Application of the Input-Output Decomposition Technique to China's Regional Economies

Structural decomposition techniques based on input-output table have become a widely used tool for analyzing long term economic growth. However, due to limitations of data, such techniques have never been applied to China's regional economies. Fortunately, in 2003, China's Interregional Input-Output Table for 1987 and Multi-regional Input-Output Table for 1997 were published, making decomposition analysis of China's regional economies possible. This paper first estimates the interregional input-output table in constant price by using an alternative approach: the Grid-Search method, and then applies the standard input-output decomposition technique to China's regional economies for 1987-97. Based on the decomposition results, the contributions to output growth of different factors are summarized at the regional and industrial level. Furthermore, interdependence between China's regional economies is measured and explained by aggregating the decomposition factors into the intraregional multiplier-related effect, the feedback-related effect, and the spillover-related effect. Finally, the performance of China's industrial and regional development policies implemented in the 1990s is briefly discussed based on the analytical results of the paper.

The Taiwan Strait Crisis of 1954-55 and U.S.-R.O.C Relations

On September 3, 1954, Chinese artillery began shelling Quemoy (Jinmen), one of the Kuomintang-held offshore islands, setting off the first Taiwan Strait Crisis. This paper focuses on the crisis and analyzes the following three questions: (1) What was the policy the U.S. took towards the Republic of China (R.O.C), especially towards the offshore islands, to try to end the Taiwan Strait Crisis? (2) What were the intentions of the U.S. government in trying to end the Taiwan Strait Crisis? And (3) how should U.S. policy towards the R.O.C. which led to solving the Taiwan Strait Crisis be positioned in the history of Sino-American relations? Through analysis of these questions, this study concludes that the position the U.S. took to bring an end to crisis, one which prevented China from “liberating Taiwan” and the Kuomintang from “attacking the mainland,” brought about the existence of a de facto “two-China” situation.