black market exchange rate and the productivity bias hypothesis abstract previous studies that tested the productivity bias hypothesis employed the official nominal exchange rate in constructing the real rate hence in testing the productivity bias hypothesis in this paper we show that if official real exchange rate does not support the productivity bias hypothesis the real black market rate does this conjecture is tested by using data from chile colombia and costa rica

the penn balassa samuelson effect through the lens of the dependent economy model abstract the positive correlation between per capita income and cross country price levels is called the penn balassa samuelson effect the most influential explanation of this effect centers around sectoral output productivities as the determinant of the relative price of nontraded goods the interaction between the change in relative prices and the change in per capita income the dynamic pbs effect is less well known this paper extends the turnovsky and sen 1995 model of a small open economy by adding external economies into the production function the model s dynamics accord well with several features of the empirical data on the dynamic pbs effect

urban bias rural bias or state bias urban rural relations in post revolutionary china the authors aim to evaluate the relevance of urban bias and rural bias to the chinese case they present empirical evidence on the nature and extent of differentiation in rural urban living standards examine the political basis of relevant economic policies and investigate the relationship between these policies both the changes in labour productivity in each sector and the inter sectoral savings transfers both urban and rural bias hypotheses illuminate certain dimensions of chinese development strategy but the realities of rural urban relations have been complex and analysis must be supplemented by a focus on the divide between state and society and the question of state bias

walking with moneylenders the ecology of the uk home collected credit industry the aim of the paper is to assess the role of doorstep credit companies in the delivery of financial services in areas affected by high levels of financial and social exclusion in particular the paper looks at the relationship between agents and customers using two metaphors associated with interaction between different species in an ecological setting namely parasitism and symbiotic mutualism the metaphor of parasitism circulates widely within debates about moneylending in the media and among advocacy groups such as the consumer association that work on behalf of low income individuals and households the metaphor of symbiotic mutualism describes the depiction of the relationship between consumers and moneylenders put forward by the moneylending industry drawing on field work undertaken within moneylending companies this paper argues that the relationship between the agents and customers is cultivated to overcome information asymmetries that is to produce information about customers ability to

financial exit routes from the poverty trap a study of four uk cities potentially community development finance institutions cdfis represent a promising complement to the welfare system in its attempts to reduce poverty since they provide finance to the financially excluded and potentially remove a barrier to their acquisition of assets drawing on a new survey of around 360 households in four uk cities surveyed both before and after the 2008 09 recession it is found that a major factor determining whether low income households receiving cdfi loans are able to exit from poverty is their ability to save this is found to be determined by a variety of attitudinal and institutional factors including the rationality of their coping strategies the nature and extent of social networks and the extent of their access to money advice it is argued that some of these causal factors are amenable to policy

extrinsic versus intrinsic problems of agricultural cooperation anti incentivism in tanzania and china peasant willingness to engage in collective farming and the efficiency of collective farms once established may be preconditioned on local self determination participatory control discriminating work incentives and external manoeuvrability in the absence of such preconditions whether or not there exist economies of scale sufficient to offset effectively minimised incentive problems cannot be determined anti incentivism bureaucratic controls and extractive external environments are identified as factors inhibiting successful collective farming in both tanzania and china explanations of these tendencies in the two countries are sought in their political economies and ideological structures

a reexamination of balassa s productivity bias hypothesis rency by ri s the price level in country i by pi and the price level in the united states by pu s the ppp theory postulates that ri u s pi pu s many studies have tried to verify whether exchange rates follow the path outlined by the ppp equation the empirical results at best are inconclusive for example j a frenkel tested the ppp by drawing data from the 1970s and showed that the ppp failed on the other hand n davutyan and j pippenger criticized frenkel s work and reversed his conclusion 2 both studies used ordinary least squares and two stage least squares methods even recent studies that have used a relatively modern econometric technique cointegration analysis have mostly rejected the ppp 3 several reasons have been given in the literature for the failure of the ppp or deviation of the ppp based exchange rates from equilibrium exchange rates including lack of free trade existence of transaction costs existence of nontradables simultaneity problems different weights used in constructing different national price indexes money and asset prices and real factors or real variables among the real variables the productivity differential between two countries has received most of the attention in the literature if we denote the market determined equilibrium exchange rate by re and the ppp based rate by pi pu s following the literature we

real and monetary determinants of real exchange rate behavior theory and evidence from developing countries abstract this paper develops a dynamic model of real exchange rate rer behavior in developing countries a three goods economy exportables importables and non tradables is considered residents of this country hold domestic and foreign assets and there is a dual exchange rate regime there is a government that consumes importables and non tradables a distinction is made between equilibrium and disequilibrium movements of the rer the determinants of real exchange rate misalignment are studied with emphasis placed on the role of devaluations and balance of payments crises the implications of the model are tested using data for 12 developing countries the results obtained are generally favorable for the model the issue of rer stationarity is also analyzed

agriculture looks for shoes that fit the production responsibility system and its implications abstract by the end of 1981 problems clearly recognized within the communes included low productivity the failure to accumulate funds for modern inputs inefficient and corrupt cadres hidden unemployment inability to stimulate growth in other than major crops and disappointingly low levels of peasant incomes in many counties in north china peasants in 1980 began to divide up the collective fields on communes into smaller plots for cultivation by households and labour groups since then the face of china has been altered physically politically and organizationally by the creation of the responsibility system largely outside party control and influence document 75 of september 1980 sanctioning some form of production responsibility system was itself overtaken by events as a bewildering variety of forms emerged swamping the cadres practice was rapidly expanding beyond the theoretical discussions or pronouncements of officials like du runsheng the paper describes each of the many forms of contracting between peasant groups and the state now current in china with estimates of the relative proportions of the accounting units involved in each type table 3 new contradictions are already emerging in the changed rural set up partly because farm management problems bear similarities to those that confronted the open field strip farming of the european manor while the incentive to have more hands on family farms contradicts official chinese population policy

impact assessment methodologies for microfinance theory experience and better practice abstract microfinance programs and institutions are increasingly important in development strategies but knowledge about their impacts is partial and contested this paper reviews the methodological options for the impact assessment ia of microfinance following a discussion of the varying objectives of ia it examines the choice of conceptual frameworks and presents three paradigms of impact assessment the scientific method the humanities tradition and participatory learning and action pla key issues and lessons in the practice of microfinance ias are then explored and it is argued that the central issue in ia design is how to combine different methodological approaches so that a fit is achieved between ia objectives program context and the constraints of ia costs human resources and timing the conclusion argues for a greater focus on internal impact monitoring by microfinance institutions

rejoinder food agricultural and trade policy to the year 2000 abstract this article partly in response to fred sanderson s article pp 363 73 challenges the narrow approach of forecasting the future food situation by extrapolating current trends and the view that little can be done to improve the predicament of the poorest of the poor this article argues that we must look for ways of breaking out of the vicious circle of low income low economic demand low productivity and low levels of resource utilization

unequal economic development in china spatial disparities and regional policy reconsideration 1985 1995 zhao x b and tong s p 2000 unequal economic development in china spatial disparities and regional policy reconsideration 1985 1995 reg studies 34 549 561 almost two decades into the implementation of deng xiaoping s get rich first policy and coastal development strategy income inequality and an imbalance in regional development have emerged as two of the most disturbing factors affecting contemporary china this paper examines regional disparities in contemporary china and their changing trends and magnitude based on a time series analysis of data sets for income and production across china for the last 10 years this paper focuses on the examination of gini coefficients and coefficients of variation for two key economic indicators gdp per capita and household income per capita at four levels of geographical aggregation provincial regional urban and rural given that chinese policy makers appear to have been strongly influenced by the two western theories of regional development w

rural urban disparity and sectoral labour allocation in china this study examines china s rural urban segmentation and its causes in the context of economic reforms household survey and aggregate data indicate a v shaped process in which rural urban consumption and income differentials decreased between 1978 and 1985 but then have continually increased to historically high levels this sectoral division is consistent with production function estimates based on provincial data that reveal higher labour productivity in urban state owned industries than in rural industries and agriculture to explain the v shaped change we argue that the precedent of successful rural reforms raised farmers relative earnings but the remaining obstacles to an efficient sectoral allocation of labour have prevented china from eliminating dualism recent financial policies consisting of urban price subsidies and increased investment credits have also had influential distribution effects that are biased against the rural sector

international evidence on tradables and nontradables inflation abstract using 1970 1985 sectoral data for the oecd we find that inflation in nontradable goods exceeds inflation in tradables we identify a demand shift towards nontradables and faster growth of total factor productivity in the tradable goods sector as the prime causes of the differential inflation in addition disinflation attempts and the exchange rate regime appear to have exerted significant influence on the relative inflation rate

chinese urbanization and development before and after economic reform a comparative reappraisal abstract this paper analyzes the recent process and consequences of china s urbanization by weighing the short term policies and long term strategies concerning national development and urban growth against the objective material conditions and competing group interests in chinese society comparative insights are drawn from the experiences of other late developing countries where the effects of political decisions concerning urban growth have been fundamentally modified by social and economic forces thus china s urbanization is examined here in terms of the four major aspects of third world urbanization overurbanization urban bias and the parasitic versus generative nature of cities rural development and the role of small urban places and interregional balance in urbanization and development the rapid and complex process of urbanization certainly helps boost the dynamic of the post mao chinese economy but not without the problematic symptoms of congestion and inequality

spatial aspects of chinese development issues outcomes and policies 1949 79 despite wide initial spatial inequalities and a respectable rate of national economic growth since 1949 available evidence suggests that certain key spatial inequalities in china have narrowed progress has been uneven however and there is no simple correlation to be found between the pursuit of maoist regional policies and the narrowing of spatial inequalities that actually occurred this points to the need to qualify the conclusion of many western scholars that maoist policies actually succeeded in achieving rapid sustainable growth while narrowing most differentials including spatial differentials

a model of real national price levels this paper is concerned with the price level in the sense used in a recent paper by kravis and lipsey entitled toward an explanation of national price levels 15 the price level of a particular country relative to the base country is defined as the ratio of the purchasingpower parity ppp to the exchange rate it has become generally recognized that the ppp need not equal the exchange rate even in long run free trade equilibrium and the explanation of the discrepancy is a natural subject of scientific interest there is a voluminous literature on temporary deviations of ppp from the exchange rate that are explained in terms of monetary disturbances and random shocks there is a much smaller literature on long run or structural factors that explain why ppp does not coincide with the exchange rate the present paper falls in the second category we shall assume the economy is in monetary and balance of payments equilibrium the term price level as used in kravis and lipsey 15 may be confusing because that term usually refers to the price of goods in terms of money the term real price level seems more appropriate in that the concept refers to a ratio of two prices the real price level is what the tourist has in mind when he goes to a poor country and remarks my but prices are low here a major feature of the existing literature on long run or structural explanations of the real price level is the emphasis on the distinction between tradables and nontradables it is typically assumed that the law of one price holds for tradables but not for nontradables which are dominated by services the productivity differential model as stated by balassa 2 for example assumes that international differences in labor productivity are greater in commodities tradables than in services it follows that services will be relatively cheap in poor low productivity countries and that consequently the real price level relative to a base country will rise with per capita income recently bhagwati 5 has shown that the low relative price of services in poor countries can be explained by a capital labor model without recourse to the assumption that production functions differ internationally in bhagwati s model rich countries export capital intensive commodities and poor countries export labor intensive commodities but even though commodity prices are equalized through trade complete specialization prevents factor prices from being equalized since services are assumed to be labor intensive relative to any commodity they are cheaper in poor countries than in rich countries

productivity consequences of alternative land division methods in china s decollectivization an econometric analysis abstract in this paper we examine the productivity effect of the manner of distributing collective land to households under the chinese economic reforms of the 1980s during that period land was distributed by a formula putting weight on both household size and household labor force and land and labor markets were absent or underdeveloped in most regions a simple model of household decision making is developed for this case and a basic result is that agricultural output is concave in the proportion of land distributed according to workforce as opposed to household size this hypothesis is tested on data for 61 production teams of a township formerly commune in hebei province under a quadratic specification grain output displays the expected concave relationship with the land distribution parameter our results provide some evidence of congruence between equality in the distribution of resources and incentives for productivity

explaining service price differences in international comparisons this paper reexamines observed international differences in the price of services and the positive correlation of these with per capita gdp differences using a general trade model with a nontraced sector the authors find that differences in countries factor endowments populations trade policies and trade balances will have ambiguous and sometimes opposite effects on their service prices and real incomes estimating the service price equation using recent data suggests that larger endowments of agricultural land minerals and capital larger trade deficits and higher prices for tradables increase service prices conversely larger populations and labor forces reduce service prices copyright 1991 by american economic association

developmental states and socialist industrialisation in the third world development economics as a discipline and the idea of the state as the organiser of economic activity are inseparable basic concepts and distinctions are put forward to unravel the complex question of the role of the state in the industrialisation process these are then used to examine the state in three waves of socialist industrialisation which shows a strong capacity to mobilise and direct economic social and political resources the typically pervasive state may however outlive its historically progressive role and become a bastion of economic irrationality and political authoritarianism

purchasing power parity in less developed and transition economies a review paper abstract the concept of purchasing power parity ppp has been the subject of numerous studies many of which have been unable to prove conclusively this core principle of international finance although industrialized countries have received most of the attention studies that focus on less developed and transition economies have also attained mixed results this study surveys trends in this branch of the literature highlighting the econometric advances that have sought to solve this puzzle while pointing out that more needs to be done to address the reasons that might cause ppp not to hold

productivity differentials the relative price of non tradables and real exchange rates abstract this paper reconciles the apparent contradiction between recent panel unit root tests of real exchange rates and the productivity differential model proposing an alternative view that explains the coexistence of such findings real exchange rates and the relative price of non tradables reflect the gradual adjustment of mean reverting and endogenously competing factors supply and demand shocks as well as traded goods arbitrage granger causality and variance decomposition results indicate substantial simultaneity and feedback effects between real exchange rates the relative price of non tradables and productivity differentials

the peasant family in the transition from maoist to lewisian rural industrialisation rural industrialisation in china in the post maoist era involves the social transformation of the peasant population into a new class which is partially detached from agriculture and employed in diverse non state enterprises ranging from family run businesses to village and township run enterprises the peasant family internalises this transformation as it reallocates labour and capital into new industrial and tertiary sectors while maintaining agricultural production as a first and last means for labour absorption and subsistence since it is peasant families not the chinese state or the collective that now wholly undertake the burden of supporting the sizeable labour surplus their managerial autonomy tends to result in an energetic effort at economic rationalisation mainly through sectoral diversification of family income sources statistical analysis shows that the adoption of household production responsibility systems in agriculture while ambiguous in its effects on agricultural productivity w

why are services cheaper in the poor countries in their important work on international comparisons of national incomes and of comparative price structure kravis heston and summers i982 p 8 have noted that services are much cheaper in the relative price structure of a typical poor country than in that of a rich country this phenonomen has been documented now fairly systematically by the data gathered under their guiding hand of the united nations international comparison icp which covers 34 countries table i reproduced from their work i982 and fig i based on rows 3 and ii 13 indeed show this tendencyfor the relationship between relative service prices and real per capita gdp in this kravis heston summers 34 country 6 group sample the tendency is strongly evident except for the intermediate groups iii and iv

the incentive problem and the demise of team farming in china abstract this paper begins with a discussion of what can be inferred about the efficiency of collective farming from the demise of team production in rural china after reviewing the formal literature on incentives in collective farms it examines two problems that may have plagued the chinese teams first excessive egalitarianism which can be analyzed by modifying existing models and second monitoring problems which require a departure from the perfect information context of those models by numerical example it is shown that the superiority of household farming over forced collective farming does not preclude the possibility that some team production would have existed in a democratic equilibrium dominating both of them finally the post reform household contracting system is examined with special reference to distributive and allocative issues

the impact of china s economic reforms on agricultural productivity growth this paper presents a method for assessing the relative importance of price increases and strengthened individual incentives due to the introduction of the responsibility system for the post 1978 increase in china s agricultural productivity data on post 1978 chinese agricultural performance suggest that a little over three quarters of the measured productivity increase is due to payment system changes and the remainder to price increases we also use our method to calculate incentive indices giving an estimate of the fraction of their marginal product that peasants received under the pre 1978 regime

political economy of class struggle and economic growth in china 1950 1982 abstract the chinese economic cycle is both a cycle of accumulation and construction activity and a political cycle exercising its influence by trial and error methods and changes from voluntarist to pragmatic planning approaches as a result of some excessive accumulation in the form of net investment in non productive sectors there was a lag in infrastructures like energy and transport and trade off against consumption more severe than expected structural imbalances in the economy would have had to have been tackled after 1976 even if the voluntarists had been in office the eclipse of central planning supporters was of 1979 1980 duration only thereafter the line on planning and the market became less enthusiastic as the concept of market socialism faded stabilization of the relative growth rates of heavy industry and light industry was compatible with both the programme of the chen yun reformers and those reluctant to give ground from realistic plans to the law of value in agriculture the masses of small peasant proprietors rather than party factions decided the shift to the new system of material incentives based on households in this weaknesses of maoist practice in solving rural poverty played a role nevertheless the left can defend collectivist ownership to some extent by adopting a more reasonable programme than in 1966 1976

productivity bias hypothesis and the purchasing power parity a review article abstract productivity differentials among countries are said to be one of the major sources that contribute to the deviation of the purchasing power parity based exchange rate from the equilibrium rate hence the productivity bias hypothesis prior to last review article on the productivity bias hypothesis in 1976 almost all studies relied upon cross sectional regression analysis since then two groups of empirical studies have emerged while one group has employed time series data the other one has used panel data these two later groups have provided more support to the hypothesis than the earlier cross sectional studies this paper reviews and criticizes each group separately and provides tables that summarize main features of each study

state and market in china s labour reforms this article sets out to look at how china s labour reforms have been conceived and implemented and to assess their impact on the urban industrial economy labour reform is an area of particular political sensitivity because it engages deep ideological issues relating to the character of socialism so the political dimensions of labour policy are particularly important in the chinese case

sub saharan africa s growth south south trade and the generalised balance of payments constraint using the post keynesian balance of payments constrained growth approach we investigate the recent increase in sub saharan africa ssa growth focussing on the contribution of south south trade the model is estimated by panel co integration on a sample of 20 low and lower middle income ssa countries using annual data from 1990 to 2008 and considering three partner areas ssa itself developing asia and the rest of the world the results show that in the past decade the balance of payments constraint of ssa has been relaxed this shift has occurred through different channels of transmission the other ssa countries contributed through the real growth effect developing asia through the market share effect and the rest of the world through the terms of trade effect these results help reconcile puzzling evidence on the pattern of ssa external indebtedness and provide new insights on the role of asian drivers on ssa growth as well as on the sustainability of ssa growth recovery

ration subsidies and incentives in the pre reform chinese commune a central feature of the egalitarianism said to have undermined work incentives in chinese agricultural produ ction teams during the 1960s and 1970s was the distribution of grain rations independently of work contribution this paper analyzes two m odels of grain rationing one drawn from existing theoretical literat ure and the other perhaps more closely based on chinese practice it finds that a scheme of the type commonly depicted was more costly to operate but provided better incentives to labor poor households unde r both schemes however the scope for material incentives was reduce d by grain ration guarantees and was smaller the poorer the team copyright 1988 by the london school of economics and political science

urbanization and underdevelopment a global study of modernization urban bias and economic dependency the causes and effects of 3rd world urbanization have been addressed in theories of modernization urban bias and economic dependency but no single cross national study has tested the arguments advanced by all 3 theories this paper uses panel regression analysis to assess the validity of the 3 perspectives in 61 underdeveloped countries between 1960 and 1980 the modernization theory asserts that industrial employment attracts people to urban areas where they work in modern sector employment that facilitates national economic expansion the urban bias theory posits that the disparity in welfare between country and city increases rural to urban migration and thereby expands both urbanization and service informal employment dependency and world system arguments assert that foreign investment promotes both urbanization and service informal labor with foreign investment in agriculture pushing farmers townward and foreign investment in urban manufacturing pulling them there results suggest that underdeveloped nations are experiencing a gradual transition from an agrarian to a service and informal economy a transformation that impedes economic expansion unfavorable agricultural conditions alone will not push rural citizens to urban areas 2 theories help explain the relationship between relatives urbanization and economic growth if future studies of urbanization and underdevelopment are going to be useful then they must transcend current theoretical and ideological particularism

structural determinants of real exchange rates and national price levels some empirical evidence contrary to the long held notion of purchasing power parity ppp economists have found systematic evidence that the general level of prices across countries at a point in time varies dramatically irving b kravis alan w heston and robert summers 1982 for example report that some countries national price levels are no more than one third the u s price level extensions of this work show that such departures from ppp have persisted for decades recently efforts have been made to explain systematically these persistent or structural departures from ppp pioneering work by kravis and robert e lipsey 1983 1987 1988 has demonstrated that a positive correlation between the price level and real per capita gross domestic product is robust across numerous cross sectional specifications for instance using data from kravis et al 1982 table 6 12 87 percent of the variation in national price levels pl of 21 countries in 1975 is explained by per capita gdp y and a constant

urban employment and labour allocation policies in post mao china abstract china s leadership has faced serious urban unemployment and inefficient state labour allocation systems their drive to increase employment through economic readjustment makes developmental sense and the quantitative results appear impressive but the problem of urban labour surplus defies solution in the short term given population pressures planning weaknesses economic constraints and ideological proscriptions efforts to improve the allocation and utilization of labour have foundered because they contradict employment policy and are opposed by key urban groups these issues throw into relief the complex relationships between economic and political determinants in the chinese reform process

real exchange rates ppp and the relative price of nontraded goods the purchasing power parity hypothesis ppp states that nominal exchange rates move with differences in relative prices between economies the theory has received considerable attention in the economic literature since cassell 6 and is the foundation of many long run theoretical hypotheses in international finance yet its empirical validity remains in question many tests of ppp focus on the stationarity of the real exchange rate the nominal exchange rate adjusted for changes in price levels between economies if domestic and foreign price levels and the nominal exchange rate are integrated then cointegration between these variables implies the existence of both a long run equilibrium relationship and ppp the residual the real exchange rate then follows a stationary process the paper uses the multivariate cointegration methodology of johansen 16 and johansen and juselius 17 18 to examine the source of real exchange rate nonstationarity is the nonstationarity due to shifts in the domestic and foreign price of nontradeables or productivity differentials between traded and nontraded sectors or is the nonstationarity a possible outcome of difficulties in intercountry comparisons of prices movements associated with construction of these price indices most research finds the real exchange rate follows a nonstationary process due to the presence of a unit root 8 12 1 9 19 27 however the existence of a variable trend in the real exchange rate does not imply the absence of a long run relationship between relative prices levels and nominal exchange rates for two reasons first a long run relationship between price levels and nominal exchange rates may exist but not the one for one relationship implicit in the calculation of real exchange rates due to measurement differences in the construction of price indices between economies second ppp violations may occur due to the presence of permanent productivity innovations which affect the relative price of nontradeables if these shocks are not represented by measurable variables a cointegrating relationship will not exist the paper constructs traded and nontraded gdp price indices and productivity rates for 14 oecd economies and tests 1 if the variable trend the nonstationary process in the real exchange rate is due to permanent innovations in relative price of domestic and foreign nontradeables 2 if long run ppp violations are due to permanent movements in the relative price of nontradeables 3 if the nonstationarity in the real exchange rate is due to permanent innovations in domestic and foreign productivity differentials between the traded and nontraded sectors 4 if the variable trend in the relative price of nontradeables is due to permanent innovations in productivity between sectors lastly the paper constructs a cointegrating error correction model

trigger strategies in chinese agricultural teams in this paper the reasons why chinese agricultural teams could not reply on the threat of internal effort response to solve incentive problems are investigated the detrimental effects of state extractive agricultural policies the basic needs program and cultural revolution era ideology on the dynamic self enforcing mechanism in chinese teams are analysed using the data on the teams of a moderately prosperous commune during the period 1970 76 the author estimates the discount factor and the impact of the trigger strategies on workers effort decisions it is found that the estimates of the discount factor and the trigger strategy effect are significantly greater than zero in some periods but not large enough to eliminate the need for monitoring

purchasing power parities and exchange rates in latin america purchasing power parity ppp studies in recent years have revealed clearly that international comparisons of real income based on exchange rate conversions are very misleading indicators of standards of living there is no question that ppps provide the conceptually appropriate conversions of national accounts statistics from one currency to another and recent studies have shown that ppps deviate substantially from exchange rates 1 stimulated in part by the appearance of new bodies of data economists have recently renewed their interest in theoretical explanations of the long term or structural deviations of ppps from exchange rates the empirical tests of these models have been conducted almost entirely with data from the international comparisons project icp the purpose of the present paper is to test some of these models with a body of data collected by eciel for some latin american countries in 1970 2 this sample can also be combined with the phase 1 1970 sample of the icp to put this empirical study in context i shall first review briefly the theoretical and empirical literature on deviations of exchange rates from absolute ppps then i shall proceed to the empirical procedures and findings

income inequality in the people s republic of china trends determinants and proposed remedies the issue of income inequality in the people s republic of china prc has attracted world wide attention leading to a sizable literature this paper attempts to provide a nonexhaustive literature review of the prc s inequality trends and determinants and suggested government interventions it discusses profiles of income inequality along three dimensions interhousehold disparity regional divides and urban rural gaps this is followed by an exploration of the driving forces behind rising inequality including the notorious hukou system policy biases location or geographic factors globalization and education finally the paper summarizes and proposes government interventions for containing or reducing income inequality in the prc important areas for future research are also suggested in the final section of the paper

egalitarianism subsistence provision and work incentives in china s agricultural collectives abstract collective agriculture in china failed because its reward system was too egalitarian to provide sufficient work incentives to the peasants a popular view attributes egalitarianism to the difficulties of monitoring work effort in a team an alternative view presented here argues that a the egalitarian provision of basic foodgrains to peasant households reflected more generally the consumption problem of the peasantry who were impoverished by the state s policy of extracting agriculture and b as a remuneration system time rates better served the work and income sharing purpose than piece rates and therefore better protected households with high dependency ratios egalitarianism survives under the household farming system

the determination of the real exchange rate the productivity approach abstract this paper explains deviations of exchange rates from purchasing power parity with the differences between countries of the relative growth rates of labor productivity between traded and nontraded sectors two cases are considered germany and japan versus their respective major trading partners the results show that the time series methodology yields a more favorable confirmation of the productivity differential model than the cross section regressions in the literature

reform and urban bias in china income inequalities between urban and rural areas remain high in china but the gap has begun to narrow peasant incomes have increased dramatically since the post mao reforms rural areas have new power but this is a consequence not a cause of the reforms the improvement in rural conditions reflects a change in the central state s development strategy and ideology and the local response to incentives embedded in china s reforms the impetus for these changes is self preservation of the state and the chinese communist party the failure to close decisively the income disparities between the urban and rural areas similarly stems from concerns of regime stability and preservation of the party state

ppp in the 34 oecd countries evidence from quantile based unit root tests with both smooth and sharp breaks abstractconventional unit root tests have mostly failed to validate the ppp quantile based unit root tests by previous research have provided some support for the ppp in this article we take an additional step and incorporate sharp shifts and smooth breaks into the quantile based unit root test and re examine the ppp in each of the 34 oecd countries over the period 1994 01 2016 03 we find support for the ppp in 18 countries of austria chile estonia finland france germany italy korea mexico netherlands new zealand poland portugal slovenia sweden switzerland turkey and the united kingdom

the structure and contradictions of productive relations in socialist agrarian reform a framework for analysis and the chinese case this article attempts to develop a complex analytical framework for analysing socialist agrarian reform and to apply it to the case of post mao china perhaps the most sweeping agrarian reform in the history of socialism the purpose of doing so is to disaggregate the complex changes which have been wrought under the responsibility systems in order to get a more nuanced sense of what has and has not changed how the various parts fit together and where the axes of contradiction posed by the reform may lie this analytical framework may also be of use in comparative analysis of socialist agriculture though that enterprise is not attempted here one basic argument of this study is that the responsibility systems of the recent chinese reforms are neither socialist nor capitalist but something distinctive whose potentially heterogeneous elements must be identified disaggregated analysed one by one and then reconstituted in order to expose their nature dynamics and contradictions

regional inflation spatial locations and the balassa samuelson effect evidence from japan we empirically analyse regional inflation using data from japan where there is no regulation to impede the free movement of labour capital goods and services across regions in particular our analysis will focus on the geographical location of regions and the productivity known as the balassa samuelson bs effect as explanations for the dynamics of regional inflation based on a spatial model which is consistent with the theoretical specification of the bs we have confirmed that while it is a relatively small country in terms of land area both spatial location and productivity are important determinants of regional inflation

on hierarchical spatial competition in this paper we consider a hierarchical model of spatial electoral competition with two dominant players incumbents and one entrant the incumbents engage in a non cooperative game against each other and act as stackelberg leaders with respect to a vote maximizing entrant we prove that the equilibrium of this game called a hierarchical equilibrium exists and is unique for an arbitrary single peaked distribution of voters ideal points moreover we fully characterize the set of equilibrium strategies and show its equivalence to the set of strategies generated by a perfect foresight equilibrium most of the recently developed models of entry in oligopolistic markets and the theory of political competition deal with the case of dominant firms or parties which face a threat of potential entry these models possess a number of features on which they may be compared and contrasted the most important of these features are the ways in which the existing parties or firms compete against each other for votes or profits and types of expectations the incumbents have about the responses of potential entrants to changes in their decisions in most of the cases an electoral or oligopolistic competition is represented by some type of a non cooperative game played by parties or firms in this paper we also consider a non cooperative model of electoral race where the established parties incumbents compete against each other by offering positions ideologies to the population of voters given the profile of voters preferences over the space of ideologies or issue space each of the established parties attempts to maximize its vote share in making their choices the incumbents however anticipate that a new party an entrant will join the electoral race consistent with the other parties objectives the entrant is assumed to maximize its share of voters while taking the incumbents choices as given the resulting non cooperative game possesses therefore a structural hierarchy the established parties behave as nash players with respect to each other whereas acting as stackelberg leaders with respect to the entrant and correctly anticipating its vote maximizing response to their choices in the issue space the main purpose of this paper is to study the properties of the game we described and in particular to characterize its equilibrium which we will call hierarchical equilibrium naturally some assumptions are needed in order to guarantee the existence of the equilibrium we assume that there are two established parties the issue space i is the uni dimensional interval all voters have symmetric single peaked peaked preferences over i and the distribution of the voters ideal points is represented by a quasi concave continuous density function under these rather mild assumptions we are able to prove the existence and uniqueness of the hierarchical equilibrium and to completely

estimating long run economic equilibria with stochastic trends an asymptotic theory is provided to analyze a menu of currently existing estimators of cointegrated systems we study in detail the single equation ecm seecm approach of hendry our theoretical results lead to prescriptions for empirical work such as specifying seecm s nonlinearly and including lagged equilibrium relationships rather than lagged differences of the dependent variable as covariates simulations support these prescriptions and point to problems of overfitting not encountered in the semiparametric approach of phillips and hansen 1990