This paper uses the input-output tables from 2007 to estimate the exchangerate risk exposure of all 42 sectors of the Chinese economy. It then demonstrates a new quantitative approach for examining the differential im...This paper uses the input-output tables from 2007 to estimate the exchangerate risk exposure of all 42 sectors of the Chinese economy. It then demonstrates a new quantitative approach for examining the differential impacts of Renminbi appreciation on the export of finished goods and the import of intermediate inputs in each sector, and estimates the changes in profitability of each sector under different degrees of Renminbi appreciation. The results indicate that appreciation of the Renminbi will increase the profitability of 22 sectors, which are generally monopolistic, capital-intensive, and reliant on R＆D, and reduce the profitability of 20 sectors, which are generally competitive, labor-intensive, and less reliant on R＆D. This suggests that the degree and pace of Renminbi appreciation must be coordinated with industrial and employment policies in order to reduce exchange-rate risk exposure through trade restructuring, to improve economic structure, to promote competition and employment, and to maintain steady and sustainable economic growth.展开更多
To identify the macroeconomic environment that has enabled China's industrial upgrading during a period of persistent renminbi appreciation,we construct a two-country New Keynesian model of industrial upgrading wi...To identify the macroeconomic environment that has enabled China's industrial upgrading during a period of persistent renminbi appreciation,we construct a two-country New Keynesian model of industrial upgrading with a global production network,endogenous firm entry,and a directed quality frontier.We show that renminbi appreciation promotes industrial upgrading without hurting real economic growth in the longer run.This holds true especially through four channels.First,the quality threshold for firm entry is lower to allow for more firms participation and thus greater product varieties(quality threshold channel).Second,upstream skill-based production uses more imported inputs of higher quality(imported input channel).Third,there is substantial global demand towards the exports of high-quality inputs(global demand channel).Fourth,domestic inputs are competing against imported inputs to broaden the scope for competition in the upstream product market to incentivize quality upgrading(scope for competition channel).展开更多
文摘This paper uses the input-output tables from 2007 to estimate the exchangerate risk exposure of all 42 sectors of the Chinese economy. It then demonstrates a new quantitative approach for examining the differential impacts of Renminbi appreciation on the export of finished goods and the import of intermediate inputs in each sector, and estimates the changes in profitability of each sector under different degrees of Renminbi appreciation. The results indicate that appreciation of the Renminbi will increase the profitability of 22 sectors, which are generally monopolistic, capital-intensive, and reliant on R＆D, and reduce the profitability of 20 sectors, which are generally competitive, labor-intensive, and less reliant on R＆D. This suggests that the degree and pace of Renminbi appreciation must be coordinated with industrial and employment policies in order to reduce exchange-rate risk exposure through trade restructuring, to improve economic structure, to promote competition and employment, and to maintain steady and sustainable economic growth.
文摘To identify the macroeconomic environment that has enabled China's industrial upgrading during a period of persistent renminbi appreciation,we construct a two-country New Keynesian model of industrial upgrading with a global production network,endogenous firm entry,and a directed quality frontier.We show that renminbi appreciation promotes industrial upgrading without hurting real economic growth in the longer run.This holds true especially through four channels.First,the quality threshold for firm entry is lower to allow for more firms participation and thus greater product varieties(quality threshold channel).Second,upstream skill-based production uses more imported inputs of higher quality(imported input channel).Third,there is substantial global demand towards the exports of high-quality inputs(global demand channel).Fourth,domestic inputs are competing against imported inputs to broaden the scope for competition in the upstream product market to incentivize quality upgrading(scope for competition channel).
