期刊目录 | 财经战略研究院

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China Finance and Economic Review

Volume 6 Number 3 Autumn 2017

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Content

Fiscal pressure and local economic growth

——An experiment from China income tax sharing system reform (P.3)

Chen Sixia(Zhongnan University of Economics and Law)

Xu Wenli (Wuhan University)

Zhang Lingyi(Zhongnan University of Economics and Law)

ABSTRACT：In this paper,we construct an “as-if” DID model on the basis of the 2002 “Income Tax SharingSystem” reform and evaluate the changes in local fiscal pressure based on anexogenous shock that redefines the tax sharing rules between the centralgovernment and local governments. By using the DMSP/OLS satellite data at thecity-level, we empirically examine the impact of fiscal pressure on theeconomic growth. We find that fiscal pressure significantly increase thesatellite lighting. Furthermore, we obtain the findings as follows. Firstly,the incentive effects of fiscal pressure effects are less profound in citiesthat receive considerable intergovernmental transfers from high levels ofgovernments. Secondly, the local governments are more likely to help the growthof real estate industry, which can reciprocally bring them considerable salestaxation. However, this homogenized growth pattern might be detrimental foreconomic diversification and finally enhance the risk of economicalfluctuation. Finally, the fiscal pressure created by the reform restricts theextent to which jurisdictions compete with each other. However, the taxcompetition still exists because local governments are able to lower the taxrate once they gain enough revenues from land-sales. This paper provides a newexplanation for China’s high-speed growth in addition to expendituredecentralization or administration decentralization. It also offers extraevidence for exploring the growth incentives of local government within theframework of China’s decentralization.

Keywords:fiscal pressure, DMSP/OLS satellite data, income tax sharing reform, difference-in-difference

Assessing China's recent capital outflows:Policy challenges and implications (P.28)

Sarah Chan Siaw Fume (National University of Singapore)

ABSTRACT：China has experienced a dramatic swing from net capital inflows to large net outflowsin recent years. The recent capital exodus to some extent reflects policydifficulties and obstacles that China’s authorities face in managing economicreforms. In particular, China faces tough challenges in balancing thebenefit/risk trade-off from capital account opening and attempting to introducemore flexibility to the currency. Moreover, the lack of policy clarityhighlights policy inconsistencies and ambiguities among Chinese leaders inmacroeconomic management, as more often than not, government policies seem toalternate between emphasizing reform and growth. This may cast doubt on theChinese leadership’s commitment to reform, undermine confidence in the economyand cause further capital outflows that will have significant repercussionsboth for China as well as for the world.

Keywords: capital outflows, Renminbi, capital account, foreign exchange reserves

The effect of equity structure and influence factors on China's banking cyclical behavior and monetary policy (P.42)

Crentsil Kofi Agyekum (Beijing University of Technology)

ABSTRACT：Severalyears ago, there were crises on mortgage resulted in a serious thread onfinancial systems in the United States and other developed and developingcountries. However, some scholars are of the view that the procyclical natureof the bank lead to this serious incident. In this study, we focus on China’sbank lending behavior whether it falls within the cyclicality of the bankingpractices. The study realizes that credit distributions are still themanagerial way of for transferring government monetary policy. It is nothowever the actual reasons behind the China’s bank counter-cyclical lending.State-owned financial firms within higher ownership are of no doubt of likelyto be counter cyclical. Some school of thought are with the view that comparedto developed countries, state-owned banks play a major decisions in otherdeveloping countries such as Brazil, and they believe that the wellperformances of this nations are adhering to the financial crises that arehighly related to the state-owned banks. For example in China, commercial banksare the main embodiment of China’s financial institutions. It is believed thatmost of these banks have very strong support by the central government and thatmakes clientspay more attention to their well-being thus implementing thestates macroeconomic policies and resisting the financial crises. The studybased on other existing researches will take the government monetary policy andcommercial banks equity structure into a frame work and under search how theyinfluence the cyclical China’s commercial bank lending behavior and projectother possible effects for regulatory bodies to take it into account whenmaking a decision.

Keywords: monetary policy,shareholder structure, lending behavior, counter-cyclicality

Chinese decentralization and income inequality between urban and rural residents

——An empirical study based on the dual dimensions of internal and external budget (P.62)

Chu Deyin (Anhui University of Finance and Economics)

Han Yiduo (Anhui University of Finance and Economics)

Zhang Jinghua (National Tax Institute of StateAdministration of Taxation)

ABSTRACT：The paper firstly explains the mechanismof decentralization on income inequality from two theoretical dimensions ofinternal and external budget. Based on the re-measurement of income Ginicoefficient and Chinese decentralization level, this paper establishes paneldata model from national and regional perspective to empirically investigatethe impact of Chinese decentralization on income inequality between urban andrural residents. Firstly, the promotion of budgetary income decentralization isconductive to reduce income inequality of urban and rural residents whether itis from the national or sub regional. Second, although the promotion ofbudgetary expenditure decentralization exacerbates the urban-rural incomeinequality in the national level, it could obviously reduce the urban-ruralincome inequality in the midwest with relatively low level of budgetaryexpenditure decentralization. Thirdly, the impact of extra-budgetarydecentralization on income inequality is consistent, no matter in the wholecountry, in eastern or in western regions. This means that the extra-budgetaryincome decentralization makes the income inequality between urban and rural residentsworse while the extra-budgetary expenditure decentralization reduces the incomeinequality between urban and rural residents with different degrees. Fourthly,the transfer payment, years of schooling and urban unemployment rate areconductive to narrow the income inequality between urban and rural residentswhile the impacts of economic development, urbanization and opening degree areobviously different in different regions. The above conclusions can not only beused for reference to further perfecting and reshaping the fair efficiencymechanism of Chinese decentralization, but also indicates the direction of thenew fiscal and tax system reform.

Keywords:Chinese decentralization, budgetary and extra-budgetary, income inequality between urban and rural residents, panel data model

Measures and underlying mechanisms of inequality of opportunities in China: Evidence from CGSS data (P.88)

Song Yang (Renmin University of China)

ABSTRACT：This paper utilizes the latest CGSS datato quantitatively measure the contributionof inequality of opportunities to theoverall income inequality in China. It findsthat 27% of total income inequalitycan be attributed to inequality of opportunities,i.e., the inequality componentwhich is out of control for individuals. This ratiois comparable to that foundin most Latin American countries with high incomeinequality. The heterogeneityanalyses show that the inequality of opportunitiesis even larger forlow-educated and low-income groups. Furthermore, the paperempirically verifiesthree possible channels underlying the measured inequality ofopportunities,including labor market discrimination, intergenerational educationpersistence,and family background effect. Policy suggestions are derived basedon theempirical analyses, such as reducing labor market discrimination,balancingeducation resources among different areas, making it more transparentin state sectorrecruitment, and lowering inequality by more progressive taxesand transfers.

Keywords:inequality of opportunities, labor market discrimination, intergenerational education persistence, family background

Board independence and fluctuations of corporate performance

——A research from the angle of social relations of independent directors (P.128)

Liu Cheng (National Academy of Economic Strategy,CASS)

ABSTRACT：Based on whether there is socialrelation between independent directors and CEOs,there are two types ofindependence in the board of directors: nominal independenceand realindependence. Their influences on the fluctuations of corporate performancearevaried. First, the board independence will strengthen supervision and reducethefluctuations in corporate performance. Second, the nominal boardindependencewill reduce performance fluctuations but with inadequatesignificance; however,the real independence significantly reduces fluctuationsof corporate performance;social relations between CEO and independent directorswill encourage fluctuationsof corporate performance. This also confirms thatthe independent directors canreduce the corporate performance instead of justholding the post and doing nothing.At the same time, in order to improve thereal board independence, when recruitingindependent directors, those graydirectors who have social relations with CEO mustbe identified and excluded.

Keywords:social relations, nominal board independence, real board independence,performance fluctuations

欢迎投稿：cfer@cass.org.cn

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China Finance and Economic Review（Vol.6, No.3,Autumn 2017)