Bo, Shiyu
(2016)
Essays on development economics and Chinese economy.
PhD thesis, London School of Economics and Political Science.
Abstract
This thesis consists of three independent chapters on development economics and Chinese economy.
The first chapter examines how centralization affects regional development. I draw upon plausibly exogenous variations in centralization from a political hierarchy reform in China to investigate it in a novel sub-provincial setting. I show that centralization has positive and significant effects on the overall industrial output and urban population of regions. To understand the mechanism, I propose a theoretical framework, where centralization will help to reduce resource misallocation within a region and improve aggregate productivity. Consistent with it, my analysis of industrial firm-level data reveals a reduction in the dispersion of marginal products after centralization, and I quantify the productivity gains from centralization in a counterfactual analysis. In addition to the positive overall effects on regions, the reform also has distributional effects for the different counties that constitute the region.
The second chapter evaluates a firm-based pollution regulation in China in 2007 to investigate the relationship between political incentives and effects of environmental regulations. I show that when a municipality Party secretary has more incentives to improve the local economy for promotion, measured by his age, adverse impacts in employment and output on regulated firms will be much larger. At the same time, loss in regulated firms will be associated with gains in other unregulated firms in polluting industries, and there is no overall effects in manufacturing activities on polluting industries. I find that emissions of pollutants in municipalities with high incentive leaders experience a significant reduction.
The third chapter estimates the effects of children genders on parents’ time allocation due to the long-existing son preference in developing countries. Using household survey data in China from 1989 to 2009, I show that with more sons instead of daughters, both father’s and mother’s time on housework will rise. At the same time men will increase their working time on labour markets and women can enjoy more leisure on the contrary. For possible endogeneity in children’s gender, I exploit exogenous variations from a law to forbid the use of ultrasound-B to reveal fetus gender.
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