Paper by Professor Zhao Min Published in The Journal of World Economy

(Correspondent: Li Yue) Recently, Assistant Professor Zhao Min has had a paper published in the top economics journal—The Journal of World Economy. The paper is entitled “Currency Undervaluation, Global Division of Labour and International Value Transfer: Theory and a Chinese case Study”.

This paper constructs an international value transfer model comprising exchange rate factors and non-exchange rate factors based on the integration of international value transfer mechanisms, such as currency undervaluation, international technological differences and the transnational capital monopoly within the same theoretical framework. Theoretical research indicates that under the post-Fordist accumulation system, a country’s sovereign currency as a world currency draws developing countries into the capital accumulation logic of the world currency issuer to participate under this logic in the international division of labour. In the system of the global division of labour dominated by the capital of the world money-issuing countries, currency undervaluation and the exchange of commodities between developed and developing countries, based on the structured division of labour, have become the main mechanisms for external value transfer by undervalued countries. The calculation results based on China’s data from between 1995 and 2009 reveal that there is a vast amount of external value transfer by China in the world market, and that the undervaluation of the RMB is its main mechanism of action.

Founded in 1978, The Journal of World Economy is a national comprehensive economic theory journal. It is sponsored by China Society of World Economics and Institute of World Economics and Politics Chinese Academy of Social Sciences. It is recognized as a top journal of economics by universities and research institutions in China.