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Joint Workshop on Socio-Economics

The 6th Annual Joint Workshop on Socio-Economics

New forms in China. Analysis and international comparison

Co-sponsored by Fudan University, University of Paris 1 and FERDI

Paris, 26 June 2014

Maison des Sciences Economiques 106-112 Blvd. De l’Hôpital 75013 Paris

  Room 17



9:00-11:50  Morning Session  Chair: Jean-Claude Berthélémy (Dean of the Department of Economics, University of Paris 1)

9:00-9:05  Welcome introduction by Prof. Jean-Claude Berthélémy

9:05-9:35 Inaugural session. Zhigang Yuan (Fudan University) “2014Transformation of China’s Growth Driving Forces”

   Discussant: Jean-Claude Berthélémy

9:35-10:35 Efficiency and control

Laurène Petitfour (CERDI, Université d’Auvergne, Clermont-Ferrand) with  Martine Audibert., Xiezhe Huangfu, Jacky Mathonnat “Estimating and explaining the efficiency of Chinese Township hospitals: DEA vs robust non-parametric frontiers”

Abstract. To cope with the rising price of drugs, in 2009 the Chinese government announced a large pharmaceutical reform. Its key element is the implementation of a National Essential Medicine List, leading to a reorientation of incentives for health services providers. Therefore, it is crucial to evaluate the efficiency of health facilities, and to understand its determinants.

Most of the literature around the determinants of efficiency of health facilities adopts a two-stage methodology, using the DEA method to estimate the efficiency scores, and a Tobit model to explain them. But the literature related to efficiency has enlightened the sensibility of DEA to dimensionality and outliers, and proposed more “robust” approaches, based on partial frontiers, known as order-m (Cazals et al., 2002) and order-α (Daouia andSimar, 2007).

Using survey data from a sample of 30 Township Hospitals in Weifang, Shandong, this study aims at comparing the results of those methods with “traditional” DEA, and introducing them in a second stage analysis, to identify the determinants of efficiency, in the specific context of township hospitals which are the first referral level in the Chinese health care system.

Discussant: Jin Feng

Shuo Chen (Department of Economics, Fudan University) “Accountability from Cyberspace? Online Scandals Exposure and Officials Governance in China”

Abstract: By studying online discourse about officials’ scandals, this paper examines the power of social media in China. We establish a unique dataset that contains all records with regard to scandals involving officials discussed on micro-blog in China from 2011 to 2012 and study their effects on the government disciplining. Our main findings include: First, officials involved in sex scandals usually receive more severe punishment without any delay; second, officials’ misconduct like improper talks and manners does not necessarily lead to punishment; third, there is no statistical evidence supporting the hypothesis that online exposure of corrupted officials leads to their punishment. These findings suggest that, compared with democratic regimes, online scandal exposure has different effects on the officials’ disciplining and more generally, the informal accountability has limited influences in authoritarian regimes.

Discussant: Ysaline Padieu

10:35-10:50       Coffee Break

10:50-11:50     Industrial economics

Philippe Gagnepain (Centre d’Economie de la Sorbonne) with Luis Aguiar “European Cooperative R&D and Firm Performance: Evidence Based on Funding Differences in Key Actions”

Abstract. The Framework programmes created by the European Union are the main financial tools used to support cooperative R&D activities in the EU. Unlike previous empirical studies, this paper suggests that their impact on firms’ competitiveness is significant. We analyze industry-oriented research joint ventures supported by the Fifth European Framework Programme between 1998 and 2002. A key feature of this Programme is that funding is available to the firm based on social and economic concerns instead of pure performance criteria, which guarantees that financial support is not granted on technological opportunities. This allows us to identify the causal effect of the program on firms’ performance using the funding available to the firms in their respective industries as a source of exogenous variation in the decision to participate in the programme. Our results suggest that participation in large research projects raises labor productivity by at least 35 percent and profit margin by up to 8 percentage points.

Discussant: Yongqin Wang

Yongqin Wang (Fudan University) with Julan Du and Kai Wang “Political Determinants of the Location Choice and Entry Mode of Chinese Outward FDI”

Abstract. This study investigates the effect of political factors on location choice and entry mode selection of outward FDI based on outward FDI transactions by Chinese firms in 209 countries around the world from 2002 to 2011. A firm that invests overseas encounters two problems. One is location choice, that is, the choice of the target country and target company. The other is entry mode strategy, which comprises the selection of sole owner or co-owner and the share proportion. Evidence indicates that political factors of a target country significantly influence the location choice of Chinese outward FDI. A substitution effect exists between the political and the tax factors to some small extent. Chinese firms tend to invest in countries that have a better institutional situation. In addition, evidence suggests that Chinese firms prefer M&A as entry mode in countries that have better political institutions and tend to have a high proportion of shares.

Discussant: Ping Hua

11:50-12:00       Group Photo

12:00-13:30       Lunch

13:30-17:00       Afternoon Session    Chair: Zhigang Yuan (Dean of the School of Economics, Fudan University)

13:30-15:00 International trade   

Shu Lin (Fudan University) with Jiandong Ju and Shang-Jin Wei “Evidence on the credit channel of monetary policy: Solving causality by using the impossible trinity”

Abstract. We combine the credit channel of monetary policy transmission literature and the credit constraints and trade literature to examine how monetary policy affects exports through a credit channel. We identify exogenous monetary policy changes in exporting countries based on the "impossible trinity" theorem and make efforts to isolate the effects of monetary policy through changes in the real exchange rate and foreign demand. In a large sector uni-directional trade dataset for the years 1970-2010 we find strong evidence supporting the credit channel transmission of monetary policy on exports. The export-reducing effect of an exogenous monetary tightening (e.g., a large increase in the interest rate) is significantly amplified by various measures of sector financial constraints. Our results are also quantitatively meaningful and robust to alternative samples, measures of monetary policy stances, and model specifications.

Discussant: Jean-Pierre Laffargue

Ping Hua (CERDI - UMR 6587, Université d'Auvergne, Ecole d'économie, CNRS) with Sylviane Guillaumont Jeanneney ”China’s African financial engagement, real exchange rates and trade between China and Africa”

Abstract.  In the last decade China’s trade with Africa increased faster than its overall foreign trade. This paper focuses on the role of real exchange rates in this growth. A “bilateral real exchange rate” augmented trade gravity model applied to China’s trade with 49 African countries over the period 2000 to 2011 shows that the real appreciation of most African currencies relative to the renminbi favoured China’s exports to these countries, but had no impact on China’s imports from Africa. This real appreciation of African currencies is explained by three factors: 1) the decision to peg them to other currencies (in particular to the euro), 2) the amount of export of raw materials from African countries, and 3) the amount of financial assistance from international donors including China. Thus, a kind of detrimental sequence exists in Africa’s relationship with China: China’s imports of raw materials and its economic cooperation are among the factors explaining the appreciation of African real exchange rates, which itself stimulates China’s exports of manufactured goods, and so restricts Africa’s own industrial development.   

Discussant: Shu Lin

Zhao Chen (China Centre for Economic Studies, Fudan University) with Sandra Poncet and   Ruixiang Xiong “Comparative Advantage and the Effects of Place-Based Policies: Evidence from China’s Export Processing Zones”

AbstractThis paper explores whether comparative advantage determines the effects of industrial policy, after matching China’s manufacturing firm level data from 1998 to 2007 with the key industries which were selected when the export processing zones were established. We find that, the export promoting policies of the export processing zones increase the export value of the firms by 10.4% on average. Further study shows that the effects are up to 12.4% for the industries with comparative advantage, while the effects are not statistically significant for the industries without comparative advantage. Long term results show that the effects of industrial policy increase year by year for the industries with comparative advantage, while the effects are not significant for the industries without comparative advantage. There are no significant differences in growth rates of export value between the key industries and non-key industries before the establishment of export processing zones, which mean that the governments are not picking the winners. What’s more, the findings are consistent for a lot of robustness checks. Discussant: Angelo Secchi

15:00-15:15       Coffee Break

15:15-16:45               Internal migrations

Thomas Vendryes (Centre d’Economie de la Sorbonne and ENS Cachan), with Marc Gurgand and Yue Ximing: “Internal Migration and Rural Development in China: A case Study Using the 2001 Hukou System Reform”.

Abstract. Internal rural-to-urban migration flowsows are a crucial dimension of the process of structural change that accompanies the dynamics of development. From this point of view, the People's Republic of China stands today as a very special case, as it manages to achieve very high rates of growth while maintaining tight controls on mobility through what is known as the hukou system. This institutional legacy of the collectivist and planned economy era has been regularly criticized for generating discrimination and leading to a sub-optimal allocation of resources. However, two critical questions remain unanswered: to what extent does the hukou system actually hinder migration? And does it affect rural development? With a panel data set covering around 16 000 rural households in four Chinese provinces over the period 2000-2004, this study uses a significant reform of the hukou system which took place in the early 2000s to provide, for the first time, rigorous micro-level evidence on these two issues.

    Discussant: Zhao Chen

Sylvie Démurger (CNRS, GATE Lyon Saint-Etienne), with Li Shi and Xu Hui: “Internal Migration, Family Living Arrangements and Happiness in China”.

Abstract. This paper explores the impact of institutional barriers imposed on internal migrants in China through the hukou system on their subjective well-being at destination by linking reported happiness to family living arrangements. Using the 2011 Dynamic Monitoring Survey of Migrant Population in Urban China, we find that constrained family living arrangements lower migrants’ happiness. In particular, migrant parents separated from their child are more likely to be unhappy. If institutional barriers were to be removed, we predict that the proportion of happier migrants would be increased by 13%, and the effect is greater for women than for men. We also find that rural migrants are more likely to be impacted by family living arrangements than urban migrants and that the effect is the highest for the middle-age group of migrants.

Discussant: Yongqin Wang        

Katrin Millock (Paris School of Economics, CNRS, Centre d’Economie de la Sorbonne), with Ingrid Dallmann: “Climate Variability and Internal Migration: A Test on Indian Inter-State Migration”.

Abstract. We match migration data from the Indian census with climate data to test the hypothesis of climate variability as a push factor for internal migration. The main contribution of the analysis is to introduce relevant meteorological indicators of climate variability, based on the standardized precipitation index. A structural estimation based on utility maximization reveals only weak evidence that climate variability has a direct effect on bilateral migration rates. When accounting also for the indirect effect through income, we find that drought frequency in the origin state acts as push factor on inter-state migration in India, and that drought magnitude has a smaller and statistically less significant effect. Drought duration and measures based on excess precipitation are never statistically significant. The results are robust to estimations limited to rural out-migration only. 

    Discussant: Shuo Chen

16:45-17:00               Closing Remarks

18:30       Opens external link in new windowDinner at Bouillon Racine


Each session lasts 90 minutes, with 25 minutes for the presentation of each paper, 10 minutes for each comment and 2*10 minutes for questions from the floor.