China's Trade Slowdown: Cyclical or Structural?

This paper analyzes whether the slowdown of China's trade in 2012–2015 was cyclical or structural, and further discusses the effects of structural factors, including trade structure, trade protectionism and global value chain participation. Using the national panel data from 2000 to 2015, based on the error correction model and import‐intensity‐adjusted demand model, our results show that the slowdown of China's trade growth in 2012–2015 was mainly a result of cyclical factors. Using 2000–2015 industry‐level data, we also find that the structure of trade goods had an inhibitory effect on the import slowdown but a positive effect on the export slowdown. Trade protectionism had an adverse effect on the trade growth slowdown. The global value chain participation marginally contributed to the slowdown in trade growth. Therefore, the impacts of structural factors on trade growth slowdown cannot be ignored, and related policies should receive greater attention from policy‐makers.     

An Analysis of Black–White Wage Differences in Nursing: Wage Gap or Wage Premium?

This paper analyzes whether a black–white racial wage differential exists in the nursing labor market in the US. Despite claims of a nursing shortage, little examination of whether racial inequalities in the labor market might contribute to this purported shortage has occurred. Possible explanations for black–white differences in RN compensation include racial differences in: occupation; returns to skills; metropolitan residency; union membership. Regression analysis on wages for registered nurses (RNs) was conducted. Findings suggest a wage penalty for non-union black nurses compared to non-union white nurses as well as the absence of a racial wage differential for union nurses.     

Causes of the Long Stagnation of Japan during the 1990s: Financial or Real?

Corporate investment is the most important factor to explain the long stagnation of Japan during the 1990s. Using the Bank of Japan diffusion indices of “real profitability” and “banks' willingness to lend,” we estimate investment functions for four groups of firms: large/small and manufacturing/non-manufacturing. Our results suggest that for large firms, financing constraints are not significant whereas the converse is true for small firms. A fall of investment during 1992–94 is largely explained by real factors. However, the credit crunch occurred beginning 1997 and it lowered the growth rate of GDP by 1.6%. J. Japan. Int. Econ., September 1999, 13,(3), pp. 181–200. Faculty of Economics, Nagasaki University, 4-2-1 Katafuchi, Nagasaki 850-8506, Japan; and Faculty of Economics, University of Tokyo, 7-3-1 Hongo, Bunkyo-ku, Tokyo 113-0033, Japan. Copyright 1999 Academic Press.Journal of Economic Literature Classification Numbers: E22, E30, G21, N15.     

Changes by the Magic of Football

Football provides Jinan people with an additional topic and pride. The magic of football makes Jinan people younger and more vigorous.On the evening of May13th,2006,the Shandong Provincial Sports Center pitch a CSL(China Su-per League)match between Luneng Taishan andDalian Shide,which has been called the“NationalDerby”,a crowd of nearly fifty thousand came tothe match--a goalless draw.Swarming into thestadium filling every possible seat and cheering,they created a special scene that …     

Is Bigger Still Better? The Decline of the Wage Premium at Large Firms

This study shows that the wage premium paid by large firms fell over the past 20 years and that this decline in the size premium is most pronounced among the least educated workers. Empirical evidence supports several explanations for the shrinking size premium. First, there has been a convergence in the returns to worker characteristics at large and small firms over time. Second, small and large firms are hiring more workers with similar characteristics. Particularly important are the declining share of workers at large manufacturing firms and the rising share of workers at large retail firms. Also, the greater decline of unionism at large firms has contributed significantly to the decline in the size premium.     

Did International Outsourcing Cause the Increase in China's Skill Premium?

This study analyzes the transmission mechanism for the increase in the skill premium caused by international outsourcing through skill‐biased technological change (SBTC). Using 2000–2013 panel data from 27 manufacturing industries in China, this study conducts both probit and Tobit tests and shows that international outsourcing led to SBTC in China's manufacturing industries. A positive correlation is found between international outsourcing and the increase in the skill premium in both static and dynamic models. For each 1‐percent increase in the international outsourcing index, the skill premium will rise approximately 10 percent. This finding indicates the existence of a mechanism through which the effect of international outsourcing on the skill premium is reinforced where SBTC is occurring. However, this may enlarge wage gaps within the same industry. Therefore, China should not only use the skill premium to promote the transformation and upgrading of industries benefiting from outsourcing and optimize the structure of employment but also prevent the negative effects of an increased skill premium.     

When is Lift-Off? Evaluating Forward Guidance from the Shadow

We examine the record of the CD Howe’s shadow Monetary Policy Council (SMPC) in Canada. We report a considerable diversity of opinion about the recommended future path of interest rates inside the SMPC. During the period of Bank of Canada forward guidance, market determined forward rates diverge considerably from the recommendations implied by the SMPC. Nevertheless, there is little evidence that the Bank of Canada and the SMPC coordinate their future views about the interest rate path. Finally, changes in views about future changes in policy rates for horizons beyond the next two interest rate decisions are difficult to explain. Our findings imply that there remain challenges in understanding the evolution of future interest rate paths over time. We conclude with some policy implications.     

Maquiladoras: Exploitation or Emancipation? An Overview of the Situation of Maquiladora Workers in Honduras

Are offshore assembly workers being exploited or emancipated? The answer depends largely on what factors are being considered and with whom the workers are being compared. This paper presents data on 12 indicators, including both economic and social factors, which together provide an overview of the situation of maquiladora workers in Honduras. Second, it uses an alternative control group, first time applicants to the maquiladoras. Finally, this paper presents data collected in Honduras in 1998—providing insights into the industry as it is operating post-NAFTA and in a non-Mexican setting.     

Are the Bailouts of Wall Street Complements or Substitutes?

The Term Securities Lending Facility (TSLF) lent $2.3 trillion worth of general collateral to 18 investment houses in exchange for riskier securities. Treasury collateral was in high demand in 2008 and 2009 as repo markets shunned lower quality collateral. This paper finds a negative and significant relationship between participating in the TSLF and having funds from the Troubled Asset Relief Program (TARP) and other Federal Reserve lending programs. Thus, it appears that the TSLF was a substitute for other bailouts. In addition, dealers with higher paid CEOs were more likely to borrow in the next TSLF auction cycle.     

Rural poverty in the Eastern Cape Province: Legacy of apartheid or consequence of contemporary segregationism?

Poverty in South Africa in general has not declined since 1994, and it is particularly severe in the former Bantustans. This paper discusses two important issues related to rural poverty in the Eastern Cape Province. It questions the applicability of the notion of legacy to explain recent trends in rural poverty and constructs an argument that explains these trends in relation to post-1994 segregationism. It argues that the notion of legacy is not useful in explaining why rural poverty remains entrenched, long after 1994. Rural poverty today cannot be explained as something left behind after the end of apartheid, because its causes and drivers are the same now in 2012 as they were in 1970. The continuity between the pre- and post-1994 periods is best described by exploring and understanding post-1994 policy decisions and power configurations as an expression of contemporary segregationism.     

China: Workshop of the world?

Because China's transformation process is complex and remains open-ended, there are many partial answers provided to the many questions asked by foreign observers and Chinese people alike about where China is heading. The argument here is that it is wrong to assert China's coming collapse, just as it is not correct to assert that the dynamics so visibly at work in China will lead to China becoming the world's workshop. It is closer to the truth to maintain that the dynamics at work in China can lead in any direction, and that the necessary, let alone the sufficient conditions for them leading to a desirable outcome are daunting, but not impossible to achieve. This article suggests both necessary and sufficient conditions for China to emerge as the world's workshop, and then looks forward to assess whether we may expect regime change or political development.     

Canada and the IMF: Trailblazer or Prodigal Son?

Canada played an important role in the establishment of the IMF, yet in 1950 it was also the first major member to abandon the Bretton Woods par-value system in favour of a flexible exchange rate. Canada’s trail-blazing experience demonstrated that a flexible exchange rate can operate in stable and effective manner under a high degree of capital mobility. Equally important, it showed that monetary policy needs to be conducted differently under a flexible exchange rate and capital mobility. In 1962, Canada returned to the Bretton Woods system as a “prodigal son”, after a period of controversial monetary policy. This paper critically analyzes the interaction between Canadian and IMF officials regarding Canada’s exchange rate policy in view of the economic circumstances and the prevailing wisdom at the time. It also examines the impact on IMF research and policy because the Canadian experience influenced the work of Robert Mundell and Marcus Fleming, resulting in the development of the Mundell-Fleming model. Thus, the Canadian floating rate experience not only had important implications for the IMF and the Bretton Woods system, but also for macroeconomic theory and policy in open economies.     

The China money puzzle: will devaluation of the yuan help or hurt the Hong Kong dollar?

A Chinese yuan devaluation could affect the stability of the Hong Kong dollar. This paper studies two linkages. The first is that trade balance effect is studied through a computable general equilibrium (CGE) model. The result shows that the net change in Hong Kong's foreign reserve after a yuan devaluation is, in fact, negligible. The second is that psychological effect is studied by a survey of financial market participants. In spite of the small trade balance effect, all respondents believe that a yuan devaluation would lead to a panic selling of Hong Kong assets. Therefore, a yuan devaluation is bad for the Hong Kong dollar primarily through market psychology.     

Promoting or preventing labor migration? Revisiting the role of language

Large migration inflows increase the linguistic and cultural diversity of the place of destination, which facilitates the universal interchange of ideas and contributes to economic growth. However, the impact of language on migration is under-researched in developing countries. In this paper, we address this question in the context of China based on micro-level data and find a robust inverted U-shaped relationship between the probability of migration and the dialect distance between one's place of origin and the destination. Our identification strategy carefully addressed the selection bias and investigated different channels through which language affects the decision to migrate through imposing communication barriers, establishing social identity, and enhancing the exchange of skills. The results suggest that migration costs are mainly due to the difficulties of social integration, and the communication costs are small because of the wide use of standard Putonghua in China. In contrast, the benefits of migration increase when individuals move to a more linguistically distant place.     

Changes in Competitive Behavior of Foreign-invested Enterprises: A Case Study of the Chinese Detergent Industry

China began absorbing FDI towards the end of the 1970s. By the end of 2002, China had approved the establishment of 424,196 foreign-invested enterprises, involving a total contractual volume of US$ 828.06 billion, 447.966 billion of which were put into actual use.The probability of transnational corporations monopolizing the market of a host country and their important position in certain industries in China have prompted many to ask: Will transnational corporations     

Structural Restriction in the Development of Chinas Financial Industry

I. IntroductionSince reform and opening up, the most significant achievements in the development of Chinasfinancial industry are manifested in quantitative growth, that is, rapid growth of the totalfinancial assets, and rapid scale expansion of the financial industry. Behind the gratifyingquantitative growth are hidden worrisome structural problems. Developing countries are inthe take-off stage in the development of their economy and finance, and it is the general rulethat quantitative expans…     

Two Orthogonal Continents? Testing a Two-country DSGE Model of the US and the EU Using Indirect Inference

We examine a two country model of the EU and the US. Each has a small sector of the labour and product markets in which there is wage/price rigidity, but otherwise enjoys flexible wages and prices with a one quarter information lag. Using a VAR to represent the data, we find the model as a whole is rejected. However it is accepted for real variables, output and the real exchange rate, suggesting mis-specification lies in monetary relationships. The model highlights a lack of spillovers between the US and the EU.     

The Contribution of Childcare to Local Employment: Poor Work or Work for the Poor?

In recent years local economic development and regeneration agencies have begun to examine how locally based childcare can contribute to economic and social regeneration. This paper is based on current research by the authors and reports on the expectations and current realities of community based childcare as part of an economic regeneration strategy. It suggests that whilst the incorporation of childcare into urban regeneration strategy holds the potential to reduce the barriers to labour market involvement by mothers in low income households, less positive effects are also identifiable. Early evaluation is used to show that the commodification of care within urban regeneration policies reinforces care work as low paid, insecure gendered employment. It concludes by arguing that a more critical evaluation of both the economic and social impact of childcare on area regeneration is necessary.