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Industry/Policy View Derisking Real Estate in China’s Hybrid Economy

Wei Xiong, Jun 28, 2023

We investigate the relationship between the allocation of government subsidies and total factor productivity for Chinese listed firms.

The Collateral Channel of Monetary Policy: Evidence from China

Hanming Fang, Yongqin Wang, Xian Wu, May 13, 2020

As a quasi-natural experiment to estimate the causal impact of the collateral-based unconventional monetary policy, we exploit the expansion of the collateral for the Medium-Term Lending Facility (MLF) in the interbank bond market on June 1, 2018 by the People’s Bank of China. We also consider that many bonds are dual-listed in a largely segmented exchange market. We find that the policy reduced the spreads of the newly collateralizable, dual-listed bonds in the treatment...

Optimising Production: Industrial Policies in Networks

Ernest Liu, Mar 13, 2019

Many developing countries adopt industrial policies favoring upstream sectors. Liu (2018) shows these policies might enhance aggregate production efficiency. When sectors form a production network, market imperfections generate distortions that compound through input demand linkages, accumulating into upstream sectors and creating an incentive for...

The Impact of the China Tire Safeguard

Sunghoon Chung, Joonhyung Lee, Oct 23, 2019

This column evaluates the impact of the China tire safeguard on the US tire industry. Contrary to claims made by the US government, we find that total employment and average wages in the tire industry were unaffected by the safeguard. This result is not surprising as we find that Chinese tires have been completely diverted to other exporting countries due to the strong presence of multinational corporations in the world tire market. On the other hand, US domestic tire prices increased by up to 10% during the safeguard period...

The Demand for Reverse Mortgages in China

Katja Hanewald, Hazel Bateman, Hanming Fang, Shang Wu, May 15, 2019

Reverse mortgages are financial products that allow older homeowners to live in their property and receive income for as long as they live; repayment is made from the proceeds of the property sales upon the homeowners’ death. A recent pilot program in China by Happy Life Insurance found almost no takeup of such products. We investigate whether, if reverse...