Shang-Jin Wei

The National Bureau of Economic Research, Cambridge, Massachusetts, United States

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Publications (158)92.57 Total impact

  • Source
    Robert Koopman, Zhi Wang, Shang-Jin Wei
  • Source
    Zhi Wang, Shang-Jin Wei, Kunfu Zhu
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    ABSTRACT: The views in the paper are those of the authors and may not reflect the views of the USITC and its Commissioners, the National Bureau of Economic Research, or any other organization that the authors are affiliated with. We thank Peter Dixon for constructive discussions and Ellen Lan Lin and Nikhil Patel for editorial assistance. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2013 by Zhi Wang, Shang-Jin Wei, and Kunfu Zhu. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source.
    NBER WORKING PAPER SERIES; 11/2013
  • Qingyuan Du, Shang-Jin Wei
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    ABSTRACT: Motivated by recent empirical work, this paper formalizes a theory of competitive savings - an arms race in household savings for mating competition that is made more fierce by an increase in the male-to-female ratio in the pre-marital cohort. Relative to the empirical work, the theory can clarify a number of important questions: What determines the strength of the savings response by males (or households with a son)? Can women (or households with a daughter) dis-save? What are the conditions under which aggregate savings would go up in response to a higher sex ratio? While the theory can be best tested using data from countries with a sex ratio imbalance, the competitive saving motive is likely to be present and important in all countries.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    Journal of International Economics 03/2013; · 1.73 Impact Factor
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    Robert Koopman, Zhi Wang, Shang-Jin Wei
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    ABSTRACT: This paper proposes a framework for gross exports accounting that breaks up a country’s gross exports into various value-added components by source and additional double counted terms. By identifying which parts of the official trade data are double counted and the sources of the double counting, it bridges official trade (in gross value terms) and national accounts statistics (in value added terms). Our parsimonious framework integrates all previous measures of vertical specialization and value-added trade in the literature into a unified framework. To illustrate the potential of such a method, we present a number of applications including re-computing revealed comparative advantages and the magnifying impact of multi-stage production on trade costs.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    American Economic Review 11/2012; · 2.69 Impact Factor
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    Robert Koopman, Zhi Wang, Shang-Jin Wei
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    ABSTRACT: For many questions, it is crucial to know the extent of domestic value added (DVA) in a country's exports, but the computation is more complicated when processing trade is pervasive. We propose a method for computing domestic and foreign contents that allows for processing trade. By applying our framework to Chinese data, we estimate that the share of domestic content in its manufactured exports was about 50% before China's WTO membership, and has risen to nearly 60% since then. There are also interesting variations across sectors. Those sectors that are likely labeled as relatively sophisticated such as electronic devices have particularly low domestic content (about 30% or less).
    Journal of Development Economics 09/2012; 99(1):178–189. · 2.13 Impact Factor
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    Shang-Jin Wei, Xiaobo Zhang, Yin Liu
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    ABSTRACT: While in standard housing economics housing is regarded as an asset and a consumption good, we study in this paper the consequences for housing prices if housing is also a status good. More concretely, if a family’s housing wealth relative to others is an important marker for relative status in the marriage market, then competition for marriage partners might motivate people to pursue a bigger and more expensive house/apartment beyond its direct consumption (and financial investment) value. To test the empirical validity of the hypothesis, we have to overcome the usual difficulty of not being able to observe the intensity of status competition. Our innovation is to explore regional variations in the sex ratio for the pre-marital age cohort across China, which likely has triggered variations in the intensity of competition in the marriage market. The empirical evidence appears to support this hypothesis. We estimate that due to the status good feature of housing, a rise in the sex ratio accounts for 30-48% of the rise in real urban housing prices in China during 2003-2009.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    04/2012;
  • Jennie Bai, Shang-Jin Wei
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    ABSTRACT: When a sovereign faces the risk of debt default, it may be tempted to expropriate the private sector. This may be one reason for why international investment in private companies has to take into account the sovereign risk. But the likelihood of a transfer from the sovereign risk to corporate default risks may be mitigated by legal institutions that provide strong property rights protection. Using a novel credit default swaps dataset covering both government and corporate entities across 30 countries, this paper studies both the average strength of the transfer risks and the role of institutions in mitigating such risks. We find that (1) sovereign risk on average has a statistically and economically significant influence on corporate credit risks. All else equal, a 100 basis points increase in the sovereign CDS spread leads to an increase in corporate CDS spreads by 71 basis points. (2) The sovereign-corporate relation varies across corporations, with state-owned companies exhibiting a stronger relation. (3) However, strong property rights institutions tend to weaken the connection. In contrast, contracting institutions (protection of creditor rights or minority shareholder rights) do not appear to matter much in this context.
    SSRN Electronic Journal 03/2012;
  • Jiandong Ju, Kang Shi, Shang-Jin Wei
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    ABSTRACT: Sticky (or slow-adjusting) current accounts are observed for many countries. This paper explores the role of domestic factor market flexibility in understanding the phenomenon. To do so, we consider multiple tradable sectors with different factor intensities and allow substitution between intertemporal trade (current account adjustment) and intra-temporal trade (goods trade) in a dynamic general equilibrium model. An economy’s response to a shock generally involves a combination of a change in the composition of goods trade and a change in the current account. Flexible factor markets reduce the need for the current account to adjust. On the other hand, the more rigid the factor markets, the larger the size of current account adjustment relative to the volume of goods trade, and the slower the speed of adjustment of the current account towards its long-run equilibrium. We present empirical evidence in support of the theory.
    02/2012;
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    Hui Tong, Shang-Jin Wei
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    ABSTRACT: How does increasing globalization affect corporate transparency? Freer trade represents different facets and in theory has ambiguous effects on corporate transparency. On the one hand, by exposing firms to more product market competition, it could discourage discretionary disclosure. On the other hand, by opening up foreign markets and enhancing firms’ growth opportunities, it may promote more transparency. Rather than simply estimating a net effect, this paper pursues an approach that allows separate estimation of the two potentially opposing channels. We employ three different measures of corporate transparency and track their evolutions for 4061 firms in 49 countries during 1992-2005. By using detailed product-level tariff schedules for these countries, we construct a measure of growth opportunities enabled by foreign tariff liberalizations at the sector-country-year level, and a second measure of globalization-induced product market competition based on a country’s own tariff liberalization (again at the sector–country-year level). We find strong evidence that higher growth opportunities engendered by globalization promotes corporate transparency, especially in industries that depend heavily on external financing. At the same time, we find somewhat weaker evidence that greater product market competition engendered by globalization discourages corporate transparency. The results demonstrate the importance of disentangling the multiple and potentially conflicting effects of globalization.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    Journal of International Economics 12/2011; · 1.73 Impact Factor
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    Robert C. Feenstra, Shang-Jin Wei
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    ABSTRACT: No abstract available.
    NBER Book Chapters. 11/2011;
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    Robert C. Feenstra, Shang-Jin Wei
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    ABSTRACT: No abstract available.
    NBER Book Chapters. 11/2011;
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    Zhi Wang, Shang-Jin Wei
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    ABSTRACT: No abstract available.
    NBER Book Chapters. 11/2011;
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    ABSTRACT: This paper explores how reductions in tari¤s on imported inputs and …nal goods a¤ect …rm productivity by exploiting the special tari¤ treatment that processing …rms apply on imported inputs as opposed to those of non-processing …rms. Highly disaggregated Chinese transaction-level trade data and …rm-level production data from 2000 to 2006 are used to construct …rm-level input and output tari¤s. Careful examination of the extent of …rm engagement in processing trade and in controlling for various sources of endogeneity reveal that less productive …rms choose to engage in processing trade. More importantly, unlike previous …ndings, reductions in output tari¤s have a greater e¤ect on productivity improvement compared with reductions in input tari¤s due, in large part, to the fact that processing trade in China enjoys zero tari¤s on imported inputs.
    11/2011;
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    ABSTRACT: This paper presents a new conceptual framework to measure sources of value-added trade by country in global production networks. With a parsimonious decomposition of gross exports that eliminates "double counting", it integrates all previous measures of vertical specialization and value-added trade in the literature. We apply the framework to the most recent appropriate data (2004). Among emerging markets, East Asian countries are the most globally integrated. Among major developed economies, the US is the most integrated in some aspects, and Japan in others. These regional differences also affect exporters’ trade costs.
    SSRN Electronic Journal 10/2011;
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    Jiandong Ju, Kang Shi, Shang-Jin Wei
    [Show abstract] [Hide abstract]
    ABSTRACT: Sticky (or slow-adjusting) current accounts are observed in many countries. This paper explores the role of domestic factor market flexibility in understanding the phenomenon. To do so, we consider multiple tradable sectors with different factor intensities and allow substitution between intertemporal trade (current account adjustment) and intra-temporal trade (goods trade) in a dynamic general equilibrium model. An economy’s response to a shock generally involves a combination of a change in the composition of goods trade and a change in the current account. Flexible factor markets reduce the need for the current account to adjust. On the other hand, the more rigid the factor markets, the larger the size of current account adjustment relative to the volume of goods trade, and the slower the speed of adjustment of the current account towards its long-run equilibrium. We present empirical evidence in support of the theory.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    Journal of International Economics 10/2011; · 1.73 Impact Factor
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    Stijn Claessens, Hui Tong, Shang-Jin Wei
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    ABSTRACT: Using accounting data for 7722 non-financial firms in 42 countries, we examine how the 2007-2009 crisis affected firm performance and how various linkages propagated shocks across borders. We isolate and compare effects from changes in external financing conditions, domestic demand, and international trade on firms’ profits, sales and investment using both sectoral benchmarks and firm-specific sensitivities estimated prior to the crisis. We find that the crisis had a bigger negative impact on firms with greater sensitivity to demand and trade, particularly in countries more open to trade. Interestingly, financial openness appears to have made limited difference.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
    Journal of International Economics 08/2011; · 1.73 Impact Factor
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    Mary Amiti, Shang-Jin Wei
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    ABSTRACT: No abstract available.
    NBER Book Chapters. 06/2011;
  • Shang-Jin Wei, Xiaobo Zhang
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    ABSTRACT: The high and rising household savings rate in China is not easily reconciled with the traditional explanations that emphasize life cycle factors, the precautionary saving motive, financial development, or habit formation. This paper proposes a new competitive saving motive: as the sex ratio rises, Chinese parents with a son raise their savings in a competitive manner in order to improve their son’s relative attractiveness for marriage. The pressure on savings spills over to other households. Both cross-regional and household-level evidence supports this hypothesis. This factor can potentially account for about half the actual increase in the household savings rate during 1990–2007.
    Journal of Political Economy 06/2011; 119(3):511-564. · 2.90 Impact Factor
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    Jiandong Ju, Kang Shi, Shang-Jin Wei
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    ABSTRACT: A wave of trade liberalizations take place in both developing and developed countries, including China's WTO accession and the end of import quotas on textile and garment in the United States and Europe. At the same time, both China's current account surplus and the US deficit have risen to an unprecedented level. Are these developments related? We study how trade reforms affect current accounts by embedding a modified Heckscher-Ohlin structure and an endogenous discount factor into an intertemporal model of current account. We show that trade liberalizations in a developing country would generally lead to capital outflow. In contrast, trade liberalizations in a developed country would result in capital inflow. Thus, trade reforms can contribute to global imbalances.
    05/2011;
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    ABSTRACT: Developing countries traditionally experience pass-through of exchange rate changes that is greater and more rapid than high-income countries experience. This is true equally of the determination of prices of imported goods, prices of local competitors’ products, and the general CPI. But developing countries in the 1990s experienced a rapid downward trend in the degree of pass-through and speed of adjustment, more so than did high-income countries. As a consequence, slow and incomplete pass-through is no longer exclusively a luxury of industrial countries. Using a new data set—prices of eight narrowly defined brand commodities, observed in 76 countries—we find empirical support for some of the factors that have been hypothesized in the literature, but not for others. Significant determinants of the pass-through coefficient include per capita incomes, bilateral distance, tariffs, country size, wages, long-term inflation, and long-term exchange rate variability. Some of these factors changed during the 1990s. Part (and only part) of the downward trend in pass-through to imported goods prices, and in turn to competitors’ prices and the CPI, can be explained by changes in the monetary environment—including a fall in long-term inflation. Real wages work to reduce pass-through to competitors’ prices and the CPI, confirming the hypothesized role of distribution and retail costs in pricing to market. Rising distribution costs, due perhaps to the Balassa-Samuelson-Baumol effect, could contribute to the decline in the pass-through coefficient in some developing countries.
    Open Economies Review 04/2011; 23(2):213-251. · 0.44 Impact Factor

Publication Stats

4k Citations
92.57 Total Impact Points

Institutions

  • 2013
    • The National Bureau of Economic Research
      Cambridge, Massachusetts, United States
  • 2008–2012
    • Columbia University
      New York City, New York, United States
  • 1994–2012
    • Tsinghua University
      • School of Economics and Management
      Peping, Beijing, China
  • 2011
    • The University of Hong Kong
      Hong Kong, Hong Kong
    • Peking University
      • China Center for Economic Research
      Beijing, Beijing Shi, China
  • 2007
    • Vanderbilt University
      • Owen Graduate School of Management
      Nashville, MI, United States
  • 2003
    • International Monetary Fund
      Washington, Washington, D.C., United States
  • 1995–2002
    • Harvard University
      • Department of Economics
      Cambridge, Massachusetts, United States
  • 1999–2000
    • University of California, Davis
      Davis, California, United States