Selection of Mergers and Acquisitions by Foreign Capital in Open Economies

By a linear Cournot model, the factors associated with the integration of two firms are discussed in terms of their effects on the private surplus and the social welfare in economies with varying extent of openness. Meanwhile, the trade policy of the host government is taken into account. It is concluded that the more open the economy and the more intense the competition, the less profitable the integration; the most important determinant to the changes of the domestic social welfare is the industry strength of the host country. The host authority can enhance the domestic social welfare in two ways： to adjust the trade policy and to only approve the socially desirable cross-border mergers and acquisitions.

Establishment of a New Spatial Agglomeration of an Open Economy:Theoretical Basis,Historical Practice and Feasible Pathways

The new spatial agglomeration of an open economy should conform to the spatial agglomeration theory of the new economic geography and the characteristic conditions of the Chinese population,follow the historical practice and development trend of the spatial agglomeration of China’s open economy for the past 40 years since reform and opening up,fit the transformation of the development status and goals of the Chinese economy,and fulfill the requirements of the new era brought about by the new trends of economic globalization.It is necessary to guide the open economy towards a proper clustering in the central and western regions and accelerate the regional opening up.Meanwhile,in order to promote the proper distribution of production factors and the coordinated development of an open economy,we should facilitate the spatial optimization distribution of production factors by employing the comparative regional advantages and endowments,thereby improving the international competitiveness of China’s open economy.

Piketty’s Capital-Income Theory Reconsidered for a Small Open Economy with Increasing Savings Rate

Since Piketty offered a new view of capital/income ratio, numerous attempts have been made to examine the relationship between return on capital, economic growth and the capital/income ratio. This paper attempts to shed new light on this field. More precisely, following recent literatures that pay attention to dynamics of external balance sheets of countries, we examine if Piketty’s results for large countries are robust for a country that takes the world rate of return on capital as given and whose savings rate increases gradually from negative value. It is revealed that for such a country, (1) Kuznets curve is drawn and (2) capital/income ratio decreases in accordance with a rise in savings rate and return on capital.

The Analysis of the Effect of China＇s Monetary Policy in Open Economy

Firstly, this paper theoretically proves that with the development of open economy the effect of monetary policy will become poor. Secondly, the paper empirically analyzes the impact of open economy on our monetary policy. We conclude that there no longer exists long stable relationship between money supply and economic growth. Finally, in four aspects the paper concretely points out that with the open of economy great changes will take place in the implementation of our monetary policy.

EFFECTS OF EXCHANGE RATE AND TARIFFS ON AN OPEN ECONOMY OF SCARCITY OF CAPITAL

In this paper, the impact of tariffs and exchange rate on consumption and investment in an open economy of scarcity of capital is analysed.The dynamics and market price of capital,and the solution of foreign asset holding of the firm are discussed.Particular attention is also devoted to the social welfare aspects.

China＇s Developing Open Economy： Myths and Realities

Both academia and actual economic sectors have certain misunderstandings regarding the development of China＇s open economy. Since its accession to the WTO, China has in fact had an open economy and not an ＂export-oriented＂ economy. China＇s trade imbalance in the global economy is merely a result of economic disparities between the world＇s more- and less- developed regions combined with the rational optimization of resources. The current situation, wherein China appears to be heavily export-oriented, stems naturally from the real economy moving towards a dynamic equilibrium against a backdrop of economic globalization and deepening international specialization. We have concluded that domestic consumption and external demand reinforce each other, and the development of an open economy in China is therefore not at odds with expanding domestic consumption.

“入世”与南京外向型经济的发展

Nanjing’s Opening - outside Economy have made great progress, but there is stilla long distance to the rules of WTO. After China’s entering WTO, the local governments and enterprises must follow the rules of WTO. This paper gives eight suggestions and strategies aimedly with an objective analysis of Nanjing’s shortages in the opening -outside economy.

Social Security Development in China and Its Support to Economic Transition

In 70 years since the founding of the People’s Republic of China,China has successfully transitioned from a closed economy to an open economy with the watershed year of reform and opening up in 1978 and modernized its social security system accordingly.This paper divides the transition of China’s social security system into seven stages before and after 1978.The traditional social security system was predicated on the dominant public ownership,a highly centralized economy,and“full employment.”It was congruous with the ownership structure,income distribution,and labor systems under the closed economy.The modern social security system is developed to meet the needs of an open economy and promotes economic development by giving play to consumption and investment,facilitating labor flow,and boosting productivity.The modern social security system requires further supply-side structural reforms to promote the high-quality development of the open economy.

PRODUCTIVE GOVERNMENT EXPENDITURE IN A STOCHASTICALLY GROWING OPEN ECONOMY

This paper employs a stochastic endogenous growth model with productive government expenditure in a small open economy to analyze the optimal fiscal policy. First, a stochastic model of a small open economy is constructed. Second, the equilibrium solutions of the representative agent＇s stochastic optimization problem are derived. Third, we obtain the equilibrium solutions of the central planner＇s stochastic optimization problem and the optimal government expenditure policy. Finally, the optimal tax policy is characterized.

Trilemma,RMB exchange rate regime reform,and policy orientation after August 2015

The discussions on RMB exchange rate could not depart from the ongoing reform of RMB exchange rate regime,which must be designed and promoted as an integral part of the large open economy macroeconomic policy framework.As a large open economy facing the trilemma,China should explicitly establish the principle of domestic monetary policy dominance in the impossible trinity,with the exchange rate policy and capital account management should both conform to this fundamental principle.Simplistically pegging RMB to the US dollar will result in lack of flexibility and violate this principle.Especially against the backdrop of unsynchronized economic cycles of major economies and the prospect of further Fed tighten up,that the real effective exchange rate of RMB moves passively along with the US dollar cannot reflect the relative changes in economic fundamentals in China and abroad,which will cause distortions,resulting in resource misallocations and loss of welfare.The reform of RMB exchange rate regime should be market-oriented,towards a direction with more flexibility.