Restrictions In China Research Articles

Key links in network interactions: Assessing route-specific travel restrictions in China during the Covid-19 pandemic

We consider a model of network interactions where the outcome of a unit depends on the outcomes of the connected units. We determine the key network link, i.e., the network link whose removal results in the largest reduction in the aggregate outcomes, and examine a measure that quantifies the contribution of a network link to the aggregate outcomes. We provide an example examining the spread of Covid-19 in China. Travel restrictions were imposed to limit the spread of infectious diseases. As uniform restrictions can be inefficient and incur unnecessarily high costs, we examine the design of restrictions that target specific travel routes. Our approach may be generalized to multiple countries to guide policies during epidemics ranging from ex ante route-specific travel restrictions to ex post health measures based on travel histories, and from the initial travel restrictions to the phased reopening.

Key Links in Network Interactions: Assessing Route-Specific Travel Restrictions in China During the Covid-19 Pandemic

Key Links in Network Interactions: Assessing Route-Specific Travel Restrictions in China During the Covid-19 Pandemic

Government Speculation on Spillover Effect in the Housing Market: Quasi-Experimental Evidence from House Purchase Restrictions in China

Government Speculation on Spillover Effect in the Housing Market: Quasi-Experimental Evidence from House Purchase Restrictions in China

The effect of homeownership on migrant household savings: Evidence from the removal of home purchase restrictions in China

Internal migrants account for over one-fourth of China's population, and their saving behavior is important in explaining “the Chinese saving puzzle”. The relation between household savings and house prices has been studied, but this paper utilizes a quasi-experiment that removed home purchase restrictions to examine the causal effect of homeownership on migrant household savings through a difference-in-differences approach and instrumental variable estimation. We find that the migrant saving rate significantly decreases after migrants buy houses, falling below that of the local hukou population. Further analysis reveals that this effect of homeownership can be explained by the consumption effect rather than housing purchase or increased household income effects. Our findings imply that hukou-based policies, including the allocation of public goods and the right to buy private goods such as houses, will harm both migrant welfare and sustained economic growth.

Share‐loan pledging and relaxation of share‐repurchase restrictions in China

AbstractWe examine a period in which the in‐principle prohibition of share repurchases was relaxed in 2018 to allow for the repurchase of shares whose prices dropped materially or were below book value. We find that share‐loan pledges by controlling shareholders are significantly and positively associated with share repurchases for a sample of 3,531 Chinese firms. This finding is robust using entropy and propensity score matched samples, 2SLS IV regressions, regression discontinuity design (RDD), and two exogenous shocks (the China–US trade war in 2018 and the COVID‐19 pandemic in 2020). The association remains robust but becomes less strong with state ownership and with above industry average firm agency problems, leverage ratios and financial constraints/distress (i.e., other share repurchase motives). Our findings highlight the importance of financial market regulations on share‐loan pledging and share repurchases in emerging markets during periods of heightened firm‐specific and systemic margin call risk and impending liquidation of share‐loan pledges.

How effective is China's cryptocurrency trading ban?

Cryptocurrency trading is subject to strict government-imposed restrictions in China since September 2017, when trading platforms were shut down. Using a VAR-GARCH-BEKK model, we investigate the effectiveness of this trading ban by examining its consequences on the relationship between Chinese investors’ attention and Bitcoin. Our results demonstrate that Chinese investors played a dominant role in the Bitcoin price formation before the ban, and that their influence has not significantly decreased after the shutdown of Chinese trading platforms. Aiming to explain our findings, we provide strong evidence that the crackdown on Bitcoin trading has not been effective as Chinese investors continue to purchase Bitcoin using the stablecoin Tether instead of Chinese yuan.

Switching to electric vehicles can lead to significant reductions of PM2.5 and NO2 across China

Switching to electric vehicles can lead to significant reductions of PM2.5 and NO2 across China

Does non-fundamental news related to COVID-19 matter for stock returns? Evidence from Shanghai stock market

The COVID-19 outbreak generates various types of news that affect economic and financial systems. No studies have assessed the effects of such news on financial markets. This study sheds light on the impact of non-fundamental news related to the COVID-19 pandemic on the liquidity and returns volatility. Because we examined extreme events, we performed quantile regression on daily data from December 31, 2019 to the end of lockdown restrictions in China on April 7, 2020. Results showed that the non-fundamental news, as the number of deaths and cases related to the COVID-19, raised the stock market returns volatility and reduced the level of stock market liquidity, increasing overall risk, whereas fundamental macroeconomic news remained largely immaterial for the stock market. These findings are explained by a knock-on effect because the health system’s inability to manage and treat a high number of COVID-19 patients in intensive care led the country to implement a lockdown and the global economy to largely shut down.

Social media constraints and destination images: The potential of barrier-free internet access for foreign tourists in an internet-restricted destination

This study explores the effects of social media use constraints on destination image under the internet restrictions in China. The empirical results indicate that information search constraints have a significant effect on the affective image of destinations through emotional experience. Not allowing certain social media use has negative implications for tourists’ image of a destination through their emotional responses. Furthermore, there is a moderating effect of information search constraints on the relationships between emotion and affective image. The key findings appeal for policy breakthroughs on barrier-free internet access for foreign tourists in Hainan, China’s largest emerging free trade zone and one of its top tourist destinations. This has clear management implications for regions with internet restrictions.

Atmospheric Carbon Dioxide and Electricity Production Due to Lockdown

We analyzed real-time measurements of atmospheric carbon dioxide (CO2), with total electricity production and nationwide restrictions phases in China, the United States of America, Europe, and India due to the novel coronavirus COVID-19 pandemic and its effects on atmospheric CO2. A decline of 3.7% in the global energy demand at about 150 million tonnes of oil equivalent (Mtoe) in the first quarter (Q1) of 2020 was recorded compared to Q1 2019 due to the cutback on international economic activities. Our results showed that: (1) electricity production for the same period in 2018, 2019, and 2020 shrunk at an offset of 9.20%, which resulted in a modest reduction (−1.79%) of atmospheric CO2 to the 2017–2018 CO2 level; (2) a non-seasonal, abrupt, and brief atmospheric CO2 decrease by 0.85% in mid-February 2020 could be due to Phase 1 restrictions in China. The results indicate that electricity production reduction is significant to the short-term variability of atmospheric CO2. It also highlights China’s significant contribution to atmospheric CO2, which suggests that, without the national restriction of activities, CO2 concentration is set to exceed 2019 by 1.79%. Due to the lockdown, it quickly decreased and sustained for two months. The results underscore atmospheric CO2 reductions on the monthly time scale that can be achieved if electricity production from combustible sources was slashed. The result could be useful for cost-benefit analyses on the decrease in electricity production of combustible sources and the impact of this reduction on atmospheric CO2.

Modelling asset returns in the presence of price limits with Markov-switching mixture of truncated normal GARCH distribution: evidence from China

ABSTRACT This article proposes a general framework of a Markov Switching GARCH model with a mixture of truncated Gaussian to model asset returns with price limits in China. Theoretically, while retaining many convenient statistical properties of the Gaussian distribution, the proposed model also assumes a flexible time-varying volatility structure to accommodate the feature of the return data under price restrictions in China, such as the clusters near the bounds (due to the ‘bound effect’). Empirically, we apply the model to eight representative stocks from Shanghai and Shenzhen stock markets in China. Lastly, we find that our proposed model dominates the conventional volatility models in terms of Value-at-Risk measures.

Suboptimal declines and delays in early breast cancer treatment after COVID-19 quarantine restrictions in China: A national survey of 8397 patients in the first quarter of 2020.

BackgroundCancer patients had been profoundly affected by the outbreak of COVID-19 especially after quarantine restrictions in China. We aimed to explore the treatment changes and delays of early breast cancer (EBC) during the first quarter of 2020.MethodsWe did this retrospective, multicentre, cohort study at 97 cancer centres in China. EBC patients who received treatment regardless of preoperative therapy, surgery or postoperative therapy during first quarter of 2020 were included.Findings8397 patients were eligible with a median age of 50 (IQR 43–56). 0·2% (15/8397) of EBC patients were confirmed as COVID-19 infection. Only 5·2% of breast cancer diagnosis occurred after quarantine in Hubei compared with 15·3% in other provinces (OR= 0·30, 95%CI 0·24–0·38). postoperative endocrine therapy were least affected compared with different regions after quarantine (OR=0·37 [95%CI 0·19–0·73]). The proportion of surgery decreased from 16·4% in December last year to 2·6% in February in Hubei. Compared with intervals from diagnosis to treatment before quarantine restrictions, the average time increased with significance from 3·5 to 7·7 days in Hubei and 5·7 to 7·7 days in other provinces (p< 0·001). There were also 18·5 and 7·2 days delay in Hubei and other provinces respectively when calculating interval from surgery to postoperative therapy.InterpretationEBC from high risk regions had a comparative rate of COVID-19 infection. After implementation of COVID-19 quarantine restrictions, fewer diagnosis and surgery with significant delays were seen when compared with treatment before.FundingBeijing Medical Award Foundation (YJ0120)

Impact of COVID-19 pandemic on clinical and surgical breast cancer management.

Impact of COVID-19 pandemic on clinical and surgical breast cancer management.

Temporary driving restrictions, air pollution, and contemporaneous health: Evidence from China

We employ a temporary policy of driving restrictions in China to estimate the effect of traffic control on pollution. We then evaluate the health impact of pollution using the fixed effects instrumental variables approach. We show that the policy significantly improves the city-level air quality as measured by CO, PM10, NO2, and API. The further station-level analysis displays that the effect substantially declines from 46.6% to 33.1% for CO and PM10 respectively to 14.5% and 18.3% with the decreasing size of the restriction area. Furthermore, we demonstrate the heterogeneous impact on PM10 by road density. We then find that a 1% decrease in PM10 reduces the daily air-pollution-related standardized mortality by 0.313 per million people. The heterogeneity analysis indicates that the impact is largely driven by the females at the age of 65 years and older.

Effects of house-sale restrictions in China: a difference-in-difference approach

ABSTRACTChinese housing prices have increased rapidly in recent years. Concerned about the potential for a burst bubble, the Chinese government has been intervening in the market to rein in the rising price trend since 2010. In March 2017, a new housing policy, called house-sale restriction, was developed to curtail speculation in the Chinese housing market. This study uses a difference-in-difference model to examine the policy effect of this new restriction. By using house-sale and price data of 43 cities across 30 provinces in China, we find that house-sale restrictions could effectively reduce speculation in the market as well as decrease housing prices in the short term. This study analyses only the short-term effect of this new housing policy; the long-term effect requires further examination.

Effectiveness of policy incentives on electric vehicle acceptance in China: A discrete choice analysis

The Chinese Government has introduced numerous policy incentives to promote the development and adoption of electric vehicles (EVs), especially aggressive subsidization policies. Stimulated by such policies, sales of EVs exceeded 500,000 in 2016. However, the subsidies for EVs will be abrogated after 2020. In order to maintain market stability, the EV-related policy system needs innovation. Nonetheless, it is still unclear how effective different policy incentives are.By conducting a discrete choice experiment involving 247 respondents and using a mixed logit model, this paper investigates the effectiveness of several potential policy incentives except subsidization policies, as well as the influence of socio-psychologist determinants. The results help to offer suggestions for the EV-related policy reformation.As expected, the probability of stated EV-acceptance increases if policy incentives are provided in the choice experiment. EVs are exempted from purchase restrictions (license plate control policy) and driving restrictions in China, and these two transport policy incentives have the most significant positive effects on the EV-acceptance. Discounted/free electric charging also has great contribution. Preferential bus lane access gains increasing attention. Vehicle purchase tax exemption should be resumed because of its positive influence. Comparatively speaking, the financial incentives (e.g., reduced parking fees) in the EV using stage play a weaker role.

Intraday price information flows between the CSI300 and futures market: an application of wavelet analysis

This study investigates linear and nonlinear price information flows between the Chinese Stock Index 300 (CSI300) and futures market using high-frequency data and their wavelet transformed series for three regimes for which stock short-selling restrictions in China are different. Empirical results generally indicate information feedback between these two markets regardless of assumptions of linear and nonlinear causality and regimes for original series and wavelet transformed data at different scales.

Mapping the global flow of tungsten to identify key material efficiency and supply security opportunities

Tungsten is an economically important metal with diverse applications ranging from wear resistant cutting tools to its use in specialized steels and alloys. Concerns about its supply security have been raised by various studies in literature, mostly due to trade disputes arising from supply concentration and exports restrictions in China and its lack of viable substitutes. Although tungsten material flows have been analysed for specific regions, a global mass flow analysis of tungsten is still missing in literature and its global supply chain remains opaque for industry outsiders. The objective of this paper is to create a map of global tungsten flows to highlight and discuss key material efficiency (i.e., using less of a material to make a product or supply a service, or reducing the material entering production but ending up in waste) and supply security opportunities along tungsten’s supply chain that could be incorporated into the planning and prioritization of future supply security strategies. The results indicate the existence of various intervention alternatives that could help to broaden the supply base and improve the overall material efficiency of the system. In particular, future policy and research and development (R&D) efforts to improve tungsten’s material efficiency should focus on minimizing tungsten losses as fine particles during beneficiation and extraction (current global losses estimated at 10–40%), as well as on evaluating alternatives to improve recycling collection systems and technologies, which could lead to 17–45% more tungsten discards being recycled into new products.

The Political Economy of Inward FDI: Opposition to Chinese Mergers and Acquisitions

A great deal of political economy scholarship has focused on how countries can attract foreign direct investment (FDI), and the effects of FDI on growth and political stability. A related topic that has received almost no attention, however, is that of divergent political reactions to inflows of FDI in the countries receiving investments. This is an oversight, because inward FDI flows are not equally welcomed by the host country and, in fact, often encounter strong political opposition. We study this phenomenon by examining political opposition to attempts by Chinese companies at mergers and acquisitions (M&As) with US firms. This is especially important given rapidly expanding Chinese M&A activity. We hypothesise that although most legal barriers to foreign M&As are based on national security considerations, objections on these grounds are often vehicles through which to channel other grievances, and that economic distress and reciprocity are also key drivers of political opposition. To test this theory, we constructed an original dataset of 569 transactions that occurred between 1999 and 2014 involving Chinese acquirers and American targets. We find that there is more likely to be opposition to Chinese M&A attempts in security sensitive industries, economically distressed industries, and sectors in which US companies faced restrictions in China’s M&A markets.

Institutional Trading and Stock Returns: Evidence from China

Using a unique dataset containing daily institutional ownership information, we examine the relation between daily institutional trading and past, contemporaneous, and future stock returns on the Shanghai Stock Exchange (SSE). We find strong evidence of the price pressure effect induced by institutional trading, causing price impacts of up to 2.12% per day for the most intensively bought stocks. We further find that institutions are informed and momentum traders when buying but not when selling, which may be due to short-selling restrictions in China. Finally, our findings suggest that institutions engage in order splitting and/or herding behavior, as the price pressure effect is observed up to five days before and after the intense trading date.