Essays on the Political Economy of Development
Creators: Zhang, Qing
Publisher: name: Columbia University
Year: 2019
Subjects: Economics
Economic development
Urban economics
Economic policy

description: My dissertation studies political economy issues in the development of China. Chapter 1 lies in the intersection of urban economics and political economy. This chapter exploits plausibly exogenous variation generated by a unique national policy in China that requires all residential buildings to receive sufficient hours of sunshine to study a central question in urban economics, namely, whether urban density facilitates the diffusion of information. The policy creates higher degrees of restriction on density at higher latitudes, where longer shadows require buildings to be further apart. Data on individual housing projects across China reveal that the cross-latitude variation in regulatory residential Floor Area Ratio can be described quite well by a formula linking structure density to latitude through the solar elevation angle. These differences in building density further induce differences in population density and land prices across latitudes. Using differential topic dynamics on a national petition platform to measure information diffusion, this chapter shows that people respond to shifts in government attention with varying speeds across latitudes. Increases in local government reply rate to a topic raises the volume of subsequent posts on the same topic, exhibiting an S-shaped time trajectory consistent with local information diffusion about shifting government priorities. These responses are systematically faster in southern cities, where density is higher. Survey evidence further indicates that otherwise similar individuals are more likely to gossip about public issues in a southern city.  
      Chapter 2, coauthored with Junyan Jiang and Tianguang Meng and forthcoming at the journal Governance, examines the flip side of the interaction between local governments and citizens studied in Chapter 1. This chapter studies the response of government policies to opinions expressed online. We address this question by studying the patterns and consequences of online participation at a major electronic petition platform in China. Content analysis of around 900,000 petitions reveals that a substantial share of them concern lower-class issues and are originated from less developed rural and suburban areas. Linking variations in petition volumes to an original dataset of government policy priorities, we further show that online participation led governments to place greater emphasis on social welfare policies and to increase the coverage of a key low-income assistance program. These results underscore the potential of online participation as an important mechanism to improve the quality of governance.
      Chapter 3, coauthored with Amit Khandelwal, Suresh Naidu and Heiwai Tang, turns to a systematic examination of China's reform process. We apply natural language processing methods to analyze a comprehensive corpus of 1.4 million legal documents issued by the Chinese government at central and local levels since 1949, and measure their market orientation in a data-driven fashion. We document an active introduction of market-oriented legal infrastructure from the mid-1980s to around 2000, which slowed down in the last fifteen years. These dynamics are present within fine-grained policy domains. We find that the market orientation of policies explains just an extra 2% of provincial variation in GDP per capita growth beyond province and time fixed effects. Variable selection based on richer representations of the text exhibits similarly limited predictive power for provincial growth. Taken together, these findings suggest the importance of studying the informal arrangements between market participants and government officials.