Abstrat:Regarding the new pattern of capital flows i.e., large Non-FDI inflows to China, the paper analyses the mechanism through which international capital movements are translated into macroeconomic instability and the limitations of police responses such as sterilization and capital control. The key of the paper is to introduce economic distortions, and set up the model of capital flows and macroeconomic stability with distortion factor as well as claim that the distortions would reinforce the volatility resulting from the capital flows. Therefore, in order to manage the new pattern of capital flows, policy authorities should improve the supervisory system on Non-FDI, adjust the economic distortions and bring the transition from ‘quantities’ to ‘prices’ macro-regulation.

Abstrat:In a political economy framework, this paper studies the effect of income inequality on growth when government spending enters production function and utility function at the same time. Our model shows that there is an inverted U-shaped relation between growth and taxation and income inequality when economy and polity reach equilibrium.

Abstrat:Many Economists tend to believe that inflation will increase or decrease if growth is higher or lower than the “potential" growth rate of the economy. The traditional wisdom of explaining these phenomena is to use the “Phillips Curve" which emphasizes the labor market condition. Contrast to the traditional method, this study investigates the relationship between inflation and growth focusing on goods market directly. We set up a simple theoretical model and estimate equations relating the change in inflation to growth rates of economy. Our result suggests that the “steady inflation rates of economic growth" is 9.8% about in China.

Abstrat:This paper employs the so called behavioral equilibrium exchange rate model to estimate the equilibrium real exchange rate of Renminbi and the exchange rate misalignment in China, which covers the period from 1991q1 to 2004q3. The main findings of the paper are that 1 since 1994q4, Renminbi equilibrium exchange rate has exhibited a steady appreciation, the main moving forces behind that are the fast productivity growth within the manufacture sector and the rapidly enlarged net foreign asset position; and 2 that Renminbi real exchange rate has been misaligned during most of the sample period, particularly, undervaluation occurred in 1992q2—1994q4 period, overvaluation occurred in 1995q1—1999q2, and undervaluation has occurred again since 1999q3, which also has an enlarging trend since 2002q2. The paper also analyses the economic reasons and policy implications of the findings.

Abstrat:Downward compatibility is one of the salient characteristics of human capital, that is the human capital with higher level can do work that the low-level human capital does but not the vice-versa. In the paper, we incorporate the idea of downward compatibility into the aggregation of human capital and generalize the traditional aggregation approach. By using the measurement of aggregate human capital obtained in this paper, we do the cross-country income level accounting and find that human capital and physical capital is the major source of cross-country income difference, which is contrary to the conclusion of Klenow and Rodriguez-Clare 1997, Hall and Jones 1999, as well as other recent studies. The contribution of this paper is two-folded. On the one hand, we put forward a more general approach to aggregate the human capital. On the other, we resuscitate the conclusion of Mankiw, Romer and Weil 1992 and prevent it from the criticism of Klenow and Rodriguez 1997 and subsequent studies. Thus the paper strongly supports the “neo-classical revival”.

Abstrat:The orthodox consumption theories dont incorporate OLG model and wealth-stock model,whereas from viewpoints of social convention, moral formation, ethics and other informal institutions, this article explains the households characters in consumptions and savings in some countries and regions such as China. We shall exploit and extend the overlapping-generations model, allow the bequest,gift and wealth preference simultaneously to enter into the representative agents utility function, then apply optimal first order conditions to analyzing the characters and problems concerning consumptions and savings behavior. Furthermore, we state the effects of the analysis on the government macroeconomic policies.We present some relevant theoretical thinkings and solutions.

Abstrat:This paper extends the model of Stein1992in order to study how the firms of different profitable abilities under the existence of private benefit of control choose their financing tools, including issuing bonds, equities and convertible bonds. The existence of private benefits of control motivates the “good” firms to issue convertible bonds financing, and the costless equilibrium in the Steins model is not the unique one. Firms issuing convertible bonds is the result of game equilibrium of the controlling shareholders of various firms and outside investors. The behavior of controlling shareholders pursuing the private benefit of control bring the market more uncertain factors, increase the agent cost of firms financing, and intensify the market volatility and speculative behavior. So it is necessary to control them.

Abstrat:This study empirically examined the relationship between related party transactions and the ownership structure of Chinese listed firms. As a result, we find that the monetary amount and likelihood of the related party transactions between the largest shareholders group and the listed company are positively correlated with the share proportion controlled by the largest shareholder. More importantly, our results show that increasing the number of controlling shareholders and decreasing the controlling gap between them will decrease the likelihood and extent of related party transactions. Our results imply that the reduction of state ownership is not the only way to improve corporate governance of the listed firms and to protect the interest of individual investors. In present stage, it might be a more feasible choice to transform the ownership structure from sole controlling shareholder to multiple controlling shareholders.

Abstrat:Although tunneling as well as propping addresses the problem of the ultimate owners incentive to form pyramidal structure, it couldnt sufficiently explain the reason why dispersed investors still have incentive to invest, given that they would be appropriated by the ultimate owner. In this paper, we think that the divergence between ROAs provides the main incentive to invest for dispersed investors. In a simple framework, this paper proves that since pyramidal structure is formed, the investors incentives to finance parent company of pyramidal structure come from not only the transferring effects of deduction of appropriation level, but also the growth effects of higher returns on assets of subsidiary firms. As for the investors who finance the subsidiary firms, the growth effects functions as the main incentive to invest. To explain the phenomena of prevalence of pyramidal structure in emerging markets completely depends on the integration of factors of both tunneling and the divergence of ROAs.

Abstrat:In this paper,a simplified mathematical model based on the behavioral pattern of firms in the PRC is used to discuss the impact of marketization and privatization on private sector development. The model demonstrates that private enterprises,SOEs,and other entities undergoing reform in the PRC are entities with multiple objectives. This pattern of behavior leads to firms that tend to use more capital and labor to produce more output compared with pure profit-maximizing firms,but to earn fewer profits or to even register losses. The impacts of firms non-profit objectives and the “costs of entry” on the size and number of firms are also discussed. The problem of matching between managerial ability and firm size is introduced to explain why gradual reform in PRC has succeeded,whereas the “Big Bang” in Russia failed.

Abstrat:According to the reality of the intermediate capital flight which occurs in China recent years, this paper established a model between the government and the domestically-funded enterprises on the foundation of the discrimination treatment to the foreign-funded and the domestically-funded enterprises. We analyzed how the discrimination treatment caused the intermediate capital flight; how the capital control influenced the intermediate capital flight; why the government gave the foreign-funded enterprises vast special treatments in initial periods of Chinas reform and open policy. The paper also pointed out that considering the domestic investment quantity is increasing, the government should reduce the discriminate of the taxations rate. Furthermore, We analyzed how the asymmetry information, which means the government didnt know the enterprises cost of intermediate capital flight, influenced the optimal taxations discrimination. Finally, the paper concluded that the unification of the taxations rate of domestically-funded and foreign-funded enterprises in China was the direction of the reform.

Abstrat:The amount and proportion,research topics and applied targets,data type and sources,model structure and estimating methods of applied econometrical papers in Economic Research Journal from 1979 to 2004 are statistically analyzed in this paper,which is also compared with five more economic journals such as Journal of Quantitative & Technical Economicsand Management World. This paper summarizes three characteristics of Chinas applied econometrics developing path in the end.