GOVERNMENT CONSUMPTION AND THE COMPOSITION OF PRIVATE EXPENDITURE: A CONDITIONAL ERROR CORRECTION MODEL

In this paper we provide empirical evidence of the relationship between government purchases and private expenditure by adopting a microeconomic approach. Using UK quarterly data, a long‐run demand system conditioned to the public sector is obtained by specifying a vector error correction model in which government consumption is assumed as an exogenous I(1) forcing variable. Our findings reject the hypothesis of separability of individual preferences between public and private expenditures, with simultaneous crowding‐out/in effects. Moreover, crowding‐out effects of government consumption on private spending are found to be larger for those goods and services that produce similar utility.     

RISK,UNCERTAINTY AND CHINA'S EXPORTS*

Both theoretical and empirical models were developed in this paper to examine how exporters’ response to real exchange rate volatility (RERV) and real exchange rate misalignment (RERM) varies across industries in China. The theoretical model indicates that the impact of RERV depends on exporters’ attitude to risk while the effect of RERM is ambiguous. Using disaggregated industry data, Chinese exporters were found to be averse to RERV and RERM. This suggests that the negative impact on China's exports resulting from a revaluation of the RMB will be mitigated by a positive impact due to the reduction of RERM.     

实际汇率、进出口贸易和我国城乡收入差距——基于结构VAR模型的动态分析

城乡收入差距的持续扩大是我国经济社会发展面临的一个突出问题。除了对它作价值判断外,更重要的是要搞清楚城乡收入差距持续扩大的原因。在结构VAR模型基础上,讨论实际汇率、贸易开放对城乡收入差距潜在的动态影响。研究发现:①实际汇率升值和贸易自由化都会扩大城乡收入差距。②实际汇率冲击能解释50%左右的贸易开放度波动,累积负效应在长期内才能转化成正效应。③贸易开放度冲击对收入差距的影响呈W型,累积影响是持续加剧了城乡收入差距。④实际汇率对收入差距的影响呈M型。尽管实际汇率冲击在一年之后只能解释8%左右的收入差距波动,但累积传递率从第7个季度开始不断上升。     

COMPETITIVE GROWTH IN A LIFE‐CYCLE MODEL: EXISTENCE AND DYNAMICS*

The dynamic behavior of the capital growth rate is analyzed using an overlapping‐generations model with continuous trading. Assuming a technology satisfying constant social returns to capital, the equilibrium growth rate is piecewise‐defined by functional differential equations with both delayed and advanced terms. The main result concerns the existence of a solution expressed as a series of exponentials, which is shown to crucially depend on the initial wealth distribution among cohorts. Upon existence, the dynamics of the capital growth rate has a saddle‐point trajectory that converges to a unique steady state. Along the transition path, the growth rate exhibits exponentially decreasing oscillations.     

外贸对经济增长的影响分析:理论与经验模型验证

国际贸易理论的核心问题是探究贸易利益的产生及其分配,国际贸易与经济增长具有密切联系。理论分析和经验证据均表明,一国外贸规模对经济增长有着重要作用,对外贸易的变动往往成为决定一国经济增长趋势的关键因素。文章从理论和经验模型上对我国近10多年来外贸和经济增长的关系给出了相关的实证检验,旨在探讨并揭示国际贸易促进经济增长的内在机制。     

PRODUCTION AND CONSUMPTION OF EDUCATION IN A R&D-BASED GROWTH MODEL

We develop a R&D‐based growth model with endogenous accumulation of human capital. We investigate the idea that education is a good entering in the preferences of individuals. We seek to analyse how the decisions of individuals to invest in human capital can be altered by changes in economic policies and how they can be reflected on the level of growth in the long run. We show that policy changes affect growth through their effect on the decision of individuals to invest in human capital. The effects obtained depend whether individuals enjoy to acquire education or if they consider it as a ‘bad’. In the absence of any policy intervention, the level of growth can be excessive or insufficient compared with the optimum.     

THE DETERMINANTS OF EXPORT PERFORMANCE: EVIDENCE FOR MANUFACTURING PLANTS IN IRELAND AND NORTHERN IRELAND

The dramatic GDP and export growth of Ireland over the last decade forms a marked contrast with that of its nearest neighbour Northern Ireland. In Ireland, export volume growth averaged 15.5% p.a. from 1991 to 1999 compared with 6.3% from Northern Ireland. Using data on individual manufacturing plants this paper considers the determinants of export performance in the two areas. Larger, externally owned plants with higher skill levels are found to have the highest export propensities in both areas. Other influences (plant age, R&D, etc.) prove more strongly conditional on location, plant size, and ownership. Structural factors (e.g. ownership, industry) explain almost all of the difference in export propensity between larger plants in Northern Ireland and Ireland but only around one‐third of that between smaller plants. Significant differences are also evident between plants in terms of their sources of new technology. For indigenously owned plants, in‐house R&D is important. For externally owned plants, R&D conducted elsewhere in the group – typically outside Ireland and Northern Ireland – proves more significant. This external dependency and lower than expected export propensity on the part of small plants in Northern Ireland represent significant policy challenges for the future.     

A ONE-SECTOR NEOCLASSICAL GROWTH MODEL WITH ENDOGENOUS RETIREMENT

This paper extends Diamond's overlapping generations model by allowing the agents to make the retirement decision. Earning a higher wage income when young not only enables the agents to save more. It also induces more agents to retire early and gives an additional incentive to save more for retirement. This leads to a higher capital–labour ratio in the following period and hence the next generation of agents earns a higher wage income when young. Due to this positive feedback mechanism, endogenous retirement magnifies the persistence of growth dynamics and even generates multiple steady-states for empirically plausible parameter values.     

SOCIAL STATUS,EDUCATION AND GOVERNMENT SPENDING IN A TWO‐SECTOR MODEL OF ENDOGENOUS GROWTH*

This paper extends the relative wealth specification of status preference to the two‐sector Uzawa (1965 )– Lucas (1988 ) model and examines the effectiveness of government spending on economic growth. It is found that the desire for relative wealth‐induced social status and/or the education component of relative wealth‐induced social status are important ingredients in determining the growth rate effects of government spending. Provided that the agent is concerned with his or her relative social position, the education‐induced social status plays a more important role than the physical‐asset‐induced social status in determining the validity of public spending on growth. If individuals do not care about their education‐driven social rewards, then an increase in government spending has no effect on the balanced growth rate regardless of the presence of the physical‐asset‐induced social status. A rise in government spending reduces the long‐run growth rate if the education‐induced social status is present.     

ARMS EXPORT CONTROLS, SUBSIDIES AND THE WTO EXEMPTION

Owing to the World Trade Organization (WTO) exemption that allows governments to subsidize arms exports, the arms trade is one of the few remaining areas of trade where we observe export subsidies. This paper examines the effect of arms controls, in the form of licensing delays, on the incentives to subsidize arms exports and conversely the effect of the WTO arms trade exemption on the incentives to break arms control agreements. Our main result is that arms controls and free trade commitments re‐enforce each other. Licensing delays reduce the incentive to subsidise and free trade without subsidies reduces the benefits of a unilateral abrogation of arms controls. Transparency actually worsens the Nash inefficiencies at play in that incomplete information leads to lower subsidies and lower arms exports.     

A SAVINGS SUBSIDISATION SYSTEM IN A MODEL OF ENDOGENOUS FERTILITY AND ENDOGENOUS GROWTH: AN EXTENSION OF WIGGER (1999)

Population ageing is now an established demographic characteristic of many economies. Economists working in the endogenous growth theory tradition have sought to model the relationship between public pensions, financed on a 'Pay-As-You-Go' basis, and the growth in per capita incomes. The resultant intergenerational wealth redistribution from young to older people seems to decrease private savings, diminish capital accumulation, and lower the growth of per capita incomes. The underlying transmission mechanism appears to be a crowding out effect in private capital markets contingent upon the introduction of public pension systems. A growing literature exists on the interrelationships between public pension schemes, fertility rates and endogenous growth. Following Wigger's (1999) pioneering overlapping generations endogenous growth model, we extend this model to examine the effects of a savings subsidisation system on the rate of per capita income growth, fertility and voluntary intrafamily wealth transfers, where parents view children both as an insurance good and a consumption good. Moreover, children care about the consumption levels of their parents. An increase in contributions to a savings subsidised public pension scheme will crowd out private intergenerational transfers from the young to the old and thereby negate the usefulness of children as an insurance good.     

沪港服务输出的比较研究

随着全球经济的快速发展,服务贸易在国际经济中的地位迅速提高,并逐渐成为衡量一国或地区国际竞争力的重要标准。沪港作为中国服务贸易发展较快的两个地区,而且又是未来东亚乃至全球经济中心的潜在竞争对手,所以两者在一定程度上具有可比性。因此,从三个方面对沪港两地的服务输出比较研究,发现它们之间存在较大的差异,并从差异原因的分析中总结出两地服务输出发展的成功经验,以期为北京、广州等地提供借鉴。两地在未来关系的发展中,应相互合作,实现共赢。     

FISCAL POLICY IN AN ENDOGENOUS GROWTH MODEL WITH PUBLIC CAPITAL AND POLLUTION

This paper studies the growth and welfare effects of fiscal policy in an endogenous growth model with public capital and environmental pollution. I assume that pollution is due to aggregate production, and that it does not have a direct effect on production but only reduces household utility. I study the growth effects of fiscal policy for the model on the balanced growth path, taking transition dynamics into account. I then analyse the welfare effects of fiscal policy along the balanced growth path. Finally, I show how the fiscal parameters must be set so that the competitive economy replicates the social optimum.