全部 标题 作者
关键词 摘要


The Population Age Structure, the Real Effective Exchange Rate and the Current Account Balance—Empirical Analysis Based on the Data of Chinese Provincial Panel

DOI: 10.4236/ajibm.2018.81005, PP. 69-82

Keywords: Youth Dependency Ratio, Elderly Dependency Ratio, the Real Effective Exchange Rate, Current Account, Dynamic Panel Generalized Method of Moments

Full-Text   Cite this paper   Add to My Lib

Abstract:

This paper takes the panel data of 29 provinces, municipalities and autonomous regions in China as samples from 1994 to 2015, using dynamic panel GMM to analyze the relationship between China’s population age structure, the real effective exchange rate and current account balance. System generalized method of moments and robustness test show that the adjustment of China’s current projects has obvious inertial characteristics; the change of population age structure has significant negative influence on the current account balance, the impact of youth dependency ratio on the current account is not significant, the elderly dependency ratio has a significant negative impact on current account; the effect of the real effective exchange rate on current account is not significant, the “Theory of Exchange Rate Manipulation in the Chinese Government” is not valid and untenable. The conclusion of this paper shows that the change of population age structure is an important reason for the long-term surplus of China’s current account.

References

[1]  Coale, A.J. and Hoover, E.M. (1958) Population Growth and Economic Development in India, 1956-1986. Population, 13, 152.
https://doi.org/10.2307/1524483
[2]  Fry, M.J. and Mason, A. (1982) The Variable Rate-of-Growth Effect in the Life-Cycle Saving Model: Children, Capital Inflows, Interest and Growth in a New Specification of the Life-Cycle Model Applied to Seven Asian Developing Countries. Economic Inquiry, 20, 426-442.
https://doi.org/10.1111/j.1465-7295.1982.tb00359.x
[3]  Taylor, A.M. and Williamson, J.G. (1994) Capital Flows to the New World as an Intergenerational Transfer. Journal of Political Economy, 102, 348-371.
https://doi.org/10.1086/261935
[4]  Higgins, M. (1998) Demography, National Savings, and International Capital Flows. International Economic Review, 39, 343-369.
https://doi.org/10.2307/2527297
[5]  Chinn, M.D. and Prasad, E.S. (2003) Medium-Term Determinants of Current Accounts in Industrial and Developing Countries: An Empirical Exploration. Journal of International Economics, 59, 47-76.
https://doi.org/10.1016/S0022-1996(02)00089-2
[6]  Li, X., Li, Z. and Chan, M.L. (2012) Demographic Change, Savings, Investment, and Economic Growth: A Case from China. Chinese Economy, 45, 5-20.
https://doi.org/10.2753/CES1097-1475450201
[7]  Wang, R.Y. (2003) Population Age Structure, Trade Balance and the Adjustment of China’s Exchange Rate Policy. World Economy, 9, 3-9.
[8]  Yang, J.J. (2010) Demographic Factors Affecting China’s Foreign Trade Surplus— An Empirical Analysis Based on the Dynamic GMM Method. Knowledge Science, 9, 90-96.
[9]  Wang, W. (2012) Changes in Population Structure and China’s Trade Surplus: A Theoretical and Empirical Study. Finance and Economic Research, 8, 26-37.
[10]  Xie, J.G. and Zhang, B.N. (2013) Changes in Population Structure and the Adjustment of Current Account Income and Expenditure: A Study Based on Multinational Panel Data. World Economy, 9, 3-24.
[11]  Ma, D. and Shi, L.L. (2014) Population Age Structure, Population Industrial Structure and Current Account—An Empirical Study Based on China’s Provincial Panel Data. Zhejiang Finance, 4, 17-22.
[12]  Peng, S.D. and Xiong, M.T. (2015) Study on the Influence of Population Age Structure on the Imbalance of Trade Balance between China and the United States. International Trade Issues, 6, 72-81.
[13]  Bickerdike, C.F. (1920) The Instability of Foreign Exchange. Economic Journal, 30, 118-122.
https://doi.org/10.2307/2223208
[14]  Marshall, D. (1929) The Domestic Servants of the Eighteenth Century. Economica, 25, 15-40.
https://doi.org/10.2307/2548516
[15]  Krugman, P.R. and Hooper, P. (1987) The Persistence of the U.S. Trade Deficit. Economic Activity, 1987, 1-56.
https://doi.org/10.2307/2534513
[16]  Baldwin, R. and Krugman, P. (1989) Persistent Trade Effects of Large Exchange Rate Shocks. Quarterly Journal of Economics, 104, 635-654.
https://doi.org/10.2307/2937860
[17]  Bahmani-Oskooee, M. and Brooks, T.J. (2006) The Purchasing Power Parity Puzzle in Developing Countries. In: Morales-Zumaqero, A., Ed., International Macroeconomics: Recent Developments, Nova Science, New York, 53-61.
[18]  Bahmani-Oskooee, M. and Ratha, A. (2004) The S-Curve Dynamics of US Bilateral Trade. Review of International Economics, 28, 32-38.
[19]  Bahmanioskooee, M. and Ardalani, Z. (2006) Exchange Rate Sensitivity of US Trade Flows: Evidence from Industry Data. Southern Economic Journal, 72, 542-559.
https://doi.org/10.2307/20111832
[20]  Bahmani-Oskooee, M. (1985) Devaluation and the J-Curve: Some Evidence from LDCs. The Review of Economics and Statistics, 67, 500-504.
https://doi.org/10.2307/1925980
[21]  Hooper, P. and Kohlhagen, S.W. (1978) The Effect of Exchange Rate Uncertainty on the Prices and Volume of International Trade. Journal of International Economics, 8, 483-511.
https://doi.org/10.1016/0022-1996(87)90001-8
[22]  Gotur, P. (1985) Effects of Exchange Rate Volatility on Trade: Some Further Evidence. Staff Papers, 32, 475-512.
[23]  Bailey, M.J., Tavlas, G.S., Ulan, M., et al. (1987) The Impact of Exchange-Rate Volatility on Export Growth: Some Theoretical Considerations and Empirical Results. Journal of Policy Modeling, 9, 225-243.
https://doi.org/10.1016/0161-8938(87)90010-X
[24]  Wilson, P. (2000) Exchange Rates and the Trade Balance: Korea Experience 1970 to 1996. Seoul Journal of Economics, 13, 135-164.
[25]  Lu, X. and Dai, G. (2005) The Impact of RMB Real Exchange Rate Fluctuation on China’s Import and Export: 1994-2003. Economic Research, No. 5, 31-39.
[26]  Liu, Y., Zhou, J. and Xu, X. (2010) Dynamic Impact of RMB Exchange Rate Changes on China’s Trade Balance. Economic Research, No. 5, 32-40.
[27]  Liu, H. and Qin, T. (2015) Relative Price, Income Expectation and Current Account Volatility in China—An Empirical Study Based on the Cross-Term Consumption Perspective of Two Sectors. Financial Research, No. 9, 34-49.
[28]  Ye, Y., Hu, L. and Huang, B. (2006) The Relationship between RMB Real Effective Exchange Rate and Foreign Trade Revenue and Expenditure—An Empirical Study of Bilateral Trade Revenue and Expenditure between China and the United States, China and Japan. Financial Research, No. 4, 1-11.
[29]  He, L. (2008) RMB Exchange Rate and China’s Current Account Surplus in Recent Years. Journal of Financial Research, No. 3, 13-27.
[30]  Wang, J. and Guo, X. (2011) Revaluation of the RMB, Current Account Imbalance and China’s Technological Progress. Financial Research, No. 11, 47-61.

Full-Text

comments powered by Disqus