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Remittances for Collective Consumption and Social Status Compensation : Variations on Transnational Practices among Chinese International Migrants

International Migration Review, 52(1), 2018.

This paper focuses on a special type of remittances — monetary remittances sent by international migrants to their hometowns to build symbolic structures and cultural facilities for collective consumption. We develop an analytical framework to examine the motives behind migrants’ remitting behavior and the mechanisms for realizing their remitting objectives based on a comparative study of two emigrant groups from China.

We find that the sending of remittances for collective consumption serves as a unique mechanism for social status compensation. Such behavior is not only affected by migrants’ socioeconomic circumstances or government policies, but also by intersecting contextual and institutional factors at multiple levels transnationally.




Internalisation Theory and Outward Direct Investment by Emerging Market Multinationals

Peter J. Buckley.

Management International Review, 58(2). 2018.

The rise of multinational enterprises from emerging countries (EMNEs) poses an important test for theories of the multinational enterprise such as internalisation theory. It has been contended that new phenomena need new theory. This paper proposes that internalisation theory is appropriate to analyse EMNEs.

This paper examines four approaches to EMNEs—international investment strategies, domestic market imperfections, international corporate networks and domestic institutions—and three case studies—Chinese outward FDI, Indian foreign acquisitions and investment in tax havens—to show the enduring relevance and predictive power of internalisation theory.

This analysis encompasses many other approaches as special cases of internalisation theory. The use of internalisation theory to analyse EMNEs is to be commended, not only because of its theoretical inclusivity, but also because it has the ability to connect and to explain seemingly desperate phenomena.

URL: https://link.springer.com/article/10.1007/s11575-017-0320-4

Courtesy: Springer

The End of Cheap Labor: Are Foreign Investors Leaving China?

Julian Donaubauer and Christian Dreger. (2018).

Asian Economic Papers17(2). 

China’s government has been promoting the shift toward a consumption-based economy in the past few years to arrive at a path of sustainable and socially inclusive growth. In this context, the explicit goal to significantly raise the percentage of wages in the national household income was an integral part of the 12th Five-Year Plan (2011–15). These changes in economic strategy are likely to affect the attractiveness of the country to foreign investors. In this paper, we raise the hypothesis that soaring relative wages negatively affect foreign direct investment (FDI) inflows to China, and alter their distribution within China. In addition, low-wage countries in the Asian region might benefit from the changed direction of FDI inflows. We utilize fixed-effects panel models with spatial spillovers for Chinese provinces and developing ASEAN countries to provide strong and robust evidence that wage increases change the allocation of FDI within China. In addition, we show that the changes in China’s economic strategy improve the chances of its low-income neighbors to attract FDI.

URL: https://www.mitpressjournals.org/doi/abs/10.1162/asep_a_00611

Courtesy: MIT Press journals

Industry policy in Asia’s demographic giants: China, India and Indonesia compared

Tom Barnes

  The Economic and Labour Relations Review, Volume 28, Issue 2, June 2017

The experience of industry policy in the wider Asian region contrasts significantly with many of the neoliberal policy prescriptions prevalent in Australia today. Using the automotive industry as a comparative case study, this article compares industry policy in three demographic and geographic giants of the region: China, India and Indonesia. China’s dominant position has benefited from a highly ‘interventionist’ industry policy which places strict conditions on foreign carmakers in joint ventures. This policy has also influenced the emergence of a thriving domestic industry, with state-owned enterprises leading the way. While India has also emerged as a major auto producer, its industry policy has moved away from the joint venture model since the 1990s, with fully foreign-owned operations now playing a much bigger role. In contrast, Indonesia retains a version of the joint venture model while local industry is dominated by Japanese capital. The record of industry policy in these countries challenges the idea that more ‘liberal’ economic systems lead to stronger domestic industries or firms.

URL: http://journals.sagepub.com/doi/abs/10.1177/1035304616656562

Courtesy: Sage

The Sino-Indian border issue as a factor for the development of bilateral relations

Albina Muratbekova

Asian Journal of Comparative Politics, 2018, Vol. 3(1)

The border issue between China and India has been prominent since the establishment of diplomatic relations between the two countries. Depending on time, an internal and external situation has changed, hence the value of disputed territory also shifted. This article shows the development of the border issue, recent rapprochements, and steps taken to settle the issue.

URL: http://journals.sagepub.com/doi/abs/10.1177/2057891117690453

Courtesy: Sage

How Does the Productivity and Economic Growth Performance of China and India Compare in the Post-Reform Era, 1981-2011?

Wu, Harry X.; Krishna, K. L.; Das, Deb Kusum; Das, Pilu Chandra

International Productivity Monitor, Fall 2017

Applying an aggregate production possibility frontier (APPF) framework for growth accounting à la Jorgenson et al. to economy-wide Chinese and Indian industry productivity accounts, constructed in the spirit of the KLEMS principle, we estimate and compare growth and productivity performance in China and India over their post-reform period from 1981 to 2011. We show that during this period China grew over 50 per cent-faster than India in
value added (9.4 versus 6.1 per cent per annum) but about 25 per cent-slower than India in TFP (0.83 versus 1.13 per cent per annum). The two economies also experienced very different growth and productivity performances over sub-periods distinguished by special policy regimes and governing systems. While both countries appeared to enjoy their best performances in the 2002-2007 period following China’s WTO entry, China faltered much more in terms of total factor productivity growth in the wake of the global financial crisis.

URL: http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=11&sid=72ce6719-03e3-48f0-b408-235059a7eee5%40sessionmgr4010

Courtesy: Econlit

Transforming peasantries in India and China: comparative investigations of institutional dimensions

Ashwani Saith

The Indian Journal of Labour Economics, Volume 59, Issue 1

My lecture is about the study of transforming peasantries, in two senses: both as the subjects, as well as the agents of societal transformation. The differential development performance of rural India and China is explained through stylised micro-comparisons drawn from longitudinal village, and synthetic field studies conducted by the author in both countries since the 1970s, highlighting the salience of contrasting rural institutional factors, using a string of binary contrasting features displayed by the Indian village vis-a-vis the collectives of rural China. The micro-cosmic comparison poses a puzzling paradox: Chinese rural development performance easily outstripped Indian achievements in the first three decades of its collectivist path, from 1949–1978, despite the upheavals associated with the Great Leap Forward and the large-scale famines of the time. But, if the initial conditions of the two countries were remarkably equivalent, and if the external factors, state macro and inter-sectoral policies were no more, and in some respects, considerably less favourable in China than in India, how can one explain the superior Chinese performance in the countryside virtually across the board for this early high-collectvism period that laid the foundations for the subsequent high-growth trajectory at the national level? Why did rural China pull ahead, why did India lag behind? The micro-cosmic comparisons of rural institutions are used to resolve this paradox. The answer lies in the crucial differentiated role of the institutional dimension in the two countries. Chinese advantage originates not in the market reforms era, but in the socialist period when the countryside was organised in rural collectives. In India, rural institutions were generally obstructive, sticky, and posed a constraint to policies of rapid transformation; in China, the institutional profile, far from setting a constraint, was itself converted into a policy instrumental variable, where institutional features were designed and periodically redesigned primarily using the criteria of their functional appropriateness for generating rural accumulation and growth.

URL: https://link.springer.com/article/10.1007/s41027-016-0051-2/fulltext.html

Courtesy: Springer