IDEAS home Printed from https://ideas.repec.org/p/uts/ecowps/2.html
   My bibliography  Save this paper

Non-traded Factor Appreciation in China

Author

Abstract

The departure of a factor in excess supply in the non-traded sector leads to a real appreciation, in a setup that combines the canonical Lewis Model (Lewis, 1954, and Fei and Ranis, 1961, 1964) with a Balassa-Samuelson traded/non-traded dichotomy (Obstfeld and Rogoff, 1996). China is a potential candidate for non-traded factor appreciation, since it has not completed its structural transformation. A transfer of rural labor to urban areas will appreciate the real exchange rate.

Suggested Citation

  • Gordon Menzies & Xiaolin Xiao, 2012. "Non-traded Factor Appreciation in China," Working Paper Series 2, Economics Discipline Group, UTS Business School, University of Technology, Sydney.
  • Handle: RePEc:uts:ecowps:2
    as

    Download full text from publisher

    File URL: http://www.uts.edu.au/sites/default/files/edg_wp2.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kam Wing Chan, 2010. "The Household Registration System and Migrant Labor in China: Notes on a Debate," Population and Development Review, The Population Council, Inc., vol. 36(2), pages 357-364, June.
    2. Bela Balassa, 1964. "The Purchasing-Power Parity Doctrine: A Reappraisal," Journal of Political Economy, University of Chicago Press, vol. 72, pages 584-584.
    3. Bagnai, Alberto, 2009. "The role of China in global external imbalances: Some further evidence," China Economic Review, Elsevier, vol. 20(3), pages 508-526, September.
    4. Fang Cai & Meiyan Wang, 2008. "A Counterfactual Analysis on Unlimited Surplus Labor in Rural China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 16(1), pages 51-65, January.
    5. CAI, Fang & DU, Yang, 2011. "Wage increases, wage convergence, and the Lewis turning point in China," China Economic Review, Elsevier, vol. 22(4), pages 601-610.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Shang-Jin Wei & Zhuan Xie & Xiaobo Zhang, 2017. "From "Made in China" to "Innovated in China": Necessity, Prospect, and Challenges," Journal of Economic Perspectives, American Economic Association, vol. 31(1), pages 49-70, Winter.
    2. Menzies, Gordon & Xiao, Sylvia Xiaolin & Dixon, Peter & Peng, Xiujian & Rimmer, Maureen, 2016. "Rural-led exchange rate appreciation in China," China Economic Review, Elsevier, vol. 39(C), pages 15-30.
    3. Chen, Qin & Song, Zheng, 2014. "Accounting for China's urbanization," China Economic Review, Elsevier, vol. 30(C), pages 485-494.
    4. Imai, Hiroyuki, 2018. "China’s rapid growth and real exchange rate appreciation: Measuring the Balassa-Samuelson effect," Journal of Asian Economics, Elsevier, vol. 54(C), pages 39-52.
    5. Xiaobing Wang & Nick Weaver, 2013. "Surplus labour and Lewis turning points in China," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 11(1), pages 1-12, February.
    6. Takatoshi Ito & Peter Isard & Steven Symansky, 1999. "Economic Growth and Real Exchange Rate: An Overview of the Balassa-Samuelson Hypothesis in Asia," NBER Chapters, in: Changes in Exchange Rates in Rapidly Developing Countries: Theory, Practice, and Policy Issues, pages 109-132, National Bureau of Economic Research, Inc.
    7. Couharde, Cécile & Delatte, Anne-Laure & Grekou, Carl & Mignon, Valérie & Morvillier, Florian, 2020. "Measuring the Balassa-Samuelson effect: A guidance note on the RPROD database," International Economics, Elsevier, vol. 161(C), pages 237-247.
    8. Scott Rozelle & Yiran Xia & Dimitris Friesen & Bronson Vanderjack & Nourya Cohen, 2020. "Moving Beyond Lewis: Employment and Wage Trends in China’s High- and Low-Skilled Industries and the Emergence of an Era of Polarization," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 62(4), pages 555-589, December.
    9. Vlatka Bilas & Mile Bosnjak, 2015. "Revealed Comparative Advantage And Merchandise Exports: The Case Of Merchandise Trade Between Croatia And The Rest Of The European Union Member Countries," Economic Thought and Practice, Department of Economics and Business, University of Dubrovnik, vol. 24(1), pages 29-47, june.
    10. Ken Miyajima, 2013. "Foreign exchange intervention and expectation in emerging economies," BIS Working Papers 414, Bank for International Settlements.
    11. Heng, Dyna, 2011. "Capital flows and real exchange rate: does financial development matter?," MPRA Paper 48553, University Library of Munich, Germany, revised May 2012.
    12. Yinhua Mai & Xiujian Peng & Peter Dixon & Maureen Rimmer, 2014. "The economic effects of facilitating the flow of rural workers to urban employment in China," Papers in Regional Science, Wiley Blackwell, vol. 93(3), pages 619-642, August.
    13. Sergio Da Silva & Guilherme Moura & Sidney Caetano, 2004. "Big Mac parity, income, and trade," Economics Bulletin, AccessEcon, vol. 6(12), pages 1-8.
    14. Erdem Basci & Özgür Özel & Cagri Sarikaya, 2008. "The monetary transmission mechanism in Turkey: new developments," BIS Papers chapters, in: Bank for International Settlements (ed.), Transmission mechanisms for monetary policy in emerging market economies, volume 35, pages 475-499, Bank for International Settlements.
    15. Sun, Nan & Yang, Fan, 2021. "Impacts of internal migration experience on health among middle-aged and older adults—Evidence from China," Social Science & Medicine, Elsevier, vol. 284(C).
    16. Bofinger, Peter & Wollmershauser, Timo, 2001. "Is there a third way to EMU for the EU accession countries?," Economic Systems, Elsevier, vol. 25(3), pages 253-274, September.
    17. Efraim Sadka & Assaf Razin, 1996. "Fiscal Balance During Inflation, Disinflation, and Immigration: Policy Lessons," IMF Working Papers 1996/033, International Monetary Fund.
    18. Muntasir Murshed & Seemran Rashid, 2020. "An Empirical Investigation of Real Exchange Rate Responses to Foreign Currency Inflows: Revisiting the Dutch Disease Phenomenon in South Asia," The Economics and Finance Letters, Conscientia Beam, vol. 7(1), pages 23-46.
    19. Barbara Rossi, 2013. "Exchange Rate Predictability," Journal of Economic Literature, American Economic Association, vol. 51(4), pages 1063-1119, December.
    20. Pau Rabanal, 2009. "Inflation Differentials between Spain and the EMU: A DSGE Perspective," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 41(6), pages 1141-1166, September.

    More about this item

    Keywords

    Non-traded factor appreciation; Lewis Dual-economy; China;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:uts:ecowps:2. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/edutsau.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Duncan Ford (email available below). General contact details of provider: https://edirc.repec.org/data/edutsau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.