focuses on the channels of knowledge spillovers: human capital and openness to trade and foreign direct investment. The specific features of the study include using the most recent comprehensive panel data consisting of 29 provinces during the period 1994–2006 and performing unit root and cointegration tests in the panel data framework. The paper finds that human capital, trade and FDI are the significant determinants of total factor productivity, but their importance varies with technological levels of provinces. These findings have important policy implications.     

Rural households' decisions towards income diversification: Evidence from a township in northern China

Economic reforms in rural China have brought opportunities to diversify both within-farm activities and off-farm activities. Participation in these activities plays an important role in increasing rural households' income. This paper analyzes the factors that drive rural households and individuals in their income-source diversification choices in a Northern China township. At the household level, we distinguish three types of diversification as opposed to grain production only: within-farm (non-grain production) activities, local off-farm activities, and migration. We find that land availability stimulates on-farm diversification. Local off-farm activities are mostly driven by households' asset positions and working resources, while migration decisions strongly depend on the household size and composition. At the individual level, we analyze the determinants of participation in three different types of jobs as compared to agricultural work: local off-farm employment, local self-employment and migration. We find a clear gender and age bias in access to off-farm activities that are mostly undertaken by male and by young people. The households' asset positions as well as village networks are found to strongly affect participation in off-farm activities.     

Preferential policies and income inequality: Evidence from Special Economic Zones and Open Cities in China

This paper examines whether cities with preferential policies have higher inequality in household disposable income per capita than cities without preferential policies in urban China. “Preferential policies” refers to the autonomy and deregulation given to Special Economic Zones (SEZs) and Open Cities, allowing them to experiment with market policies and reforms, as the country moves from a state-controlled economy towards a market-oriented economy. While the effect of these policies on economic growth is extensively documented, their relationship with income inequality remains undetermined. Subgroup decompositions of income inequality, using the China Household Income Project's urban datasets of over 6000 households and 20,000 individuals from of up to 70 cities from 12 provinces, were used to identify income inequality gaps between cities with and without preferential policies. The results reveal that while income inequality increased in urban China from 1988 to 2007, the change was lower for cities awarded preferential policies across regions. Furthermore, the decompositions by region indicate that cities receiving preferential policy treatment had higher income growth but a lesser increase in income inequality than cities without preferential policies in each region. Finally, cities receiving preferential policies were able to increase the share of income of the poorest 40% of households while reducing the share of the richest 10%.     

资本的权力与资本收入的性质

经典作家们关于资本收入性质的分析无疑是正确的。但在今天讨论资本收入是不是剥削收入时,应结合新的历史条件和新的实际来做科学的回答。我们认为,不能把我国现实中存在的私人资本收入一概认定为剥削收入,应该具体情况具体分析。     

Assessment of the impact of human capital on economic growth

This paper presents updated figures on the dynamics of human capital in the Russian economy. Time series of human capital are obtained for major types of economic activity that cover up to 85–90% of the total human capital in the Russian economy for 1992–2012. An analysis of the impact of accumulated human capital on economic dynamics is performed by means of the production function model. An original approach to assessing the production function based on the method of principal components is introduced.