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.
Understanding Conflict: What China's Warlord Era Tells Us
A draft can be found: [pdf].
Abstract: This paper studies the impact of civil conflict on inter-regional economic activity, with a focus on trade between provinces and treaty ports during China’s Warlord Era (1916-1928). Trade with treaty ports was the major channel through which provinces acquired foreign goods, especially advanced industrial products, and thus played an important role in regional industrialization. Warlords strategically formed or left military factions due to conflict. These changes in military alliances among warlords affected economic connections among the regions they controlled. Exploiting newly digitized internal trade data, I show that the trade cost between a province and a treaty port increased significantly when they were controlled by warlords in different military factions using a structural gravity model. The rise in trade costs led to increases in prices of foreign goods in local markets. Using the 1917 Russian Revolution as an exogenous supply shock, I show that the demand for foreign goods was elastic. Together, the results imply that conflict reduced the local demand for foreign goods substantially, which had a profound impact on regional development. Moreover, the impact of conflict varied across regions due to heterogeneities in treaty ports and demand elasticities, which provides insights into the observed regional disparities during the Warlord Era.
Consumer Activism as Political Weapon: the 2021 Xinjiang Cotton Boycott
A draft can be found: [pdf].
Abstract: The paper studies how governments weaponize consumer activism to target unaligned firms. In the summer of 2020, companies associated with the Better Cotton Initiative issued statements expressing concern about forced labor in Xinjiang areas. Months later, these statements spread across Chinese social media and drew public attention. Under the influence of posts by government social media accounts, Chinese consumers believed these accusations were irresponsible and disrespectful, and they began to boycott the companies that issued these statements. Using the firm-level regional sales data and the triple-differences approach, I show that the boycott decreased the sales of boycotted firms by 39%, while the boycott accelerated Chinese firms' growth. The negative impact on boycotted firms is further supported by an event study: stock returns of boycotted firms drop significantly by around 7% immediately after the boycott and did not recover days after.
Undergraduate 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)