Dear Colleagues, You may be interested in viewing the article abstracts of Volume 5 Number 4, 2017 of Economic and Political Studies (EPS) as follows. Their fulltexts are available online at www.tandfonline.com/reps .
Grassland tenure, livelihood assets and pastoralists’ resilience: evidence and empirical analyses from western China
Shuhao Tan and Zhongchun Tan
Pastoralists in western China are highly vulnerable due to harsh natural conditions and the poor socioeconomic environment they confront. More than 50% of the pastoralists in major grassland areas are living below the survival line; moreover, around 90% of the usable grasslands in China have been degraded to some degree, and the degradation expands at a rate of two million ha per year. Enhancing pastoralists’ resilience is desirable for the economic development and social stability in pastoral areas. As an important aspect influencing livelihoods, grassland tenure in China has not been well studied to learn how it affects the welfare of pastoralists, and what can be done to strengthen their resilience. Based on the evidence from four periods of fieldwork conducted by the authors during 2005–2014, the study applies an analytical framework adapted from the sustainable livelihood theory to examine the interactions of grassland tenure, livelihood assets of pastoralists and their resilience. Main findings show that the existing grassland tenure arrangements cause unbalanced and decreased livelihood assets, which in turn reduce the resilience of pastoralists by lowering their capacities of coping with stresses or shocks. Of the policies and measures aiming to enhance the pastoralists’ adaptive capacity and ongoing development, building social capital is critical. Developing functional livelihood asset markets such as grassland rental markets and financial markets will also contribute to a more robust livelihood structure.
Outward foreign direct investment in agriculture by Chinese companies: land grabbing or win–win?
Qianheng Chen and Pei Guo
Using the firsthand materials collected during on-site fieldworks and in-depth interviews, this paper examines the dimensions, especially the motives, for driving Chinese firms to invest in agriculture overseas from the macro (or government’s)- and micro (or firms’)-perspectives, as well as the impact of Chinese firms’ agricultural outward foreign direct investment (OFDI) from the multistakeholder perspective. From the perspective of China’s central government, the goal of encouraging domestic enterprises’ overseas investment in agriculture is not to ensure national grain security, but to stabilise the domestic supply of strategic agricultural products. From the micro-perspective, the impetuses for driving Chinese firms to invest in agriculture overseas are diverse and land exploitation is just one of them. They may wish to compete with local producers and some of the enterprises do not have a strong awareness of environmental protection and social responsibility. This is not the whole story. Chinese enterprises’ agricultural OFDI increases agricultural investment and reduces poverty in the host countries, and expands the supply of agricultural products of the local markets. In the long run, the growing presence of Chinese firms with advanced technology will yield the benefits of competition: an expansion of local supplies while providing cheap technology that can be duplicated by local farmers. Only a very small proportion of the agricultural products grown abroad is sold back to China, while a large part is sold domestically or exported to a third market. Therefore, Chinese firms’ agricultural OFDI has offered little direct, but some indirect, help in guaranteeing China’s food security. Perhaps, China’s diplomatic and political benefits obtained through agricultural OFDI outweigh the benefits of ensuring food security. Chinese enterprises’ agricultural OFDI is a win–win situation for the host countries and for China.
The roadmap of interest rate liberalisation in China
Terence Tai Leung Chong and Wenqi Liu
This paper examines the roadmap of interest rate liberalisation in China, including the current dual-track interest rate system andthe future benchmark rate system. It provides a theoretical foundation for China to develop its own benchmark interest rate. A vector autoregression model is estimated to investigate the effectiveness of Chinese market interest rates, Shanghai Interbank Offered Rate (SHIBOR), and repo rates against different factors such as market size, volatility, transmission channels of monetary policy, and term structures of interest rates. The result shows that SHIBOR affects both the market and the economy. As SHIBOR promptly reflects the changes in currency markets, we argue that it has the potential to become China’s benchmark interest rate.
Understanding the Chinese stock market: international comparison and policy implications
Zhenya Liu and Shixuan Wang
The definitions of the bear, sidewalk and bull markets are ambiguous in the existing literature. This makes it difficult for practitioners to distinguish between different market conditions. In this paper, we propose statistical definitions of the bear, sidewalk and bull markets, which correspond to the three states in our hidden semi-Markov model. We apply this analysis to the daily returns of the Chinese stock market and seven developed markets. Using the Viterbi algorithm to globally decode the most likely sequence of the market conditions, we systematically find the precise timing of the bear, sidewalk and bull markets for all the eight markets. Through the comparison of the estimation and decoding results, many unique characteristics of the Chinese stock market are
revealed, such as ‘crazy bull’, ‘frequent and quick bear’ and ‘no buffer zone’. In China, the bull market is more volatile than in developed markets, the bear market occurs more frequently than in developed markets, and the sidewalk market has not functioned as a buffer zone since 2005. Possible causes of these unique characteristics are also discussed and implications for policy-making are suggested.
Pension reform: Australia and China compared
Hazel Bateman and Kevin Liu
Over the past few decades, China’s pension system has evolved from separate schemes almost exclusively for urban and public sector workers to one with broad national coverage. In a similar time-frame, successive Australian governments have introduced reforms to Australia’s retirement income arrangements in an attempt to increase retirement savings and address age-related pressures on the financing of the publicly provided age pension. This paper compares, contrasts and assesses the pension systems in China and Australia. Although China and Australia are at different stages of economic development and demographic transition and operate quite different pension systems, there are lessons to be learned from each other.
Retirement and labour markets under the context of pension reform in Latin America
Latin America has been experiencing a process of pension reform for more than three decades. Although these reforms have had some success in helping the systems achieve fiscal sustainability, they have not provided the citizens of Latin American countries with broad social protection, thus leaving a certain proportion of people without access to pensions during their old age and, in many cases, forcing them to extend their participation in the labour force. Hence, there is a need to identify the socioeconomic factors that promote the likelihood of obtaining a pension or, conversely, of continuing to work into old age. Based on micro-data from the National Household Surveys of five representative Latin American countries, this paper uses a Probit model to investigate this likelihood. Depending on country-specific aspects, this research finds that factors such as wealth accumulated during working years, high levels of education, additional income flows, family support, and age and gender tend to define the fate of the elderly regardless of whether they are included under the social protection umbrella.
Creating fiscal space to pay for pension expenditure in Asia
Mukul G. Asher and Azad Singh Bali
Many Asian countries are projected to age rapidly and will need to devote a larger proportion of their GDP to finance age-related expenditure including on pensions. Governments therefore will have to create additional fiscal space to fund such expenditure to sustain the credibility of existing pension promises. This paper presents an exploratory framework for creating fiscal space. The framework has three interrelated components: enhancing broadbased growth, improving revenue performance and better expenditure management. The paper distinguishes between funding of pensions, i.e. the share of GDP devoted to pensions, and financing of pensions, i.e. the different methods and instruments used to finance pensions. The focus of the paper is on funding, and the framework relies on both the income–expenditure flows and the government balance sheet to create fiscal space. Several examples of how potential fiscal space can be created in Asian economies of China, India and Indonesia to make their pension promises more credible are provided. The paper emphasises that the measures discussed for enhancing fiscal space should not be undertaken as a purely technical exercise, but should be combined with managing the political economy in a given context.