Opening-up Policy Research Articles

Revisiting the “Guns versus Butter” Argument in China (1950–2014): New Evidence from the Continuous Wavelet Analysis

The long-lasting “guns versus butter” argument reflects the fact that China has been experiencing a difficult choice in terms of improving the defense and social welfare sectors, and thus achieving fiscal sustainability. The result, however, is controversial. The present paper therefore re-examines the relationship between defense and social welfare by employing continuous wavelet analysis during a long period of 1950–2014 in China. We focus in particular on their dynamic correlation and the lead-lag relationship across different frequency bands. Our results clearly show the inexistence of the crowding-out effect between defense expenditure and social welfare; moreover, the increase in defense (social welfare) expenditure could stimulate the expansion of social welfare (defense) spending. In addition, we find a positive relationship between defense and social welfare with defense leading during 1961–1968 in the short term, when China suffered from the economic breakdown and the social turbulence caused by the Great Famine, Sino-Soviet border conflict, etc. Notably, social welfare also led the progress in defense during 1984–1988 and 1995–1998 in the medium and long terms by the further deepening of the opening-up policy and enforcing the economic system reform.

China’s Rise and its Discursive Power Strategy

It is increasingly evident that China has attached more attention to discursive power in foreign policy since the early 21st century. Both top leaders and government agencies have been active in advocating for a new discourse on various international occasions. Previously, China has been reluctant to join the debate in international affairs, and been instead preoccupied with domestic affairs since the late 1970s. The situation has changed since 2009 because of China’s rapid rise to become the world’s second largest economy. With regard to the motivations behind the Chinese government’s support for discursive power, the dominant explanation is based on the “rise of China” argument. However, this argument does not explain the causal relationship between China’s rise and its discursive power strategy. So, this paper aims to clarify the motivation behind China’s discursive power strategy through document reviews and interviews with mainstream scholars. It concludes that a discursive power strategy has been the fundamental principle of the Communist Party of China since its establishment in 1921. Since China’s adoption of an opening-up policy in 1978, this tradition has been suppressed but not eliminated entirely by top leaders. As China continues to rise on the world stage, the principle will drive China to create a new political model rather than be a mere follower of the established political order.

Chinese Divisia Monetary Index and GDP Nowcasting

Since China’s enactment of the Reform and Opening-Up policy in 1978, China has become one of the world’s fastest growing economies, with an annual GDP growth rate exceeding 10 % between 1978 and 2008. But in 2015, Chinese GDP grew at 7 %, the lowest rate in 5 years. Many corporations complain that the borrowing cost of capital is too high. This paper constructs Chinese Divisia monetary aggregates M1 and M2, and, for the first time, constructs the broader Chinese monetary aggregates, M3 and M4. Those broader aggregates have never before been constructed for China, either as simple-sum or Divisia. The results shed light on the current Chinese monetary situation and the increased borrowing cost of money. GDP data are published only quarterly and with a substantial lag, while many monetary and financial decisions are made at a higher frequency. GDP nowcasting can evaluate the current month’s GDP growth rate, given the available economic data up to the point at which the nowcasting is conducted. Therefore, nowcasting GDP has become an increasingly important task for central banks. This paper nowcasts Chinese monthly GDP growth rate using a dynamic factor model, incorporating as indicators the Divisia monetary aggregate indexes, Divisia M1 and M2 along with additional information from a large panel of other relevant time series data. The results show that Divisia monetary aggregates contain more indicator information than the simple sum aggregates, and thereby help the factor model produce the best available nowcasting results. In addition, our results demonstrate that China’s economy experienced a regime switch or structure break in 2012, which a Chow test confirmed the regime switch. Before and after the regime switch, the factor models performed differently. We conclude that different nowcasting models should be used during the two regimes.

Innovation as a Multiplier to China's Economic Development

An age long ago for about 5 decades to date, China’s long-term economic growth outlook has placed this giant indisputably on the global economic platform as one of the fastest geometrically growing emerging markets and the second largest economy in the world to that of USA and has gone through several sound policy reforms for addressing the needs of self sufficiency for better standard of living, sustainable human livelihood and socio-economic expansion for effective, efficient and secured global competitiveness. This has placed China in the centre stage as one of the giant in the world being the fastest growing economy, largest trading partner and one of the world’s core exporter of capital with an average real GDP growth rate of about 6.7% as at the of the 1st quarter 20161. Academic scholars and researchers have been laying more premiums with the notion that the core stimulant of Chinese economic development includes but not limited to; technological enhancement, capital investment expansion, huge input of resources with a committed and relatively abundantly cheap labour forces. Albeit to this fact, policy makers and regulators are of the strong conviction that that innovation activity is the multiplier of the prowess of economic prosperity and empowerment double also as a pre-requisite in meeting global challenges in domains without clearly reflecting the complementary role of innovation played in transforming China's economic development. This is a Concept paper to identify the different strata of innovation patterns existing in China’s economic space with a reflection to the great importance of its eminent role played in the developmental trend over the past 30 years highlighting the “reform strategies and opening-up policy” constituting; Institutional, Technological, Incremental and Integration Innovation and the list goes on. China’s economic transition with the current “New Normal model and the one Belt-Road Initiative” readily needs sound, quality and tradable Innovative ideas for a sustainable and meaningful economic development. The research finding would serve as a bedrock specification as a proxy to by macroeconomic policy analyst and regulators for enforcing and enriching innovation as a multiplier to sustainable economic development in China.

China’s Rise and Its Discursive Power Strategy

It is increasingly evident that China has attached more attention to discursive power in foreign policy since the early 21st century. Both top leaders and government agencies have been active in advocating for a new discourse on various international occasions. Previously, China has been reluctant to join the debate in international affairs, and been instead preoccupied with domestic affairs since the late 1970s. The situation has changed since 2009 because of China’s rapid rise to become the world’s second largest economy. With regard to the motivations behind the Chinese government’s support for discursive power, the dominant explanation is based on the “rise of China” argument. However, this argument does not explain the causal relationship between China’s rise and its discursive power strategy. So, this paper aims to clarify the motivation behind China’s discursive power strategy through document reviews and interviews with mainstream scholars. It concludes that a discursive power strategy has been the fundamental principle of the Communist Party of China since its establishment in 1921. Since China’s adoption of an opening-up policy in 1978, this tradition has been suppressed but not eliminated entirely by top leaders. As China continues to rise on the world stage, the principle will drive China to create a new political model rather than be a mere follower of the established political order.

Ecological Security Pattern Analysis Based on InVEST and Least-Cost Path Model: A Case Study of Dongguan Water Village

The famous “world’s factory” city, Dongguan, like many other places in China, is a typical beneficiary of China’s Reform and Opening-up Policy. However, rapid urban sprawl and economic growth are at the expense of the destruction of the local environment. Therefore, it is of great importance to establish an ecological security network for sustainable development. InVEST models, effective tools to measure sensitivity and intensity of external threats to quantify habitat value, are used to calculate habitat quality of water and land. By combining structural connectivity and the Least-Cost Path model (LCP model), in which corridors are determined based on the minimum accumulative cost path between each critical point, ecological security patterns were calculated. According to the results, the northwest region of Dongguan, having a large quantity of farmlands and water and therefore many corridors and critical patches, is the most essential area in the overall security of ecological environments, which should be protected first. If developed, it should be dominated by eco-tourism and eco-agriculture. We hope that research on the ecological network, which includes critical patches and corridors formed by greenland and rivers, will lead toward better-informed proposals for local urban planning and regional sustainable development.

China’s Embrace of the UN Post-2015 Development Agenda

Since the 1990s, the United Nations has issued three agendas for global development cooperation. China’s attitude toward these agendas has also undergone three phases: from cautious passivity at first, to active yet restrained involvement, and to fully embracing them. On January 1, 2016, the Sustainable Development Goals (SDGs) replaced the Millennium Development Goals (MDGs) as the primary goals for global development cooperation in the next 15 years. But there are substantial differences between the SDGs and MDGs, which will inevitably exert significant impacts on China’s domestic development and its involvement in international cooperation. In its response, China should carefully examine its strengths and constraints before making a comprehensive national strategy for sustainable development, so as to advance domestic structural reforms and facilitate its commitment to the implementation of the SDGs. Meanwhile, China should actively push forward international collaboration in line with its opening-up policy, including South-South and South-North cooperation, as well as new mechanisms for trilateral cooperation. All these efforts will contribute to the establishment of new global partnerships for common development and the fulfillment of the SDGs.

An Analysis Summary of Factors Affecting China’ Assembled Funds Trust Products’ Expected Return Rate

Since China’s reform and opening-up policy, China’s national wealth has increased a lot, which stimulates the rapid development of China’s trust industry. Among them, the assembled funds trust plan attracts a large number of investors for its high returns. In this background, this paper discusses the factors affecting China’ assembled funds trust products’ expected return rate. This paper will explain the expected return rate of assembled funds trust under nine explanatory variables, including four dummy variables of investing field, namely real estate, industrial & commercial enterprises, basic industries and financial products; two features of assembled funds trust products, which include three factors namely trust period, the trust scale, macro-economic factors; CPI growth rate, M2 growth, benchmark interest rates of the medium-& long-term loan interest rate. The author establishes a multivariate regression model after empirical analysis. According to the empirical results, five explanatory variables including the longer period of the trust, the trust scale, investment field in real estate, CPI growth rate and the benchmark interest rates of the medium- and long-term loan interest rate, have a positive relationship with explained variable, namely the assembled funds trust products’ expected return rate. Investing in basic industries, financial products and M2 growth rate over the same period of last year, all these three elements have a negative relationship with assembled funds trust products’ expected return rate. While investing in industrial & commercial enterprises, it has no significant influence on the assembled funds trust products’ expected return rate.

改革开放以来中国共产党人扶贫思想研究述评

贫困是世界各国尤其是发展中国家普遍面临的一个难题。对现今正处于全面建成小康社会的关键时期和攻坚阶段的中国而言，该问题的解决显得更为重要和迫切。从时间、空间、研究对象等方面对改革开放以来中国共产党人的扶贫思想进行系统梳理，可以使我们能对过去的扶贫经验和不足有一个较为全面的认识和把握，在此基础上，进一步改进和完善当前国家的扶贫政策，以期能够早日实现全部人口的脱贫，进而如期实现全面建成小康社会的目标。 Poverty is the universal problem that must be faced by the whole world, especially for the devel-oping countries. As for China, who is now in a critical period and a crucial stage of build a well-off society in an all-round way, the problem is more important and urgent. Studying the Chinese communists’ thoughts on poverty alleviation system from the aspects such as time, space, and study object of study since the reform and opening-up policy can make us have a more comprehensive understanding and grasp the past experience and insufficient for poverty alleviation. On this basis, further improving and perfecting the current national policy for poverty alleviation are helpful to make the whole population get rid of poverty and build a well-off society in an all-round way.

CHINESE PEACEFUL RISE AND DEVELOPMENT. THE THEORY OF “CHINA’S THREAT”

People’s Republic of China (PRC) has achieved phenomenal economic growth and unprecedented development “miracle” in human history. From the middle of the first decade of this century China has become a significant player in the global economy, it has flourished into a formidable economy, ranked the second largest in the world, and stands as the largest, the fastest growing and the most heavily engaged in international business and investment. The sustained and rapid growth of China’s economy, since the late 1970s, initiated by Deng Xiaoping (8 March 1978 - 17 June 1983), driven by reform and opening-up policy, became one of the most important milestones of the global economy during the past quarter century. The reform and opening up has enabled China to complete the historic transformation from a semi-closed society into a fully open one. Today, the openness of Chinese society and its integration with the outside world have reached unprecedented levels. The consequence of integration into the global economy, economic development has made China into a major force and advocate of globalization. China has become the strategic center of the “global factory” that produces the commodities consumed globally, above all in the centers of global capitalism.

The Garment Industry in South China

Since the implementation of China’s economic reform and opening-up policy at the end of the 1970s, garment manufacturing for both the domestic and global markets has developed and proliferated quickly in Guangzhou-centred South China. It is believed to be the result of the industrial restructuring of the global apparel commodity chain and a large domestic consumer demand from the Chinese people. Compared with other industries, the garment industry has long been subject to the strong impact of a transitional market economy and, more recently, the increasingly rapid process of marketisation in China. In order to provide a clear sociological conceptualisation of the market economy in the reform era, this paper aims to apply the relational work approach to analysing economic transactions in the garment business, particularly business dealings between garment producers and wholesalers. The focus is on their continued efforts to make appropriate economic arrangements in accordance with specific sets of social relations through continuous relational work. This paper will examine three categories of relational work and the associated economic forms in the making. First, it will explore families and the household economy; second, it will examine relatives and friends and the favour-based economy; and third, it will study strangers and the market economy. Through the use of this relational work framework, this paper will shed light on how the different sets of relational work help us to understand relationships and embeddedness between garment producers and wholesalers in China’s rapidly evolving garment economy.

Legal Protection of the Right to Old-Age Insurance for Migrant Workers from Rural Areas in China

China’s main comparative advantage in international competition is its cheap labour, mostly migrant workers from rural areas. Migrant workers play an important role in the economic development of China. Since 1978 when China began to adopt the reform and opening-up policy, more and more migrant workers have poured into cities and towns to seek better employment opportunities. However, besides low wages, they have to endure long working hours and dangerous working environments. In addition, many employers do not contribute social insurance for migrant workers at all, leaving them vulnerable to unexpected living costs. According to a survey conducted in the Yangtze Delta Region by the Legal Aid Program for Migrant Workers at Nanjing University in August 2009, only 39.3 per cent of migrant workers have pension schemes, and 31.5 per cent of migrant workers have not joined any social insurance schemes of any sort. In some cities such as Wenzhou, even fewer are covered, as only 15.4 per cent of migrant workers have a pension scheme and 50 per cent of migrant workers have not joined any social insurance scheme. When migrant workers become old, sick, unemployed or injured in industrial accidents, they fall into poverty because they cannot apply for social insurance benefits. Among these problematic issues, old-age insurance should be specifically highlighted because more migrant workers are reaching their retirement age. There has been an increasing number of pension cases filed at the courts of law. However, many courts refuse to proceed with the hearings of these social insurance cases, or apply inappropriate legal doctrines in the trial process. It is also almost impossible for migrant workers to get legal redress for their pension benefits when their employers fail to comply with the law and contribute fees for them. It is imperative for the Chinese government to unify the old-age insurance system countrywide.

Challenges facing China and harmony as a state strategy

After its defeat in the Opium Wars, China was drawn into the orbit of Western influence. Since then, dewesternization has always been one of the hotly debated topics among Chinese intellectuals and politicians. With the implementation of the reform and opening-up policy in 1978, China’s economic take-off was almost instant due to its low-cost labor, rich resources, and the government’s firm resolution to modernize. The booming of a market economy with Chinese characteristics can be quoted as a success story of China’s dewesternization project. However, while enjoying the benefits of its attempts to modernize itself, China also begins to encounter the dark side of modernity. Problems like environmental deterioration, the widening gap between the rich and the poor, and food safety are causing anxieties among Chinese people. In order to cope with the detrimental effects of the neo-liberal doctrines, harmony was put forward as a state strategy. Ostensibly disinterested, harmony aims at the well-being, happiness, and welfare of all. However, while harmony can serve as a national strategy to ameliorate the fermenting social discontent in China, it may also be a lofty ideal to attract, unite, and inspire people in other parts of the world. According to the spirit of harmony, different nations can pursue the well-being of their own people in their own ways which is in accordance with the notion of pluriversality as proposed by decolonial thinkers. Besides analyzing the social, economic, and political significance of harmony both within China and abroad, this essay also attempts to address the theoretical problems posed by harmony, if it is to be considered a productive ideal in this globalized world.

Empirical study on the environmental pressure versus economic growth in China during 1991–2012

Since adoption of the policy of reform and opening-up in 1978, China has achieved spectacular success in economic growth, which mainly driven by abundant consumption of natural resources and resulted in serious environmental problems. Based on Emergy approach and Rescaled Range analysis, this paper aims to examine the decoupling condition in economic growth nexus environmental pressure both at specific and aggregate level and track the changing trend and the corresponding socio-economic cost in decoupling process. The results show that: the decoupling performance of waste emission (includes waste water, SO2 and solid waste) is better than energy consumption at a specific level which implies that the policies focused on end-of-pipe treatment has been succeeded in meeting the targets of emission reduction. But at aggregate level, the situation is opposite which suggest that China need more efforts in life-cycle management. The weak decoupling condition of resource use and waste water discharge may continue in the future, so as the strong decoupling condition of SO2 and solid waste, but for the aggregate environmental pressure induced by waste emission, the decoupling performance may be getting worse in the future. The investment cost of decoupling increased, whilst the job-cost of decoupling decreased. The decoupling performance can be influenced by environmental policies substantially, such as the polices of circular economy, rigorous emission reduction and waste recycling which have brought about the strong decoupling of SO2 emission and solid waste discharge from economic growth, whereas the less rigorous policies on resource exploitation and waste water discharge didn’t achieve the same result. Therefore, China needs to intensify the unity among various environmental policies.

Social Governance of China: Problems and Solutions

The reinforcement of social governance is an important segment of the harmonious society construction of China. Since the reform and opening-up policy, the social governance of China has gotten a serious of momentous achievements. But it still faces some problems. In the next step of work, those measures should be taken to continuously advance the social governance innovation of China such as ameliorating the system and mechanism of social governance, perfecting the talent training system and strengthening the top-level design.

Reality and Dilemma: The Development of China's Sports Industry since the Implementation of the Reform and Opening-Up Policy

This paper explores the history and development of China's sports industry, along with its achievements, prospects, problems, and dilemmas, beginning with the implementation of the reform and opening-up policy. The paper concludes that China's sports have been gradually transformed from a type of public welfare under the planned economy to a business under the market-oriented economy since the implementation of the reform and opening-up policy in 1978. China's sports industry has gone through three stages, i.e. the exploratory stage (1978–1992), the formative stage (1993–1996), and the development stage (1997–present), and has achieved remarkable progress since the reform and opening-up. This has made the sports industry a new and significant economic growth point in China, constituting a sunrise industry of the twenty-first century. Despite the huge potential, the further development of China's sports industry is still faced with a series of problems and dilemmas, such as its unbalanced development, the lack of independent innovation, shortcomings in the policies and regulations of the industry, and the poor management system(s).

On the formulation of TCM foreign exchange policy after the reform and opening-up

The foreign exchange activities of traditional Chinese medicine are conducted under the guidance of the policy of the CPC and Chinese government. After the carrying out of the reform and opening-up policy, foreign exchange policy of TCM has experienced the process of growing up from nothing, from less to more, and from coarse to fine, which is closely related to our country's foreign policy, the cause of Chinese medicine development, and urgent need of international communication. In the three decades after the reform and opening-up policy, the formulation of foreign exchange policy of TCM can be divided into three stages: viz., inclusion in the framework of national foreign policy (1978-1985), embodiment in the policy of developing TCM cause (1986-1996), and appearance in the special policy of foreign exchange of Chinese medicine (since 1997). From the development process of these policies, the development of each policy gradually complies with the process of the development of the times, with its contents basically in line with the requirements of the times. The implementation of some policies promotes the foreign exchanges and cooperation of Chinese medicine.

Sources of Political Support for China’s Reformation: Political Socialization of Working Class in Transitional China

Abstract The popular political support has been considered as the Governing Foundation of CPC, as the important guarantee for modern state building and state governance. While the acquisition of political support is not easy, CCP utilized kinds of tactics to get the political support from the above at the beginning of the reform. Meanwhile, adapting to the change of the public’s political psychology, CCP adjusted timely the political socialization strategies in order to acquire the political support from the lower class, especially the working class. This paper investigates the sources of political support for the economic reform by the analysis of the political socialization strategies during the socialism market economy reform. The core point is that the relative smooth triple transition in China not only relies on the tremendous economic growth via the strategic opening-up policy and the resulting ruling effectiveness, but also depends on the political identity and support from the workers through the role of political socialization. Keywords: political support – CCP – China – economic reform ----- Bibliography: Hongna, Miao: Sources of Political Support for China’s Reformation: Political Socialization of Working Class in Transitional China, PCS, 1-2014, pp. 45-60. https://doi.org/10.3224/pcs.v5i1.19818

Analysis of the Risk Factors on Chinese Korean Migration

Since the fifth population census, the number of Chinese Korean population has declined for more than 10 years.And the number of Chinese Korean at their main settelments in northeast of China has declined for more than 20 years.The main reason for the phenomenon of Chinese Korean population`s negative growth is migration.Domestic migration leads to the decline of Chinese Korean population in northeast of China, and cross-border migration gives rise to the negative growth of Chinese Koreans allover of China. Chinese Korean migration affected the economic and society of their settelments. Many Chinese Koreans went to the coastal cities of China after the reform and open-up policy, and the number of Chinese Korean women who married with Koreans is increasing. The data sources of this paper are population census data and a survey concerning the migrated population conducted in minority areas in 2012 by ChineseNational Population and Family Planning Commission.We analyze the risk factors through descriptive statistical analysis and Logistic regressions. The results suggest that the risk of female migration is higher than male; the main migrants focus on the ages of 31-50;the migration tendency of single people is greater than people have married; Migration tendency increase with educational degree;population with medium educational degree prefer cross-border migration, and people with high educational degree prefer migration in domestic;migration tendency of people with agriculture household is higher than non-agriculture.

The Crowding-out Effects of Chinese Tourists on Inbound Tourism in Taiwan

This study conducts multiple regression analysis to establish a forecasting model for the number of inbound tourists to Taiwan from different countries. Monte Carlo simulation is used to forecast the number of inbound tourists to Taiwan from different countries and to evaluate whether the opening-up to Chinese tourists has a crowding-out effect on tourism demand. The empirical results indicate that, except for Australia and the UK, the inbound tourists from the sampled countries suffered from varying degrees of crowding-out effect as a result of Taiwan's opening-up to Chinese tourists. This is particularly noticeable with tourists from Korea, Singapore and the USA. In terms of regional effects, Asia is the most affected by the opening-up policy, while Europe and Oceania are less affected. However, the number of inbound tourists from different countries has not dropped, but shows an upward trend.