Do Free Trade Zones Improve Air Quality? Zongyi, Hu; Jikun, Zhou; Yi, Li
China Economic Transition = Dangdai Zhongguo Jingji Zhuanxing Yanjiu,
01/2023, Volume:
6, Issue:
2
Journal Article
As a new window of opening up to the outside world in the new era, the establishment of Free Trade Zones (FTZs) in China is an important national strategy for promoting high-quality economic ...development wherein the prevention and control of pollution is an important hurdle to be surmounted throughout the process. Based on data taken from model cities for environmental protection in China from 2008 to 2017, given the effect of policy spillover, this study considers the establishment of FTZs to be a "quasi-natural experiment." It uses the general analysis paradigm of spatial difference-in-difference (DID) to systematically examine the impact of FTZs on air pollution as well as to conduct an in-depth analysis of their spatial heterogeneity and mechanism of action. The study shows that the establishment of FTZs significantly reduces the concentration of air pollutants in cities. If the spatial DID method is adopted to measure the policy spillover effect of the establishment of free trade zones, urban air pollutants declines by 12% to 17%, while the estimated result using the traditional DID method is only 7%. The establishment of FTZs significantly alleviates air pollution in neighboring non-pilot cities as well. Based on the range of the spillover effect from the center of the FTZ, it is found that the average spatial spillover effect presents as an inverted "U" curve as the research radius increases, with an optimal policy spillover effect radius of about 200km, while the policy spillover effect between pilot cities remains poor. The establishment of an FTZ not only improves the local atmospheric environment by promoting industrial structure optimization and green technology innovation in pilot cities but also generates a spillover effect on neighboring non-pilot cities through the same mechanism, thus contributing to improving the atmospheric environment in those non-pilot cities. These findings remain valid following a series of robustness tests such as the spatial parallel trend test and the placebo test. This study offers an answer to the key question of whether free trade zone policy can truly promote high-quality economic development in the new era. It provides useful policy insights for further expanding opening up, winning the battle for the prevention and control of pollution, and promoting the high-quality development of China's economy.
Purpose
This paper aims to examine the role of foreign banks in transmitting global monetary policy shocks to India. Further, the authors try to explore the international bank lending channel and ...analyze the impact of global monetary policy on Indian macroeconomic variables.
Design/methodology/approach
The authors use a structural break unit root test and structural vector autoregression on monthly data from 1998 to 2018.
Findings
The study finds that the global monetary policy is significantly determining foreign banks’ lending in India; the evidence of a portfolio re-balancing channel in the process of global monetary policy transmission to the Indian economy; the exchange rate is significantly explaining the foreign bank credit dynamism in India; and evidence of international monetary policy spillover to the Indian economy.
Originality/value
This is the first attempt to analyze the role of foreign banks in the transmission of global monetary policy shocks to India, where the literature availability is limited. The finding of ineffective domestic monetary policy on foreign bank lending opens the need for an in-depth and diversified analysis of the role of foreign banks in the transmission of domestic monetary policy.
Purpose
This paper aims to constitute to the first empirical work that investigated the effects of US unconventional monetary policy shocks on Islamic equities.
Design/methodology/approach
The ...authors used the spread between sovereign (term spread) and corporate (corporate spread) yields as proxies of unconventional monetary policy in times that FED implemented different rounds of large-scale asset purchasing programs.
Findings
This paper demonstrates that monetary policy shocks have significant effects on Islamic equities. The analysis showed substantial evidence that the corporate spread innovation was reflected as a positive signal in Islamic equity markets and has a larger impact on Islamic low leverage equities than term spread.
Originality/value
The objective of this paper is to shed some insight into the effects of US unconventional monetary policy on low leverage financial assets. It is hypothesized that during this period, specifically from November 2008, unconventional monetary policy and zero bound interest rates have been implemented in the US economy. However, the strength of effects of this range of policies on Islamic financial products is unidentified.
It is widely perceived that globalization inevitably leads to a retrenchment of tax-financed public-sector activities. The argument is that tax distortions increase when production is more easily ...relocated across countries (the elasticity argument). We question this perception in a model that captures standard mechanisms from trade and open-economy models. Importantly, the retrenchment argument overlooks the fact that the basic effect of integration (i.e., gains from trade) tends to lower the marginal costs of public funds. Moreover, the elasticity argument is not unambiguously supported, and there is no race to the bottom as a result of the perceived terms-of-trade effects of non-cooperative fiscal policies.
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BFBNIB, FZAB, GIS, IJS, INZLJ, IZUM, KILJ, NLZOH, NMLJ, NUK, OILJ, PILJ, PNG, SAZU, SBCE, SBMB, UL, UM, UPUK, ZRSKP
Results from the Philippine Quality Improvement Demonstration Study show that a policy that expands insurance coverage improves quality of care, as measured by clinical performance vignettes, among ...public physicians, and induces a spillover effect that improves quality among private physicians.
►Data are from QIDS, a large social experiment conducted in the Philippines. ►The policy to expand insurance coverage was introduced randomly into 30 communities. ►This led to better clinical practice among public doctors and increased their patient volumes. ►The quality of private practice also improved and private practice volumes decreased. ►Public policy spillover effects can lead to quality improvements in the private sector.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
This paper uses a dynamic economy model, with unionized labor markets, to analyze the effects of labor market reforms, similar to those recently introduced in Germany, on the domestic and trading ...partner economies. The model is calibrated on Germany and the rest of the Euro area. The results indicate that German labor market reforms have positive spillover effects on the rest of the Euro area, which operate through the channel of trade, relative price adjustment, and financial market integration. Compared to a competitive labor market, setting, unionization dampens the positive response of the domestic economy and magnifies the spillover effects.
We use geographically precise longitudinal employment data documenting worker job-to-job mobility to study policy spillovers in the context of three local minimum wage increases. Estimated spillover ...impacts on wages and hours are statistically significant, geographically diffuse, and sufficient to create concern regarding interpretation of results even using not-immediately-adjacent regions as controls. Spillover effects appear less concerning with smaller interventions or those adopted in smaller jurisdictions. The boundary discontinuity method of causal inference may yield misleading results if a policy’s impacts do not stop at the border of the implementing jurisdiction.
•We study policy spillovers in the context of three local minimum wage increases.•Estimated spillover impacts on wages and hours are statistically significant.•Spillovers appear less concerning with small interventions in small jurisdictions.•Boundary discontinuity method of causal inference may yield misleading results.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
•The effects of policy mix design on innovation in energy efficiency are analysed.•A balanced use of pull and push instruments fosters innovation performance.•A more comprehensive policy mix enhances ...innovation performance.•An excessive amount of policy instruments may reduce policy mix effectiveness.•The similarity with foreign policy mixes positively affects innovation performance.
This paper provides an empirical investigation of the role played by selected characteristics of the policy mix in inducing innovation in energy efficiency technologies. An original dataset covering 23 OECD countries over the period 1990–2010 combines the full set of policies in the energy efficiency domain for the residential sector with data on patents applied over the same period in this specific technological sector. The econometric results suggest that when the policy mix is characterised by a more balanced use in demand-pull and technology-push instruments, its positive effects on eco-innovation tend to be greater. Moreover, a more comprehensive policy mix is shown to be able to enhance innovation activities for the generation of new energy efficient technologies. However, the simple addition of an indiscriminate number of simultaneous policy instruments may reduce policy mix effectiveness. Finally, the empirical findings confirm previous evidence on the importance of policy spillover effects, and suggest that policy similarity between countries may represent an important aspect to be accounted for in policy mix design.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK, ZRSKP
•This paper pioneers the discussion on the impact of currency internationalization on monetary policy spillovers.•Empirical results show that U.S. monetary policy shocks significantly impact China's ...interest rate system, and the increasing degree of RMB internationalization can effectively buffer these spillovers. This conclusion remains valid even when different indicators of U.S. monetary policy shocks are used.•Heterogeneity analysis reveals that U.S. monetary policy primarily affects market rates and short-term rates, with negligible effects on policy rates and medium to long-term rates.•Mechanism analysis indicates that U.S. monetary policy alters the domestic interest rate system by shifting short-term financial market expectations, while RMB internationalization counters these shifts, thus providing a buffering effect.•These insights offer valuable guidance for China in managing the monetary policies shocks from major economy.
This paper examines the determinants of U.S. monetary policy spillovers on China's interest rates and the buffering effect of RMB internationalization from the perspective of currency internationalization. Empirical results show that U.S. monetary policy heavily impacts China's market rates and short-term rates, with less effect on policy rates and longer-term rates. The significant influence primarily stems from altering in short-term market expectations. RMB internationalization mitigates these shocks by reversing short-term expectations, thereby dampening U.S. monetary policy spillovers and providing a buffer. These insights offer valuable guidance for China in managing the monetary policies shocks from major economy.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
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