Market Reforms Research Articles

How Does Land Monopoly Reduce Consumption Levels? Evidence from China

Understanding the intrinsic relationship between land monopoly and a low consumption rate is of great significance for optimizing the national economic structure and reforming the land system. However, existing studies of low consumption ignore the role of the land system. This study, therefore, theoretically analyzed how a monopolistic land supply system inhibits consumption and empirically tested the causal and influencing mechanisms using the mediated effects model and provincial panel data from 2000 to 2017 in China. The results are as follows: (1) land monopoly significantly reduces the final consumption rate; the results remain robust under different model settings. (2) A heterogeneity analysis indicated that the negative effect of land monopoly on consumption is greater in the central and western regions than in the eastern regions; economic catch-up and government intervention increase such harm as well. (3) Under the land monopoly system, most land income flows to the public sector and urban areas, reducing the share of private sector income and expanding the urban–rural income gap, thus limiting private consumption and total urban–rural consumption. (4) During the 2000-2019 period, the expansion of monopolistic land transfers caused an additional 1.98 percentage points of decline in the final consumption rate, contributing 23.41% of the decline in the final consumption rate. Our findings provide new insights into the causes of low consumption and suggest that economic rebalancing can be achieved by breaking land monopolies through land supply-side reforms and land marketization reforms.

Competition among purposes: The Chinese Experience in the Governance of Climate Change and Energy Transition

ABSTRACT Energy governance at the international level is fraught with difficulties due to the ‘competition among purposes’ between different bodies of international law. In this paper, we extend this thesis to argue that the same tension may be found in domestic energy governance. Drawing from China’s experience in the governance of climate change and energy transition, we analyse how the misalignment of incentives between different actors and the incomplete market reform led to a drastic shift in policy in 2021. We also compare the different approaches in China’s energy governance and trade governance and draw some general lessons on how developing countries might overcome such governance problems.

MIDDLE CLASS IN UKRAINE: GOVERNMENT OR OPPOSITION?

MIDDLE CLASS IN UKRAINE: GOVERNMENT OR OPPOSITION?

The role of European Union values in the Ukrainian social-humanitarian safety provision system

The article aims to analyze the role of European Union values in providing a social-economic and humanitarian safety provision system in Ukraine. The research methods include descriptive analysis, an interdisciplinary approach integrated into the different analytical fields, and the range of humanitarian safety perspectives they bring to bear on a certain topic, theme, or issue in the political, economic, legal, and social sciences estimate. The checked hypothesis is the social-humanitarian safety provision system depends on the process of democratization of society and the functioning of democratic institutions in Ukraine. The democratization of society created the fundament of the social-humanitarian safety provision system. The democratization process depends on the relationship between European values and regional-specific factors in Ukraine. The social and humanitarian safety provision system in Ukraine closely interconnected with the degree of economic, political, and social transformation, as well as the overall indicators of the market and democratic reforms. The analysis of reforming institutions in Ukrainian and European Union (EU) values and beliefs adoption and adherence defines the key problem of the social and humanitarian safety provision system. The balance of European and regional values directed to the achievement of an acceptable level of the social-humanitarian safety provision system in Ukraine. The creation of institutions that ensure the acceptable balance formation of European and regional values is an important task for EU integration. The transformation of social-political values to EU values relates to the process of democratization. Social-humanitarian safety provision system depends on the effectiveness of functioning democratic institutions.

The politics of structural reform in Ireland: Dominant growth coalitions, domestic business elites, and internal devaluation

This paper broadens the scope of the Growth Model (GM) research agenda beyond the study of ‘core’ business elites by investigating the influence of (oft-neglected) non-core business actors and sectoral interests in determining growth strategies. To do so it looks at a crucial case in the GM debate: Ireland. Ireland’s robust recovery from the eurozone crisis has set it apart from the rest of the eurozone periphery. For GM scholarship, Ireland’s recovery has been driven by its long-established multinational/export sector, which is relatively indifferent to the effects of austerity and internal devaluation. Why, then, was internal devaluation a central plank of Ireland’s crisis response and Economic Adjustment Programme (EAP)? Drawing on 10 original interviews with Irish business elites and policy makers and documentary evidence, this paper shows that domestic, not multinational, business elites played a key role in framing conditionality related to competitiveness and labour market reform in the Irish EAP. This challenges the concept of ‘dominant growth coalitions’ and argues that an exclusive focus on ‘core’ business elites neglects the ability of other fractions of business power to determine growth strategies. Looking beyond ‘core’ business elites makes it possible to identify transformation behind more obvious patterns of continuity.

Multi-objective investment evaluation for low-carbon power system evolution based on system dynamics

The energy transition development path towards low carbon power systems requires considered investments for system design. A multi-objective investment evaluation method for power system evolution towards low-carbon is established based on multiple development goals including energy security, ecological protection, economic development and technology advancement. The four aspects are modeled based on system dynamics and provide collaborative quantitative evaluation for power system evaluation. Different evolution paths are simulated and analyzed with different policy scenarios, which verify the effectiveness of the proposed model. The results of several indices show that with strong enough policies, it is expected to achieve the CO2 peak around 2030. And accelerating the construction of electricity market reform can provide greater investment space. The ecological protection index has the largest weight in the multi-objective investment, requiring power system to deepen the low-carbon transition.

Pioneers of Gentrification: Women Entrepreneurs Prospecting in a Post-Soviet Industrial City

After the introduction of market reforms in the post-socialist coal-mining city of Mezhdurechensk (Russia), the original urban planning rooted in Soviet industrial modernity adapted to the logic of globalization and gentrification. One way this played out is the conversion of streets into sites of consumption, with the appearance of numerous ground-floor shops that gave underemployed women an opportunity to facilitate early gentrification. This dynamic ended in the mid-2010s, when more prominent market players began to dominate the city space with franchise shops. This article is an ethnographic exploration of how working-class women, drawing on their gendered and class-based skills, demarcate a place for themselves in post-Soviet industrial settings and become the pioneers of gentrification. I also explore the limits of women’s self-employment activities and the narrative of individual responsibility for entrepreneurial failure, namely the eventual closure of their businesses twenty-five years later.

Examining the synergistic diffusion process of carbon capture and renewable energy generation technologies under market environment: A multi-agent simulation analysis

To achieve carbon neutrality, the power industry will vigorously promote renewable energy generation and carbon capture and storage (CCS) technologies. The diffusion of these technologies will vary depending on the incentive policies and market environments. Considering the progressive development of China's electricity market reform, this study constructs a multi-agent simulation model for the long-term low-carbon transformation of power systems, simulating the effects of different market environment and policy tools on the synergistic diffusion process of CCS and renewable energy generation technologies. According to the research results, when the price constraints in the electricity market are relaxed, opting for a differentiated clearing price demonstrates greater benefits for the diffusion of CCS technology and the reduction of carbon emissions compared to using a uniform clearing price. In this situation, the spread of renewable energy generation technologies aids in lowering the average market electricity price, thereby offsetting any potential price hikes resulting from the expansion of CCS technology. Moreover, in the presence of electricity price constraints, policy subsidies are necessary to incentivize the diffusion of CCS technology, with the suitable period for such incentives falling before 2040.

The Governing Establishment and Groups of Interest: The Echo of the Post-Soviet Reforms

The article analyses the activities of the governing establishment and groups of interest during the period of post-Soviet reforms. The specifics and the peculiarities of the formation of the power vertical in different historical periods that influenced the value system of the governing establishment and interest groups are elicited in the article. The economic policy and, as a result, the emergence of the most influential interest groups are outlined based on the example of the Soviet state reforms. Special attention is given to the role of cultural and geographic factors affecting the interest groups’ behaviour strategies. The scenario of the post-Soviet market reforms in the context of creating the competition-based economy is analysed. The institutional differentiation of private and state interests is justified and substantiated for the purpose of economic development.

Research on the Influence of Monetary Policy on Stock Market Return

These changes in China's stock market are influenced by factors such as the share-trading reform and the international financial crisis. During this period, a series of monetary policies implemented in China also had some profound effects on China's stock market. Capital market has always been the main transmission channel of monetary policy. In recent years, China's interest rate system, share-trading system and other reforms have been gradually implemented, and the reform of interest rate marketization has achieved certain results, but it has also brought more uncertainty to the transmission of stock market and monetary policy. With the continuous expansion of the stock market, it has played an important role in the transmission process of monetary policy. At the same time, monetary policy can affect the price of financial assets, thus changing people's behavioral decisions and achieving monetary policy goals. When the actual monetary policy changes beyond or below expectations, it will cause the change of stock price. The existence of expectation effect makes the relationship between monetary policy and stock price change more complicated: taking loose monetary policy as an example, when the actual degree of easing is greater than investors' expectations, stock prices will be positively stimulated by easing; When the degree of easing is less than investors' expectations, the stock price will turn downward. Therefore, it is worth studying to analyze the influence mechanism among monetary policy, stock market and real economy.

Study on Dynamic Pricing Strategy for Industrial Power Users Considering Demand Response Differences in Master–Slave Game

With the deepening of power market reform, further study on power trading mechanisms has become the core issue of power market study. The development stage of the industrial electricity market requires efficient and flexible pricing mechanisms. Currently available pricing strategies are inadequate for demand response management. Therefore, this paper provides an in-depth study of the pricing mechanism in the industrial electricity market in the context of electricity market reform. It proposes a demand–response-based dynamic pricing strategy for industrial parks. The method proposes a dynamic pricing strategy for demand-side response in industrial parks based on master–slave game by establishing an exogenous model of demand-side response and incentives. Compared with the existing strategies, the strategy is more efficient and flexible, and effectively improves the economic efficiency of power trading and load regulation. Firstly, an exogenous model of demand-side response and incentive is built to characterize the demand-side response cost. The method focuses more on describing the exogenous characteristics of user incentives and response quantities. It only needs to analyze the exogenous indicators and random errors in various typical scenarios. The description of user demand-side response is more efficient. Secondly, a master–slave-game-based dynamic pricing strategy for industrial parks with demand-side response is proposed. The strategy is composed of a two-stage optimization. The primary regulation of customers is achieved by day-ahead time-of-use tariffs. The secondary regulation of customers is achieved by means of the same-day regulation of demand and purchase regarding clean electricity. The proposed two-stage price formation mechanism is more economical, more effective in load regulation, and improves the flexibility of industrial pricing. Finally, a case study is conducted on an industrial power user in a park in Liaoning Province. The results show that the proposed method is significantly better than existing methods in terms of improving the economic efficiency and load control effectiveness of the pricing strategy.

Study on the China's real interest rate after including housing price factor into CPI.

The Chinese economy has undergone a long-term transition reform, but there is still a planned economy characteristic in the financial sector, which is financial repression. Due to the existence of financial repression, China's actual interest rate level should be lower than the Consumer Price Index (CPI). However, based on official China's interest rates and CPI, over half of the years China's actual interest rate remained higher than CPI by our calculation from 1999 to 2022. This is inconsistent with the financial repression that exists in China, and the main reason is the calculation methods of China's CPI. China's CPI measurement system originated from the planned economy era, which did not fully consider the rise in housing purchase prices, so the current CPI measurement system can be more realistically presented by taking the rise in housing prices into consider. The core idea of this study is to mining relevant official statistical data and calculate the proportion of Chinese residents' expenditure on purchasing houses to their total expenditure. By taking the proportion of house purchases as the weight of house price factor, and taking the proportion of other consumption as the weight of official CPI, the Generalized CPI (GCPI) is formulated. The GCPI is then compared with market interest rates to determine the actual interest rate situation in China over the past 20 years. This study has found that if GCPI is used as a measure, China's real interest rates have been negative for most years since 1999. Chinese residents have suffered the negative effects of financial repression over the past 20 years, and their property income cannot keep up with the actual losses caused by inflation. Therefore, it is believed that China's CPI calculation method should be adjusted to take into account the rise in housing prices, so China's actual inflation level could be more accurately reflected. In view of the above, deepening interest rate marketization reform and expand channels for financial investment are the future development goals of China's financial system.

The impact of marketed on-grid price on China's photovoltaic industry under the background of carbon neutrality.

The advancement of electricity market reform highlights the need for China's photovoltaic (PV) industry to enter the stage of market competition. Under the carbon neutrality, what impacts electricity market reform has on China's PV industry is an important issue that needs to be considered. This paper analyzes the driving mechanism of the marketed on-grid price and constructs a system framework for the internal connection within the PV industry under the background of carbon neutrality. Then, two system dynamics (SD) models are built to perform the numerical simulation and analyze the evolution process. The results indicate that during the market competition stage, (i) the on-grid price will be stable at about 0.07 yuan/kWh by 2060; (ii) China's PV industry will go through three stages in the future: the first stage is the "rush to install" period for carbon peaking before 2030, followed by the "sluggish installation" period from 2030 to 2038. The third stage is the outbreak period of "PV + multi-scenarios."; (iii) under three scenarios by 2060, the proportion of PV power generation will account for 46%, 39%, and 32%, respectively, which are higher than those under the benchmark on-grid price; (iv) it is necessary for the government and enterprises to continue increasing support for research and development (R&D). Finally, we put forward corresponding policy recommendations.

Energy Price Decoupling and the Split Market Issue

Load scheduling and dispatch by merit order on electricity generation networks has used a wholesale market electricity system operator model focused on system marginal pricing, in which the spot price of electricity at any point in time is equal to the system marginal cost given by the higher value of the price, which rations demand to capacity or the operating cost of the most expensive plant on the system, which is usually a fossil fuel price. This idea has come under challenge because renewable technologies such as wind power farms or solar power farms are treated as having close to zero operating costs. The challenges, under the general heading of energy price decoupling, include suggestions for operating split markets possibly overseen by a regulator, and the prediction that marginal cost pricing should be abandoned. This review evaluates these in terms of their economic impact, relating them to the policy debates on electricity market reform.

Cointegration and causality relationship of Indian stock market with selected world markets

Background: The purpose of this study is to explore the trends and causes of established and emerging nations' stock market integration with India. The National Stock Exchange (NSE) indices act as a counterweight to international market indices. This study investigates the sustained interest of foreign investors in the Indian stock market in the wake of capital market reforms, as well as whether it moves in tandem with other markets in Asia and the United States. Methods: Our study examined the possibility of cross-country cointegration between the largest economies and indices around the world using multiple financial econometric models, such as Augmented Dickey-Fuller, Unit Root, Correlation, and Johansen Cointegration. Results: The findings of this study significantly support the notion that Indian and international financial markets are highly integrated. Vector error correction model indicates that the Indian market (NSE) is highly cointegrated with the US market (National Association of Securities Dealers Automated Quotations) and increased volatility signifies global contagion. Conclusion: A cursory examination of the data reveals distinct investment and portfolio diversification options for global investors. This could assist regulators in formulating more effective rules regarding price discovery processes.

Author Correction: Assessing the roles of efficient market versus regulatory capture in China’s power market reform

Author Correction: Assessing the roles of efficient market versus regulatory capture in China’s power market reform

Examining spatial market efficiency under different marketing regulations: The case of Turkish lemon markets

AbstractThis study evaluates spatial market and storage efficiency in Turkish lemon markets using switching regime (SR) and threshold autoregression models. Our sample period includes a crucial regulatory reform aimed at improving the performance of fresh fruit and vegetable markets, shortening the production‐consumption chain, and reducing retail prices. Using an extended SR model that allows for a gradual transition from the old to the new marketing regime, we test the hypothesis of no structural change in market efficiency and transaction costs in regional markets, including major consumption regions Istanbul, Ankara, and Izmir. Results indicate that the probability of efficient arbitrage regime is relatively higher in the post‐reform period, albeit there is still room for improvement. Extended SR models show no significant change in average transaction costs, while threshold autoregression models suggest a slight increase. Furthermore, spatial prices adjust more quickly in the post‐reform period, supporting relatively more efficient market functioning. While the regional markets seem to function more efficiently following the marketing reform, it has not led to permanent reductions in retail prices. Finally, our results from storage threshold autoregression models suggest that markets function reasonably efficiently, with no remarkable difference in storage behavior between the pre‐reform and post‐reform periods.

Announcement Effect Study of Issuing Tier 2 Capital Bonds on the Stock Price of China Construction Bank

Abstract This article uses event study methodology to empirically analyze the announcement effect of China Construction Bank's issuance of Tier 2 capital bonds. The results show that firstly, the announcement of the issuance of Tier 2 capital bonds has a positive impact on the stock price of China Construction Bank, with a positive abnormal return during the event study window. Secondly, the abnormal return is significantly higher from the 6th day to the 14th day after the announcement, indicating that the positive announcement effect occurs approximately one week after the announcement and lasts for one week. Based on these findings, policy recommendations are proposed: Firstly, China Construction Bank should choose an appropriate opportunity to issue Tier 2 capital bonds to achieve the goal of reducing capital costs and increasing the bank's market value. Secondly, regulatory authorities should strengthen supervision to prevent insider trading and enhance financial market reform. Thirdly, short-term investors can choose to buy after the announcement of the issuance of Tier 2 capital bonds by China Construction Bank and sell around 14 days after the announcement to obtain abnormal returns. Keywords: Tier 2 capital bonds, Announcement effects, China Construction Bank.

The theoretical understanding and strategic measures of the functional value of State-owned enterprises in the new era

The current global economic practice can tell us that national competition is the underlying structure of global market competition, innovation is the core factor to create the competitive power of dominant enterprises in the global market and dominates the global income distribution. However, when market competition will reshape the distribution pattern, the global market governance will fail. In this context, Chinese state-owned enterprises, due to their extensive layout and advantages, need to take greater responsibility in innovation and other aspects. To this end, we need to adhere to market-oriented reform, take core technological innovation as the key grasp, and fully follow the commercial orientation to give full play to the incentive compatibility role.

Is state-owned enterprise merging private enterprise “market choice” or “space crowding” ? —Based on the motives of equity transfer of mixed-ownership enterprises

Many state-owned enterprises have mergers and acquisitions (M&A) with private enterprises, which has caused private enterprises to worry about their living space being squeezed. Based on 572 data records about equity transfers of Chinese listed companies extracted from CSMAR4.0 from 2013 to 2020, this paper categorized ownership structures into three categories: privatization of state-owned enterprises (Category 1), state-owned enterprises merging private enterprises (Category 2), and state-owned enterprises merging state-owned enterprises (Category 3). The categorical regression of ex-ante equity transfer motivation revealed that the motives for Category 1 conformed to the phenomenon of the “pretty girl gets married first” and “embezzlement view.” Category In contrast, the motives for Category 2 conformed to the “fiscal revenue view.” The categorical regression of ex-post equity transfer motivation showed that all three types significantly improved various efficiencies and represented an optimal allocation of resources. Moreover, it was revealed that the transfer of equity to state-owned enterprises by inefficient private firms in Category 2 also significantly improved enterprise efficiency. Thus, it can be considered as a rational behavior of market selection and never squeezed the space crowding. Further analysis showed that the efficiency improvement is due to the symbiotic development relationship rather than the antagonistic relationship between heterogeneous shareholders. Therefore, it is suggested to initiate market-oriented reform by actively developing ownership mixed-ownership economy and adhering to the “two unwavering” basic economic system.