Header

UZH-Logo

Maintenance Infos

A provincial view of global imbalances: regional capital flows in China


Cudré, Samuel; Hoffmann, Mathias (2017). A provincial view of global imbalances: regional capital flows in China. Review of World Economics, 153(3):573-599.

Abstract

We model capital flows among Chinese provinces. A version of the present value model of the current account (PVMCA) with non-tradable goods and a savings wedge accounts for around 80% of the variation in inter-provincial capital flows over the 1986–2010 period. The PVMCA also allows us to identify the channels of external adjustment in capital flows at the province-level: variation in intertemporal prices (domestic and international interest rates, the provincial real exchange rate) and intertemporal variation in quantities (output, investment and government spending). We find that cross-province variation in the importance of these channels is correlated with the importance of private and state-owned enterprises and demographic factors. We discuss implications of our results for global imbalances in capital flows.

Abstract

We model capital flows among Chinese provinces. A version of the present value model of the current account (PVMCA) with non-tradable goods and a savings wedge accounts for around 80% of the variation in inter-provincial capital flows over the 1986–2010 period. The PVMCA also allows us to identify the channels of external adjustment in capital flows at the province-level: variation in intertemporal prices (domestic and international interest rates, the provincial real exchange rate) and intertemporal variation in quantities (output, investment and government spending). We find that cross-province variation in the importance of these channels is correlated with the importance of private and state-owned enterprises and demographic factors. We discuss implications of our results for global imbalances in capital flows.

Statistics

Citations

Dimensions.ai Metrics

Altmetrics

Downloads

27 downloads since deposited on 18 Jan 2018
25 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
Uncontrolled Keywords:China, Chinese provinces, Capital flows, current account, global imbalances, external adjustment, present-value models, regional business cycles
Language:English
Date:August 2017
Deposited On:18 Jan 2018 08:22
Last Modified:23 Feb 2019 08:08
Publisher:Springer
ISSN:1610-2878
Additional Information:Also published as Department of Economics, Working Paper No. 162 (see https://doi.org/10.5167/uzh-97029).
OA Status:Green
Publisher DOI:https://doi.org/10.1007/s10290-017-0278-0

Download

Download PDF  'A provincial view of global imbalances: regional capital flows in China'.
Preview
Content: Accepted Version
Filetype: PDF
Size: 477kB