Book Description

The first essay focuses on the role of the hukou (i.e. Household Registration System) with full awareness of the economic system it operates under, and the development model it assists. I find that hukou's main role in the planned economy was to assist socialist industrialization while averting the Lewis development model, a development strategy based on unlimited supply of labors from the rural sector, largely adopted in developing countries. In the market reform period, hukou performed exactly the opposite function, which is to assist the Lewis model based on the unlimited supply of rural surplus labor "released" from the rural de-collectivization. Based on these results, I argue that the interacting effects of the hukou and the economic system, rather than hukou alone, should be the analytical focus to address important development topics such as industrialization, urbanization, spatial and social inequality. The second essay compares the different agricultural investment patterns when agricultural credit is borrowed on a collective basis versus on an individual basis. I find that on the same income level, a one percent increase in the IC ratio (i.e. the ratio of loan made on individual base relative to on a collective base) leads to of a two percentage point decline on irrigation investment. On the other hand, a one percent increase in the IC ratio leads to about 10 percentage point increase in fertilizer use. Based on these results, I argue that the form of agricultural lending matters significantly in decisions regarding agricultural investments. Collective-based agricultural lending tends to be channeled to investment that contributes to more sustainable agricultural development yet with returns only in the intermediate or long run (such as irrigation). The third essay addresses the employment issue through estimating the relative employment impacts of renewable energy investments versus spending within the traditional fossil fuel sectors. I find that spending within three segments of the renewable energy sectors - solar, wind and bioenergy, will produce in combination about twice as many jobs per dollar of expenditure than an equal amount of spending on fossil fuels. I also find that, more than 70% of jobs from renewable energy sectors are created in the informal economy. Overall, the results of my estimates demonstrate that, for the case of China, the project of building a clean energy economy does not face the prospect of a massive obstacle in terms of negative employment effects.