Working Papers
Trade, Industrialization, and Regional Disparities: Evidence from China during the Warlord Era
A draft can be found: [pdf].
Abstract: How does foreign trade shape regional economic development in late-developing countries during periods of political instability, particularly in the absence of effective trade policies? This paper addresses the question using the important example of China during the Warlord Era (1912-1928). The Warlord Era was a time of political instability following the collapse of the Qing dynasty. Paradoxically, it also witnessed China’s first wave of large-scale industrialization, when thousands of private industrial firms emerged. Exploiting the spatial pattern of new industrial firms, I develop a market-driven mechanism of industrialization: after the liberalization of private initiatives, foreign trade access influenced private participants' entry decisions through its impact on market prices. Using a firm entry model and newly collected trade data, I demonstrate that access to foreign capital goods relative to foreign consumer goods determined the number of new industrial firms. A 1% increase in the arrival price of consumer goods led to a 2.7% increase in industrial firm entry, while a 1% increase in capital goods prices resulted in a 1.5% decrease. These findings highlight the distinct impact of foreign trade in late-developing countries compared to early-industrializing countries. Moreover, they suggest that liberalized markets alone could induce some industrialization. Private participants, even in less developed areas, responded to market forces. If the Qing government had lifted entry restrictions earlier, industrialization could have begun sooner.
A draft can be found: [pdf].
Abstract: How does foreign trade shape regional economic development in late-developing countries during periods of political instability, particularly in the absence of effective trade policies? This paper addresses the question using the important example of China during the Warlord Era (1912-1928). The Warlord Era was a time of political instability following the collapse of the Qing dynasty. Paradoxically, it also witnessed China’s first wave of large-scale industrialization, when thousands of private industrial firms emerged. Exploiting the spatial pattern of new industrial firms, I develop a market-driven mechanism of industrialization: after the liberalization of private initiatives, foreign trade access influenced private participants' entry decisions through its impact on market prices. Using a firm entry model and newly collected trade data, I demonstrate that access to foreign capital goods relative to foreign consumer goods determined the number of new industrial firms. A 1% increase in the arrival price of consumer goods led to a 2.7% increase in industrial firm entry, while a 1% increase in capital goods prices resulted in a 1.5% decrease. These findings highlight the distinct impact of foreign trade in late-developing countries compared to early-industrializing countries. Moreover, they suggest that liberalized markets alone could induce some industrialization. Private participants, even in less developed areas, responded to market forces. If the Qing government had lifted entry restrictions earlier, industrialization could have begun sooner.
Foreign Trade in Times of Civil Conflict: Evidence From China during the Warlord Era
A draft can be found: [pdf].
Abstract: International trade requires moving goods both across borders and within countries, so both international and domestic trade costs are important. While an extensive literature examines the impact of World War I on international trade costs, much less is known about how civil conflict influenced domestic trade costs. This paper addresses this question using China during the Warlord Era (1912-1928). Applying a gravity model, I find that belonging to different military factions significantly increased domestic trade costs. Leveraging the 1917 Russian Revolution as an exogenous supply shock, I show that the demand for foreign goods was elastic and varied across regions. These findings demonstrate that civil conflict had a significant impact on foreign trade at both the national level and the regional level.
A Geographic Accident? Coal Markets in Early Republican China
A draft can be found: [pdf].
This paper examines the development of coal markets in China during the Early Republican period (1912–1919) using newly digitized county-level data on coal prices and output. The findings show that coal markets rapidly integrated between 1912 and 1915, following market liberalization after the collapse of the Qing dynasty, but fragmented again with the onset of warlordism. The entry of private small coal mines played an important role in this brief period of integration. The high energy costs faced by commercial centers during the Qing were not purely the result of geographic misfortune, but also a consequence of unfavorable institutions.
Publications
RMSE-minimizing confidence intervals for the binomial parameter [pdf]
with Lawrence M. Leemis (W&M) and Heather Sasinowska (W&M)
with Lawrence M. Leemis (W&M) and Heather Sasinowska (W&M)