粘土植物大战僵尸A Model of China’s State Capitalism
Xi Li Xuewen Liu Yong Wang
The Hong Kong University of Science and Technology
This version:October2012
Abstract
This paper documents a hallmark feature of China’s state capitalism as the state controlling the economy in a vertical structure:State-owned enterpris(SOEs)monopolize key industries
in the upstream,whereas the downstream industries are largely open to private competition.We
年度计划怎么写develop a general-equilibrium model to show that this unique vertical structure,when combined
with openness and labor abundance,is critical in explaining the puzzling fact that China’s SOEs
outperformed non-SOEs in the past decade while the opposite was true in the1990s.We show
how the upstream SOEs extract rents from the liberalized downstream industries in the process
of industrialization and globalization.The unprecendented prosperity of SOEs is shown to be
an e¢ciency-undermining symptom of the incompleteness of market-oriented reforms rather
than a proof of SOE superiority.Emergence,sustainability,redistributive e¤ects,and general
implications for other countries of this state capitalism are also discusd.
Key Words:State Capitalism;China Economy;Partial Reforms;Growth and Develop-ment;Structural Change;Labor Income Share;International Trade
JEL Classi…cations:F63,L16;O14,O53,P23,P31
The paper was prented at Chine University of Hong Kong,Hong Kong University of Science and Technology, Dallas Fed-SHUFE Conference on International Linkages in a Globalized World,China Economics Summer Institute, and the CCES-SSEM Conference on Institutions,International Trade and Economic Growth.For helpful discussions and comments,we are grateful to Kalok Chan,Sudipto Dasgupta,Steve Davis,Alan Deardor¤,Gino Gancia,Chang-Tai Hsieh,Jennifer Huang,Chad Jones,Tim Kehoe,Joe Kaboski,Justin Yifu Lin,Norman Loayza,Rachel Ngai, Albert Park,Diego Restuccia,Gerard Roland,Kim Ruhl,Katy Russ,Michael Song,Jian Wang,Shang-Jin Wei, Laura Wu,D
anyang Xie,Colin Xu,Dennis Yang,Yang Yao,and Xiaodong Zhu.We thank Chong-En Bai for sharing the data with us.We thank Daravadee Panichakarn,Chenlai Shi,Zhiyang Li,and Yiou Zhang for rearch assistance. Emails:acli@ust.hk;xuewenliu@ust.hk;yongwang@ust.hk.知识竞赛活动方案
1Introduction
Major emerging economies(especially BRIC)all practice some forms of state capitalism,which generally refers to the state controlling an important share of the economy while the private ctor largely operates in the free market.1The ca in point is China.The market-oriented reform toward a so-called“Socialist Market Economy with Chine Characteristics”leads to a rapid expansion of the private ctor while state-owned enterpris(SOEs hereafter)as a whole are still an important part of the economy.2In fact,SOEs are the main focus of the analysis of China’s state capitalism in a recent in‡uential report by the US-China Economic and Security Review Commission under the US Congress(Szamosszegi and Kyle(2011)).
With the backdrop of the economic success of BRIC(especially China)contrasted by the recent deep recession in the developed world,some have touted state capitalism as a legitimate alternative growth model(,the special issue on“state capitalism”in the Economist of Jan21st,2012.).3 In
China for instance,from2001to2011,the total GDP ro from world number six to number two with an annual growth rate clo to10%on average.Most strikingly,SOEs em to outperform non-SOEs in the last decade.Figure1plots the ratio of pro…t to sales revenue of SOEs versus non-SOEs between1993and2010,together with the export as percentage of GDP.
Inrt Figure1Here
The pro…tability of SOEs has surpasd that of non-SOEs in the last decade while the opposite was true in the1990s,even though China has recorded stably high GDP growth rates during the whole period.Interestingly,the pro…tability of SOEs has been co-moving with the export GDP ratio,especially after China entered WTO in2001,although SOEs’share of export has been decreasing and becoming relatively small(e Table1).As further corroboration,Figures2a and
1The term“state capitalism”has various meanings,but it is usually characterized by the dominance or existence of a signi…cant number of state-owned business enterpris(,Binns(1986),Bremmer(2010)).
2According to the National Bureau of Statistics(NBS)of China,the SOEs still account for about40%of total …xed investments(e Lin,Cai and Li(1999),Naughton(2007)).Note that NBS changes the de…
nition of the state enterpris over time,with some years reporting on state owned enterpris(SOEs)and the other years reporting on state owned and holding enterpris(SOEs and SHEs).SOEs are wholly state-owned…rms and SHEs are…rms who majority shares belong to the government or other SOEs.We call all the state enterpris SOEs and the remaining enterpris non-SOEs throughout the paper.
3Most developed economies such as the US and many European countries are generally believed to have adopted liberal capitalism,which features absolute dominance of the private enterpri system and a weaker role for the state. In particular,the share of SOEs in liberal capitalism is typically insigni…cant.桑葚酒的功效
2b prent two alternative measures of pro…tability,namely,the total pro…t of industrial enterpris scaled by the number of enterpris and by employees,respectively.Again,the pro…tability of SOEs far outstrips that of non-SOEs in the last decade.In fact,almost all of the57Chine…rms on the list of the Fortune Global500in2011are SOEs(e Table2).
Inrt Figures2a and2b Here
This recent phenomenon may appear puzzling becau it ems to contradict the common notion th
at enhanced competition due to market-oriented reforms(including trade liberalization)would hurt less e¢cient…rms(SOEs).4It also ems at odds with the literature of structural change and resource misallocation,which predicts the incompatibility of fast aggregate growth with less productive…rms(SOEs)persistently outperforming more productive ones(private…rms).5The main purpo of this paper is to explain this puzzling fact by providing a theory of China’s state capitalism,which has important policy implications.6
Our theory is bad on a crucial feature of China’s state capitalism that emerged around2001. SOEs have monopolized most of the upstream industries(and have also continuously consolidated this power through government-arranged mergers),while the downstream industries are liberalized and mostly open to intensive competition.In other words,the upstream is controlled by the state, whereas the downstream operates under capitalism.For example,the manufacturing ctor,one of the downstream industries and also the main source of commodity trade,has in the last decade already become one of the most liberalized ctors with the lowest shares of state investment.In stark contrast,upstream industries such as petroleum and natural gas,electricity and power, banks,transport,storage and post,and information transmission are still highly monopolized by SOEs,which charge a price markup.7This important“vertical structure”ems to have received
炒竹笋
4There exists abundant empirical evidence that productivities and investment e¢ciency of SOEs are lower than that of non-SOEs;,Sun and Tong(2003)and Dollar and Wei(2007),Liu and Siu(2011),Brandt,Hsieh, and Zhu(2008),and Cao and Liu(2011).So it is unlikely that superior pro…tability of SOEs mainly results from higher TFPs of SOEs than non-SOEs.Empirically,it is challenging to accurately di¤erentiate TFPs from monopoly markup.Notice that TFP calculation in standard growth accounting assumes perfect competition.We will propo an explanation without assuming TFP dominance of SOEs over non-SOEs.
,Kangsmnut,Rebelo and Xie(2001),Ngai and Pissaridies(2007),Restuccia,Yang,and Zhu(2008), Hsieh and Klenow(2009)and Song,Storesletten and Zilibotti(2011).
6In a comprehensive report by the World Bank(2012),further reform of monopolist SOEs is regarded as a top priority.But defenders for SOEs disagree and claim that SOEs are signi…cantly contributing to China’s high growth and hence need more support rather than signi…cant reform.,various articles on the o¢cial website of the State-Owned Asts Supervision and Administration Commission(SASAC hereafter)of the State Council in China.
7There exist numerous anecdotal evidences for markup pricing.For instance,in2011,the monthly rvice fee
insu¢cient attention in the literature,and will be documented in detail in Section2.
Our core argument is as follows:By2001or so,low-productivity SOEs have already exited from most downstream industries while the upstream industries are still monopolized by SOEs. The enhanced trade liberalization(especially the accession to WTO in December2001)results in a rapid expansion of the non-SOEs in the capitalist downstream industries,which in turn leads to more demand for the intermediate goods,factors,and rvices that are monopolized by the SOEs in tho upstream industries.As a conquence,the upstream SOEs‡ourish disproportionately more than the non-SOEs in the competitive downstream.In addition,the SOEs’pro…tability cloly co-moves with the export GDP ratio even though SOEs’share of export is relatively small and decreasing over time.
Notice that,besides the vertical structure,trade openness and labor abundance are the two other important ingredients of our theory.Without the enlarged external demand due to international trade,downstream non-SOEs would not expand that much,and hence upstream SOEs would not be able to make outsized pro…t.On the other hand,without abundant labor,wages would ri immediately after the expansion of the downstream industries.Then there would be less room for the monopoly pricing on the intermediate goods charged by upstream SOEs,as international trade impos a price ceiling on the downstream goods,and thus the upstream SOEs would not be able to
maintain persistent and high pro…tability.
跌倒了就爬起来
Although the analytical focus of this paper is on the post-2001period,our framework can also explain why the fortune of SOEs was the opposite during the1992-2001period(e Section5).The initial deregulation reform and trade liberalization in downstream industries in the1990s led to the entry and expansion of high-productivity non-SOEs,which beat the SOEs in the same industries. Therefore,many SOEs su¤ered vere loss and gradually exited from downstream industries, which were eventually dominated by the competitive non-SOEs.The aggregate economy grew fast as a result of this improved resource reallocation,and non-SOEs outperformed SOEs as a whole until unpro…table SOEs largely exited from the downstream industries,as re‡ected in Figure1. However,once the vertical structure came into its full shape around2001,the remaining SOEs, charged by China Mobile for the20M broadband was188Chine Yuan,while Orange UK only charged50Chine Yuan(excluding line rental).The retail price for93#gasoline was8.33Yuan per liter in Beijing while the average price in US was6.52Yuan per liter in the same year(source:cnpolitics/2012/04/state-owned-enterpri). The Her…ndahl-Hirschman index for market concentration will be provided in Section2.See Szamosszegi and Kyle (2011)for more comprehensive evidences for SOE monopoly in upstream industries.
金字旁名字
which mainly stayed in the upstream industries,started to outperform non-SOEs as they bene…tted from the expansion of downstream industries.SOEs as a whole have changed from being the victims to being the bene…ciaries of the market-oriented reform and trade liberalization.Such a reversal of fortune for SOEs crucially depends on the emergence of the vertical structure,without which SOEs would always get hurt whenever non-SOEs expand becau of the competition e¤ect,no matter whether they compete in the same industry or in horizontally substituting industries.
Our model of state capitalism also has important distributive implications on factor returns. Figure3shows that the share of labor income in China’s total GDP has been persistently declining since1990.It took a dive around2001,when China joined WTO.This pattern is…rst systematically documented by Bai and Qian(2009).It contradicts the common belief that this share should be roughly constant,known as one of the Kaldor facts in standard neoclassical growth theory (,Acemoglu(2008)).It ems also at odds with the standard Heckerscher-Ohlin trade theory(Feenstra(2004)),which implies that labor income share in GDP should increa after trade liberalization becau the price of labor,as the abundant factor,should increa relative to the scarce factor(capital).Why,in a labor-abundant country like China,does the labor income share plunge while the export accelerates after entering the WTO?Besides,the level of this share is also very low by international standards(around40%for China and more than60%in most other economies).
Inrt Figure3Here
This puzzle can be resolved within our framework.One key element of our model is the“ex-cessive”labor supply in the spirit of Lewis(1954).Here the large labor pool in the non-industrial ctor ensures the low and constant wage during industrialization,which in turn yields the declin-ing labor income share as GDP increas.Trade liberalization boosts industrialization and GDP growth,and,therefore,lowers the labor income share even further.This is consistent with Figure 3.The major reforms in the industrial ctors and urban areas started after Deng Xiaoping’s South Tour in1992,so the labor income share began to decline with industrialization.This share plunged around2001becau external demand incread sharply as China entered WTO that year.
濒危动物有哪些
Our general-equilibrium benchmark model studies two cas.We start with the ca of au-tarky,which highlights the mechanism through which the SOE in the upstream industry extracts monopoly rents from the non-SOEs in the competitive downstream industries in the industrial-
