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FEC Articles Express: 2016 December Issue
February 13, 2017
Frontiers of Economics in China (FEC)

Volume 11, Issue 4, December 2016 (Free Full-Text Download)

Steven Globerman
A Policy Perspective on Outward Foreign Direct Investment by Chinese State-Owned Enterprises

Örn B. Bodvarsson, Jack W. Hou, Kailing Shen
Aging and Migration: Micro and Macro Evidence from China

Chorching Goh, Wei Li, Lixin Colin Xu
R&D Returns, Spillovers and Firm Incentives: Evidence from China

Matthieu Clément
Income Mobility and Income Inequality in Rural China

Yu You, Yoonbai Kin, Zongye Huang
Exchange Rate Flexibility and Current Account Adjustment: A Threshold VAR Analysis

Yafang Yu
Testing Commitment Models of Monetary Policy in China

Mengnan Zhu, Qian Zhao, Yuguang Wang
The Political Cause of the Movement of RMB Exchange Rate:A Research Based on the Spillover Effects of US Political Cycle

A Policy Perspective on Outward Foreign Direct Investment by
Chinese State-Owned Enterprises

Steven Globerman
Kaiser Professor of International Business
Western Washington University
College of Business and Economics
Senior Fellow
The Fraser Institute

Abstract: A growing number of developed country governments in recent years have adopted a hostile attitude towards foreign direct investments undertaken in their markets by state-owned enterprises, the latter often based in China. The broad reason for this hostility is the belief that SOEs pursue non-commercial objectives with resulting damage to host economies. This paper argues that the empirical evidence shows SOEs are increasingly exhibiting market-owned behavior. Furthermore, any adverse consequences of non-commercial behavior are likely to be realized primarily by the SOEs themselves.

Aging and Migration: Micro and Macro Evidence from China
Örn B. Bodvarsson, California State University, Sacramento
Jack W. Hou, California State University-Long Beach & Henan University
Kailing Shen, Xiamen University & Australian National University

Abstract: Post-reform China has been experiencing two major demographic changes: an increasingly aging population and an extraordinary surge of rural-urban migrants. The question we ask is: are these two demographic changes related? If yes, then, how? The standard view in the migration literature is that the older the migrant, the lower the likelihood of migration. This paper proposes a simple theory of temporary migration for unskilled labor to fit the context of China. Motivated by our model, we then use both cross-sectional micro data and panel macro data to examine the potential impacts of aging on migration. We find that shifts in China’s age distribution have generated significant changes in the country’s migration patterns: migration will shift to closer provinces (probably switching from interprovincial migration to intra-provincial migration) and will concentrate to a few destination provinces.

R&D Returns, Spillovers and Firm Incentives: Evidence from China

Chorching Goh, World Bank
Wei Li, Cheung Kong Graduate School of Business
Lixin Colin Xu, World Bank

Abstract: Using a new data set of 12,000 firms in China, this paper estimates the returns to R&D investment and its spillover effects, and investigates how the returns to R&D depend on firm incentives. For the firms in the sample, the results show that on average firm output increases around 0.4 yuan for each additional 1 yuan spent on R&D in the previous year, and there is high R&D return regardless of whether the endogeneity of R&D intensity is dealt with or not. Interestingly, the marginal return to R&D is significantly higher in firms whose CEOs were not appointed by the government, and lower when CEO pay is directly related to annual performance. The return to R&D is higher in relatively poor regions and for firms with worse access to finance. There are also non-trivial R&D spillover effects.

Frontiers of Economics in China (FEC) is a quarterly peer-reviewed journal edited by Institute for Advanced Research, Shanghai University of Finance and Economics, and published by Higher Education Press. Established in 2006 and with Guoqiang Tian as the Editor, the journal has a strong Editorial Advisory Board (with several Nobel Prize winners as board members), as well as a dedicated Co-Editors’ team and an Editorial Board comprised of leading overseas and domestic Chinese economists.

The FEC welcomes submissions of theoretical and empirical papers from all fields of economics, particularly those with an emphasis on the Chinese economy and other emerging, developing or transition economies.  Indexed in more than 10 international databases including EconLit, Google, RePEc and SCOPUS, the journal is listed into "2016 The Highest International Impact Academic Journals of China (Humanities and Social Sciences)".  Full-text papers are free for download at:

Editor: Guoqiang Tian, Texas A&M University; Shanghai University of Finance and Economics
Executive Editor: Zhiqi Chen, Carleton University
Chunrong Ai, University of Florida
Kevin X.D. Huang, Vanderbilt University
Neng Wang, Columbia University
James Wen, Trinity College, USA

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