ECONOMIC GROWTH AND CYCLES IN MODERN CHINA

If the theory of cyclical fluctuation can be applied to modern China, the economic development ofChina in this period can be seen as consisting of several stages. At each stage as well as in the wholeperiod, chosen index system is likely to help measure the growth rate. By vertical and horizontal com-parison, this paper will try to settle the disputes on China’s modern economic development.

China＇s Economic Growth Cycles over the Past 60 Years and the Current New Cycle

This paper first summarizes China＇s economic growth rate fluctuations over the past 60 years since 1949 and examines the new developments in China＇s economic structure behind these fluctuations since reform and opening-up in the late 1970s.In tackling the global financial crisis,China is embracing a new economic cycle and must draw upon its economic history to prolong the upward momentum in the new cycle.To do so means maintaining an appropriate growth rate in the new cycle.This paper also analyzes the importance urbanization and the housing sector will play in the new cycle and how to address rising housing prices.

Analyzing Industrial Structure Evolution of Old Industrial Cities Using Evolutionary Resilience Theory：A Case Study in Shenyang of China

The recession and revitalization of old industrial cities concerns urban industrial evolution and its characteristics. Based on the theory of evolutionary resilience, we developed an analytical framework for the industrial structure evolution of old industrial cities, and applied the framework to a case study in Shenyang. The following conclusions are drawn. First, since 1978, Shenyang's industrial growth capacity has shown fluctuation between ‘contraction-expansion'. As the secondary industry has a much stronger expansionary and contractionary capacity for growth, this results in lacking stability leading to industrial structure transformation. Second, since 1999, the orientation towards a high-end manufacturing industry in Shenyang has weakened, and the evolution of the new and old growth path is characterized by low-end orientation. Third, since 2007, Shenyang's industrial innovation output capacity has dropped sharply which has been significantly affected by scientific and technological personnel and enterprise-owed science and technology institutions and to a less extent by R&D expenditure. We applied the resilience theory to study the industrial evolution of an old industrial city, explored new study perspectives on industrial evolution and verified the applicability of the resilience theory. This paper provides a scientific reference for understanding the recent deceleration in economic growth in the Northeast old industrial base, and for exploring new paths toward revitalization.

Peculiarities of Innovative Development of Economy in Georgia

Under the global economy,classical economic doctrines cannot reflect every aspect of the country’s economic competitiveness as non-traditional factors of economic development play an equally important role in achieving the country’s economic goals.In the view of the mentioned,knowledge and innovation are essential factors of economic development at the present stage.Consequently,at the present stage,in the process of global competitiveness,the study of innovative economics as a factor of self-establishment is also relevant for the countries with limited natural resources.Thus,the urgency and necessity of researching the existing issue are conditioned by the complex study of the existing economic,political,and institutional factors.Despite theoretical estimates,in the Georgian economic literature today there is practically no comprehensive research and analysis on the opportunities for the development of innovative economics in the country,on the basis of which the formation of the innovative economics should be carried out in Georgia.The goals of the research are to study and analyze the potential and role of Georgia’s opportunities for the development of innovative economics and to determine its impact on the economic development of the country in the process of integration of the modern global economy.

Importance of Balance Sheet Composition in Stress Test Estimates

The stress tests are based on macroeconomic variables for the estimations of the results.However,there are other factors that may influence them.This paper studies the influence of the balance sheet structure in the NPL and the loss caused by the NPL using econometric models.The objective is to research how they affect the aggregates in the balance sheet to the delay in payment and the the provision for impairment,distinguishing these effects according to the economic cycle,so that can be applied to the stress test.The results show that the Balance sheet structure is important in delinquency and losses caused by it,especially in respect of stockholders'funds,ECB resources and the account Non-current assets held for sale.It also highlights the influence of the economic cycle and the different behavior of the NPL and the losses due to default with respect to the same explanatory variables.

Common Prosperity and Reshaping China's Economic Cycle: Theoretical Logic and Empirical Evidence from a Political Economic Perspective

Fostering a new development dynamic is in nature about reshaping the relations between domestic and international economic cycles to achieve self-reliance and self-strengthening at higher levels.Economic cycle is the integration of various links such as production,distribution,exchange and consumption.This paper attempts to study the influence on economic cycle from income distribution based on the principles of political economy and therefore link common prosperity with the new development dynamic.It finds that labor income share is central to income distribution.On the supply side,income distribution affects choice of technology and production eficiency through changing wages;on the demand side,it influences size of demand and level of capacity utilization both directly and indirectly.Specifically,changing wages lead to changing size of reproduction and consumption by laborers in the direct way and cause changing profit margins and thus affect accumulation in the indirect way.The two channels produce effects simultaneously,yet in opposite directions,which justifies the categorization of economies into"profit-oriented"and"wage-oriented"ones according to the different influence of changing wages on the level of capacity utilization.In this theoretical logic,the paper comprehensively analyzes China's income distribution,wages,all labor productivity,organic composition of capital,profit margins,accumulation rates,level of capacity utilization and relations between domestic and international economic cycles,and finds that Chinese economy has turned from"profit-oriented"to"wageoriented"since the turning point of 2010.It signals both necessity and feasibility of promoting common prosperity and fostering a new development dynamic.This paper also proposes some policy suggestions on promoting common prosperity from the perspectives of ownership,distribution,government-market relations and spatial structure.

Information Models for Forecasting Nonlinear Economic Dynamics in the Digital Era

The aim of this study was to develop an adequate mathematical model for long-term forecasting of technological progress and economic growth in the digital age (2020-2050). In addition, the task was to develop a model for forecast calculations of labor productivity in the symbiosis of “man + intelligent machine”, where an intelligent machine (IM) is understood as a computer or robot equipped with elements of artificial intelligence (AI), as well as in the digital economy as a whole. In the course of the study, it was shown that in order to implement its goals the Schumpeter-Kondratiev innovation and cycle theory on forming long waves (LW) of economic development influenced by a powerful cluster of economic technologies engendered by industrial revolutions is most appropriate for a long-term forecasting of technological progress and economic growth. The Solow neoclassical model of economic growth, synchronized with LW, gives the opportunity to forecast economic dynamics of technologically advanced countries with a greater precision up to 30 years, the time which correlates with the continuation of LW. In the information and digital age, the key role among the main factors of growth (capital, labour and technological progress) is played by the latter. The authors have developed an information model which allows for forecasting technological progress basing on growth rates of endogenous technological information in economics. The main regimes of producing technological information, corresponding to the eras of information and digital economies, are given in the article, as well as the Lagrangians that engender them. The model is verified on the example of the 5th information LW for the US economy (1982-2018) and it has had highly accurate approximation for both technological progress and economic growth. A number of new results were obtained using the developed information models for forecasting technological progress. The forecasting trajectory of economic growth of developed countries (on the example of the USA) on the upward stage of the 6th LW (2018-2042), engendered by the digital technologies of the 4th Industrial Revolution is given. It is also demonstrated that the symbiosis of human and intelligent machine (IM) is the driving force in the digital economy, where man plays the leading role organizing effective and efficient mutual work. Authors suggest a mathematical model for calculating labour productivity in the digital economy, where the symbiosis of “human + IM” is widely used. The calculations carried out with the help of the model show: 1) the symbiosis of “human + IM” from the very beginning lets to realize the possibilities of increasing work performance in the economy with the help of digital technologies;2) the largest labour productivity is achieved in the symbiosis of “human + IM”, where man labour prevails, and the lowest labour productivity is seen where the largest part of the work is performed by IM;3) developed countries may achieve labour productivity of 3% per year by the mid-2020s, which has all the chances to stay up to the 2040s.

Procyclicality of Local Government Debt Financing and Its Theoretical Explanation

This paper aims to examine the dynamic characteristics of local government debt in the economic cycle and to explore the reasons.Using the provincial panel data from 2002 to 2014 and system GMM,this paper finds that the accumulation rate of local debt is characterized by procyclicality.With each additional percentage of the output gap,the implicit debt growth rate may increase by 5.92%and 3.97%respectively during the boom and recession.Even with controlled the market financing environment,this feature is still evident.Further empirical analysis finds that officials’promotion pressure aggravates the pro-cyclical nature of local debt.Local debt is not only an important financing tool for local governments to ease capital constraints and stimulate economic growth,but also threatens economic stability because of its risk attributes.This paper argues that local governments have different emphasis on their goals at different stages of the economic cycle which may be an important reason for the pro-cyclical characteristics of local debts.