University of Hong Kong

China in the Global Economy (Spring 2021)

Problem Set 1
(60 points total)
Due Feb 21st, 2021 before 11 pm on Moodle

Please submit your own copy of the homework on Moodle. Feel free to work with your classmates.
However, answers that are identical to your classmates may be considered as plagiarism, which
is subject to the penalty discussed in the syllabus.

Please use the following convention in naming your file: ps1_name.docx

1. Since the establishment of People’s Republic of China in 1949, the Chinese government was
exploring the strategy for the economic development. Based on the discussion in lecture 2,
please explain:
a. (10 points) Why China choose the Soviet economy model? (max. 100 words)
b. (10 points) What is the most important feature of the Big Push strategy? Please
explain your reason (max. 100 words)
c. (10 points) Please discuss how do you think the Big Push strategy could contribute to
the economy of China? Please keep it as an open discussion in both positive and
negative impact (max. 100 words)
d. (10 points) If you are able to provide suggestions to the economic strategy to Chinese
government back to the years when China was founded, what policy you would like
to propose the most? (max. 100 words)

2. Choose a time period of 10 years, download the GDP and GDP growth rate data for China
from the link below and try to explain (lecture 3):
a. (10 points) Please plot the data and describe the basic trend of the GDP and the
changes of GDP growth rate during this time period. (max. 100 words)
b. (10 points) Please provide three factors that you think should be the most important
determinants to this economic growth during this time period. Just a suggestion for
you to kick off your analysis: you may try to think about the factors related to foreign
trade, investment, technology, human capital, or government policies. (max. 100
words)

Data source:
https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2018&locations=CN&s
tart=1961