Growth and Convergence: The case of China

Growth and Convergence: The Case of China Since the initiation of economic reforms in 1978, China has become one of the world’s fast-growing economies. The rapid growth, however, has not been shared equally across the different regions in China. The prominent feature of substantial differences in incomes and growth rates across the different Chinese regions has attracted the attention of many researchers. This book focuses on issues related to economic growth and convergence across the Chinese regions over the past three decades. The book has eight chapters. Apart from an introduction chapter and a concluding chapter, all the other chapters each deal with some certain aspects of the central issue of regional growth and convergence across China over the past three decades. The whole book is organized as follows. Chapter 1 provides an introduction to the basic issues involved in this book. Chapter 2 tests economic growth and convergence across 31 Chinese provinces during 1981-2005, based on the theoretical framework of the Solow growth model. Chapter 3 investigates the relationship between openness to foreign economic activities, such as foreign trade and foreign direct investment, and the regional economic growth in the case of China during 1981-2005. Chapter 4, based on data of 31 Chinese provinces over the period 1980-2004, presents new evidence on the effects of structural shocks and structural transformation on growth and convergence among the Chinese regions. Chapter 5, by building up an empirical model that takes account of different potential effects of foreign direct investment, focuses on the impacts of foreign direct investment on China’s regional economic performance and growth. Chapter 6 reconsiders the growth and convergence problem of the Chinese regions in an alternative theoretical framework with endogenous saving behavior and capital mobility across regions. Chapter 7, by building up a theoretical model concerning comparative advantage and transaction efficiency, focuses on one of the potential mechanisms through which China achieves its fast economic growth over the past few decades. Chapter 8 concludes the book by summarizing the results from the previous chapters and suggesting directions for further studies.

Stand growth and management scenarios for Paraserianthes falcataria smallholder plantations in Indonesia

Paraserianthes falcataria is a very fast growing, light wood tree species, that has recently gained wide interest in Indonesia for industrial wood processing. At the moment the P. falcataria plantations managed by smallholders are lacking predefined management programmes for commercial wood production. The general objective of this study was to model the growth and yield of Paraserianthes falcataria stands managed by smallholders in Ciamis, West Java, Indonesia and to develop management scenarios for different production objectives. In total 106 circular sample plots with over 2300 P. falcataria trees were assessed on smallholder plantation inventory. In addition, information on market prices of P. falcataria wood was collected through rapid appraisals among industries. A tree growth model based on Chapman-Richards function was developed on three different site qualities and the stand management scenarios were developed under three management objectives: (1) low initial stand density with low intensity stand management, (2) high initial stand density with medium intensity of intervention, (3) high initial stand density and strong intensity of silvicultural interventions, repeated more than once. In general, the 9 recommended scenarios have rotation ages varying from 4 to 12 years, planting densities from 4x4 meters (625 trees ha-1) to 3x2 meters (1666 trees ha-1) and thinnings at intensities of removing 30 to 60 % of the standing trees. The highest annual income would be generated on high-quality with a scenario with initial planting density 3x2 m (1666 trees ha-1) one thinning at intensity of removing 55 % of the standing trees at the age of 2 years and clear cut at the age of 4 years.

Silvicultural decisions based on simulation-optimization systems

Forest management is facing new challenges under climate change. By adjusting thinning regimes, conventional forest management can be adapted to various objectives of utilization of forest resources, such as wood quality, forest bioenergy, and carbon sequestration. This thesis aims to develop and apply a simulation-optimization system as a tool for an interdisciplinary understanding of the interactions between wood science, forest ecology, and forest economics. In this thesis, the OptiFor software was developed for forest resources management. The OptiFor simulation-optimization system integrated the process-based growth model PipeQual, wood quality models, biomass production and carbon emission models, as well as energy wood and commercial logging models into a single optimization model. Osyczka s direct and random search algorithm was employed to identify optimal values for a set of decision variables. The numerical studies in this thesis broadened our current knowledge and understanding of the relationships between wood science, forest ecology, and forest economics. The results for timber production show that optimal thinning regimes depend on site quality and initial stand characteristics. Taking wood properties into account, our results show that increasing the intensity of thinning resulted in lower wood density and shorter fibers. The addition of nutrients accelerated volume growth, but lowered wood quality for Norway spruce. Integrating energy wood harvesting into conventional forest management showed that conventional forest management without energy wood harvesting was still superior in sparse stands of Scots pine. Energy wood from pre-commercial thinning turned out to be optimal for dense stands. When carbon balance is taken into account, our results show that changing carbon assessment methods leads to very different optimal thinning regimes and average carbon stocks. Raising the carbon price resulted in longer rotations and a higher mean annual increment, as well as a significantly higher average carbon stock over the rotation.

Essays on the Economics of Intellectual Property Rights

Väitöskirjassani tarkastelen informaatiohyödykkeiden ja tekijänoikeuksien taloustiedettä kahdesta eri perspektiivistä. Niistä ensimmäinen kuuluu endogeenisen kasvuteorian alaan. Väitöskirjassani yleistän ”pool of knowledge” -tyyppisen endogeenisen kasvumallin tilanteeseen, jossa patentoitavissa olevalla innovaatiolla on minimikoko, ja jossa uudenlaisen tuotteen patentoinut yritys voi menettää monopolinsa tuotteeseen jäljittelyn johdosta. Mallin kontekstissa voidaan analysoida jäljittelyn ja innovaatioilta vaaditun ”minimikoon” vaikutuksia hyvinvointiin ja talouskasvuun. Kasvun maksimoiva imitaation määrä on mallissa aina nolla, mutta hyvinvoinnin maksimoiva imitaation määrä voi olla positiivinen. Talouskasvun ja hyvinvoinnin maksimoivalla patentoitavissa olevan innovaation ”minimikoolla” voi olla mikä tahansa teoreettista maksimia pienempi arvo. Väitöskirjani kahdessa jälkimmäisessä pääluvussa tarkastelen informaatiohyödykkeiden kaupallista piratismia mikrotaloustieteellisen mallin avulla. Informaatiohyödykkeistä laittomasti tehtyjen kopioiden tuotantokustannukset ovat pienet, ja miltei olemattomat silloin kun niitä levitetään esimerkiksi Internetissä. Koska piraattikopioilla on monta eri tuottajaa, niiden hinnan voitaisiin mikrotaloustieteen teorian perusteella olettaa laskevan melkein nollaan, ja jos näin kävisi, kaupallinen piratismi olisi mahdotonta. Mallissani selitän kaupallisen piratismin olemassaolon olettamalla, että piratismista saatavan rangaistuksen uhka riippuu siitä, kuinka monille kuluttajille piraatti tarjoaa laittomia hyödykkeitä, ja että se siksi vaikuttaa piraattikopioiden markkinoihin mainonnan kustannuksen tavoin. Kaupallisten piraattien kiinteiden kustannusten lisääminen on mallissani aina tekijänoikeuksien haltijan etujen mukaista, mutta ”mainonnan kustannuksen” lisääminen ei välttämättä ole, vaan se saattaa myös alentaa laillisten kopioiden myynnistä saatavia voittoja. Tämä tulos poikkeaa vastaavista aiemmista tuloksista sikäli, että se pätee vaikka tarkasteltuihin informaatiohyödykkeisiin ei liittyisi verkkovaikutuksia. Aiemmin ei-kaupallisen piratismin malleista on usein johdettu tulos, jonka mukaan informaatiohyödykkeen laittomat kopiot voivat kasvattaa laillisten kopioiden myynnistä saatavia voittoja jos laillisten kopioiden arvo niiden käyttäjille riippuu siitä, kuinka monet muut kuluttajat käyttävät samanlaista hyödykettä ja jos piraattikopioiden saatavuus lisää riittävästi laillisten kopioiden arvoa. Väitöskirjan viimeisessä pääluvussa yleistän mallini verkkotoimialoille, ja tutkin yleistämäni mallin avulla sitä, missä tapauksissa vastaava tulos pätee myös kaupalliseen piratismiin.

Production process of Scots pine.

The accompanying collective research report is the result of the research project in 1986­90 between The Finnish Academy and the former Soviet Academy of Sciences. The project was organized around common field work in Finland and in the former Soviet Union and theoretical analyses of tree growth determining processes. Based on theoretical analyses, dynamic stand growth models were made and their parameters were determined utilizing the field results. Annual cycle affects the tree growth. Our theoretical approach was based on adaptation to local climate conditions from Lapland to South Russia. The initiation of growth was described as a simple low and high temperature accumulation driven model. Linking the theoretical model with long term temperature data allowed us to analyze what type of temperature response produced favorable outcome in different climates. Initiation of growth consumes the carbohydrate reserves in plants. We measured the dynamics of insoluble and soluble sugars in the very northern and Karelian conditions. Clear cyclical pattern was observed but the differences between locations were surprisingly small. Analysis of field measurements of CO2 exchange showed that irradiance is the dominating factor causing variation in photosynthetic rate in natural conditions during summer. The effect of other factors is so small that they can be omitted without any considerable loss of accuracy. A special experiment carried out in Hyytiälä showed that the needle living space, defined as the ratio between the shoot cylindric volume and needle surface area, correlates with the shoot photosynthesis. The penetration of irradiance into Scots pine canopy is a complicated phenomenon because of the movement of the sun on the sky and the complicated structure of branches and needles. A moderately simple but balanced forest radiation regime submodel was constructed. It consists of the tree crown and forest structure, the gap probability calculation and the consideration of spatial and temporal variation of radiation inside the forest. The common field excursions in different geographical regions resulted in a lot of experimental data of regularities of woody structures. The water transport seems to be a good common factor to analyse these properties of tree structure. There are evident regressions between cross-sectional areas measured at different locations along the water pathway from fine roots to needles. The observed regressions have clear geographical trends. For example, the same cross-sectional area can support three times higher needle mass in South Russia than in Lapland. Geographical trends can also be seen in shoot and needle structure. Analysis of data published by several Russian authors show, that one ton of needles transpire 42 ton of water a year. This annual amount of transpiration seems to be independent of geographical location, year and site conditions. The produced theoretical and experimental material is utilised in the development of stand growth model that describes the growth and development of Scots pine stands in Finland and the former Soviet Union. The core of the model is carbon and nutrient balances. This means that carbon obtained in photosynthesis is consumed for growth and maintenance and nutrients are taken according to the metabolic needs. The annual photosynthetic production by trees in the stand is determined as a function of irradiance and shading during the active period. The utilisation of the annual photosynthetic production to the growth of different components of trees is based on structural regularities. Since the fundamental metabolic processes are the same in all locations the same growth model structure can be applied in the large range of Scots pine. The annual photosynthetic production and structural regularities determining the allocation of resources have geographical features. The common field measurements enable the application of the model to the analysis of growth and development of stands growing on the five locations of experiments. The model enables the analysis of geographical differences in the growth of Scots pine. For example, the annual photosynthetic production of a 100-year-old stand at Voronez is 3.5 times higher than in Lapland. The share consumed to needle growth (30 %) and to growth of branches (5 %) seems to be the same in all locations. In contrast, the share of fine roots is decreasing when moving from north to south. It is 20 % in Lapland, 15 % in Hyytiälä Central Finland and Kentjärvi Karelia and 15 % in Voronez South Russia. The stem masses (115­113 ton/ha) are rather similar in Hyytiälä, Kentjärvi and Voronez, but rather low (50 ton/ha) in Lapland. In Voronez the height of the trees reach 29 m being in Hyytiälä and Kentjärvi 22 m and in Lapland only 14 m. The present approach enables utilization of structural and functional knowledge, gained in places of intensive research, in the analysis of growth and development of any stand. This opens new possibilities for growth research and also for applications in forestry practice.