A New Tri-channel Decomposition of External Adjustment:Model and Application

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外文摘要：In this study,we expanded upon the current benchmark model of external adjustment and dissected the concept of international financial adjustment into two distinct components:valuation effect and investment income.Our enhanced model,which we refer to as"tri-channel model,"incorporates three key elements:trade balance,valuation effect,and investment income.Using a consolidated quarterly dataset that encompassed China s balance of payments and international investment positions from 1998 to 2020,we estimated the relative importance of the three newly introduced adjustment channels to Chinas cyclical external imbalance.We found that the trade balance channel played a major role,accounting for approximately 76 percent of cyclical external adjustment.The contribution of the investment income channel to cyclical external adjustment(21 percent)was much greater than that of the valuation effect channel(3 percent).These findings imply that policy responses to the cyclical external imbalance in China should focus more on the trade balance and investment incomes channels rather than exploiting the valuation effects.

外文关键词：

external adjustmentinvestment incometrade balancevaluation effect

作者：

Wangyin Hu、Guangtao Xia、Yingting Li

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作者单位：

School of Economics and Finance,University of International Relations,China

Institute of World Economics and Politics,Chinese Academy of Social Sciences,China

Bank of China Research Institute,China

基金：

Fundamental Research Funds for Central Universities,University of International RelationsPeak Strategy of Discipline Construction of the Chinese Academy of Social SciencesLaboratory of World Economic Forecasting and Policy Simulation of the Institute of World Economics and Politics of the Chine

项目编号：

3262024T23DF2023YS412024SYZH003

出版年：

2024

中国与世界经济(英文版)

中国社会科学院世界经济与政治研究所

中国与世界经济(英文版)

ISSN：1671-2234

年,卷(期)：2024.32(4)