Abstract： Social security system in essence is an important system arrangement in modern society that prevents social risks of workers and social members mitigate the income distribution gap， promote social harmony. International experience shows that social security‘s role in narrowing income gap is more than the tax system; social security is the main tool of moderating income redistribution. In this paper， the strict sampling questionnaire survey data of “China‘s Social Security and Income Distribution” research group in 2011—2013 years shows that， China’s social security system has become an important part of the income of urban and rural residents， social security plays an important role in regulate income distribution. On the whole， social security system is narrowing the income gap， but does exist some system arrangement is widening income gap. Therefore， the government should vigorously develop the basic social security system， make it really become the main carrier to embody the government responsibilities and social public service， strive to improve the fairness of the social security system.
Key Words： Social Security; Income Redistribution; Moderating Effect; Social Fairness

Abstract： From the perspective of news shocks， this paper distinguishes and studies the effects of both the anticipated and unanticipated monetary policy shocks on China's inflation in a New Keyesian DSGE model. Furthermore， we analyze the characteristics and mechanism of China's monetary policy by Sino-US policy effect comparison， and the replacement of parameters and expectation structure. The conclusions are as follows： (1) The impacts of the anticipated shocks are much stronger than the unanticipated ones in China. (2) Compared with the case of the United State， China's monetary policy has a larger and less persistent effect together with a minor overshooting feature. (3)The above characteristics origin from the incoherency of the monetary policy conducted by the central bank and the short-sighted expectation from the economic agents. The policy implications are derived： (1) To make monetary policy more effective， the central bank should guide the public's expectations by means of central bank communications， etc. (2)The central bank should try to avoid discretion in order to maintain the consistency of monetary policy. (3) The implementation of monetary policy should keep its deeds with its words. In sum， China's monetary policy should be more transparent， coherent and credible.
Key Words： Monetary Policy Expectations; Inflation Management; News Shocks; DSGE

Abstract： Generally speaking， fiscal expansion will lead to inflation. This paper will reconsider this issue by introducing productive government expenditure into a new Keynesian model， and estimating it by Bayesian methods using the sample from 1998：1 to 2013：4We find that (1) productive fiscal policy can influence inflation dynamics through both aggregate demand and aggregate supply channel. Although the former may trigger inflation， the latter will depress it. The relative strength depends on the productivity of the government expenditure; (2) Based on Chinese quarterly data， we find that inflation was not mainly caused by fiscal stimulus in sample period. In addition， these discoveries are robust to different form of utility function， investment adjustment cost function and alternative specifications on labor market. By examining the effects of fiscal news shock， we find that revealing relevant information about future policy in advance is helpful to stabilize the public's expectation.
Key Words： Productive Government Expenditure; Aggregate Supply; Inflation

Abstract： According to the internal logic of fiscal decentralization and financial decentralization， assuming the internal consistency between their spatial effects， and validating by using the economic data of Chinese 1978—2012 years， the result shows that： during the process of fiscal decentralization， the financial invisibly has a certain amount of decentralization， and is similar to fiscal decentralization on spatial effect. The financial decentralization has double feature with external centralization and internal decentralization， which is significantly different from the dominant financial centralization. Under conditions of limited lateral accountability mechanisms and imperfect vertical accountability mechanisms， local government must expand their economic interests with the core of fiscal income and the radius of power influence form the budget income， bank loans， bank table foreign assets and other financial resources， and transfer the risks burden to the country， which continuous brewing and accumulation of financial risks. The method of financial completely decentralized cannot effectively solve this problem， the key lies in two things： first， how to enable local governments to match the risk and return; the second is to finance a modest decentralization.
Key Words： Fiscal Decentralization; Financial Decentralization; Spatial Effects

Abstract： Consumption scale， especially the resident consumption scale， is a necessary condition for the sustainable and stable growth of a large country economy. The contradiction of demand structure has become a deep contradiction of constraining the sustainable and stable economic growth in China. Only with the combination of consumption scale enlargement and supply-side reform， which aims to help the largescaled resident consumption to be satisfied mainly in domestic market， the advantages of large country can be fully used. This paper makes an empirical test on the data of 1955—2013 by using Threshold Cointegration Model. The results show that the long-term effect of Chinese resident consumption scale to economic growth will change along with the changes of resident consumption rate. The results proved the existence of scale effect of Chinese resident consumption， and this effect has different working mechanisms in different consumption scales， which leads to different influence effects. More specifically， when the resident consumption scale level is below 0.539， if the resident consumption rate rises 0.1， the second annual economic growth rate will only rise 0.077; when the resident consumption rate level is above 0.539， if the resident consumption scale rises 0.1， the second annual economic growth rate will rise 0.121. After Economic Reform， the contribution of resident consumption to economic growth keeps declining， and the economic growth mainly depends on investment driven. Therefore， the key to realize the change of economic growth mode from investment driven to the demand pull in China is to expand resident consumption scale， and to carry out supply-side reform to help the demand of resident consumption to be met effectively by domestic market.
Key Words： Resident Consumption; Scale Effect; Evolution Mechanism

Abstract： This paper uses housing price as a linking factor and integrates the Kuznets “Long Swing” in demographic economics and the hierarchical urban systems model in geoeconomics. We build a CGE model for China's Long Swing， and use demographic and macroeconomic data of Japan to estimate the model， and then use it to analyze the long-term impact of population aging and migration on China's economic growth， urbanization and housing prices in 2015—2050-We also add financial leverage and rational expectation factors to the model， so as to study the linkage between financial leverage， economic growth and demographic polices. We find that the aging problem will cause a step-down of China's economic growth rate in 2021—2025， which will trigger off the slide of housing prices across the country， and cause the phenomenon of de-urbanization. In order to maintain longterm sustainable growth， we must focus on the three key rates： First， the total fertility rate (TFR). If the government adopts policies to raise the TFR， economic growth will be stimulated both in the shortterm and in the long-term. Second， the migration rate. Easier migration polices will help upgrade the economy and thus increase the growth rate. Third， the financial leverage ratio. Flexible adjustment of the leverage ratio with a long-term ceiling in mind will help stabilize economic growth. In addition， excessive limitation on the naturally rising leverage ratio will hurt economic growth.
Key Words： Population Aging; Migration; Financial Leverage; CGE Model

Abstract：Solow (1958) proposed a two-factor model in which change of aggregate share of labor reward was decomposed into industrial structure effects and intraindustry effect.This paper constructs an industrial structure model based on input-output model，describing the product mix of final demand and the relationship between final product's value chain structure and industrial structure.We link our model with Solow's twofactor model concerning the shift of aggregate share of labor reward and extend the industrial structure factor within it.Consequently，we decompose the aggregate shift into final demand structure effect，value chain structure effect and intraindustry effect.Empirical analysis on China suggests that intra-industry effect contributes 70.2% to the fall of share of labor reward，with value chain structure effect the 23.2% and final demand structure effect the 6.6% which is the lowest.
Key Words：Share of Labor Reward; Industrial Structure; Input-output Model

Abstract：In the paper， I propose a new formula and reevaluate the contribution of agricultural labor migration to economic growth in China. I found that (1) measurement error appears frequently when we evaluate the contribution with the classical formula of labor reallocation effect. Based on Massell's model with labor heterogeneity， I get an approximate formula with comparative advantage. (2) The contribution is decreasing with time and its fluctuation is similar with those of economic growth from 1985 to 2011(3) Since market-oriented reform， the potential of promoting economic growth through agricultural labor migration is great， but it is always underused due to the existing institutional environment which gives rise to labor heterogeneity in nonagricultural sector and schooling trap in rural labor forces. (4) We can still do something to sustain “China miracle” through agricultural labor migration and by means of institutional innovation.
Key Words：Labor Migration; Labor Heterogeneity; Reallocation Effect; Economic Growth

Abstract：Providing cheap credit fund to rural residents needs to look into the main body that is usually controlled by elite with low transaction cost. In the long term， the behavior of elite deviates from the overall interests， and “elite capture” mechanism is developed in rural credit market. This paper conducts an empirical research based on the data of the questionnaires survey from 10 provinces in China， to study the “elite capture” mechanism of rural credit market via the 2SLS model and IVQR model. The results showed that the “elite capture” mechanism in non-poor counties is significantly different from that of poor counties. “Elite capture” mechanism of rural credit market in poor counties has not been formed completely. In contrast to non-poor counties where “elite capture” mechanism is widely distributed over rural credit market， leading to structure distortions， function dislocation and target deviation. It's necessary to establish an inclusive financial system to break the existing configuration， to ensure fair transfer of funds and to establish a co-development mechanism.
Key Words： Loan for Rural Residents; Elite Capture; 2SLS Model; IVQR Model

Abstract：State-owned enterprises relative to non stateowned enterprises operating in the environment of bias policy， is a typical feature of China's micro enterprise operation. This paper trying to reveal policy distortions and efficiency losses from biased policy. Therefore， this paper firstly using propensity matching score method analysis the benchmark structure of state owned enterprises; secondly， this paper estimates policy distortions of bias policy. Finally， using Hsleh & Klenow (2009) to estimate economic efficiency loss. Research shows that， firstly， influence of bias policy does exist， not only caused the policy distortion but also lead to economic efficiency loss. Secondly， Bias policy mainly through output distortion and large enterprise bring losses to the economy. Thirdly， biased policy provides a “greenhouse” to most of the stateowned enterprises， so that most of the stateowned enterprises has tendency of blind expansion. Fourthly， efficiency losses caused by bias policy are decreasing， which come from two channels： one is the number of state-owned enterprises decreased significantly， the other is the loss of efficiency of stateowned enterprises have dropped in a single. On the reflection on the reform of state-owned enterprises， excess capacity management， finding a new engine of economic growth， this paper will have the important theory value and practical significance.
Key Words：Bias Policy; Resource Allocation; Output Distortions; Capital Distortions

Abstract：Climate change is a typical global environmental problem with complicity， long-range， and externality. Climate change cost-benefit analysis on social welfare impacts is an effective policy tool for adapting to climate change. Based on IPCC conceptual framework and theory of welfare economics， this article builds a BergsonSamuelson social welfare function， and evaluates climate change vulnerability and economic welfare risk so as to support adaptation planning. Firstly， the vulnerability assessment reveals a significant importance of climate sensitivity on welfare components and regional vulnerability to climate change. Secondly， more than 30 China's provinces are classified as three prototypes with comparing their climate sensitivity and adaptive capacity， which is named as developmental adaptation prioritized zone， incremental adaptation prioritized zone， and mixed zone. Thirdly， in order to establish regional priorities for adaptation planing， regional welfare weights are used into climatic disaster damage function and risk assessment during 2016 to 2030 under RCP8.5 climate modeling， while three feasible governance models are suggested to be leading by local， sectoral or central governmental level based on capability approach， needs approach or most-vulnerable-first principle separately.
Key Words：Climate Change; Vulnerability; Adaptation Planning; Social Welfare Function; Climate Change Economics

Abstract：Using Chinese Urban Household Survey (CUHS) data from 2007 to 2009， this paper adopts a regression discontinuity (RD) design to examine the effect of implementation of Compulsory Education Law (CEL) on individuals' schooling years and estimate the economic return of education. The three main empirical findings of this paper includes： first， the local treatment effect of CEL is about 0.4 year; second， the RD estimation shows that the economic return to education is about 12.8 percent in urban China， higher than that of OLS estimation; and third， the economic return in highincome group is higher than that in low-income group， implying that education generates “Matthew Effect” in urban China to some degree. This paper confirms the positive role of CEL on China's education development， presents new evidence on the estimation of economic return to education and enriches the existing literature on China's education studies from a methodological perspective.
Key Words：Compulsory Education Law; Economic Return to Education; Regression Discontinuity Design; Instrumental Variable Method

Abstract：With the use of generalized difference-in-differences estimations， this paper investigates the impact of the One-child Policy (OCP) on mental health. Under OCP， the only child in the family is over protected. However， when they leave the cozy family environment and become independent， they encounter a fiercely competitive society. Such a transition creates a huge psychological shock to the OCP generation and elevates their stress level， increasing their risk of developing mental problems. Based on the National Disability Survey and the China Family Panel Studies， empirical results reveal that the difference in mental disability between the cohort stepping into society and the younger cohort has enlarged after the introduction of the OCP. This pattern is more evident for the males and the only child. Furthermore， compared with females， males born after the OCP are more likely to feel depressed or mentally nervous than those born before the OCP. Moreover， the effect is much stronger for the only child. The findings demonstrate the mental health cost of the OCP and is conducive to a comprehensive reflections upon the impacts of OCP.
Key Words：One-child Policy; Mental Health; Social Pressure