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C hina and Global Imbalances from a View of Sectorial Reforms
Author(s) -
Ito Hiro,
Volz Ulrich
Publication year - 2013
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/roie.12020
Subject(s) - china , economics , liberalization , capital account , economic reform , current account , international economics , global imbalances , capital (architecture) , development economics , macroeconomics , market economy , political science , history , archaeology , exchange rate , law
This article examines the impact of sectorial reforms on current account imbalances, with a special focus on C hina. In particular, we investigate to what extent reforms pertaining to the financial sector, social protection, and healthcare may contribute to a rebalancing of C hina's persistent current account imbalances. Our forecasting results suggest that reforming the financial sector would be a significant contributor to the country's rebalancing with an effect much larger than that of capital account liberalization. Strengthened provisions of social protection and publicly‐funded healthcare are also found to contribute to a rebalancing of the Chinese economy.