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This study aims at finding out how China’s domestic and international timber markets interact with each other. Wald–Granger causality test, Geweke causality test and spectral Granger causality test were adopted to analyse daily data of domestic and imported logs and sawn timber prices. The results revealed that there was a significant Granger relationship between domestic and imported log markets and between domestic and imported sawn timber markets in both long and short terms, with a large proportion of instant feedback relationship. But the Granger tests for the relationship between the domestic log price and imported sawn timber price displayed a great difference. The Wald-Granger and Geweke causality test results showed that there was Granger relationship between the above two markets, but the result of spectral Granger causality test suggested that the domestic log price was not the Granger cause of the imported sawn timber price in the frequency domain of [0, π]. The results of empirical an...

China is the largest importer of waste paper in the world and is highly dependent on the international market. Thus, the relationship between Chinese and international waste paper markets affects the supply of fiber materials in China’s paper industry. This study examined the dynamic relationship between the two markets and the impact of newly implemented policies on both markets. We used unit root tests, cointegration test, vector error correction model (VECM) and frequency-domain Granger causality test to investigate the integration between Chinese and international waste paper markets and identify which of the two markets is the price leader. The results revealed that the two markets were integrated after controlling for structural breaks, and the Chinese market acted as the price leader. Since the supply of waste paper and wood pulp is insufficient in China to meet the fiber demand of the paper industry, waste paper import restrictions have significantly affected the supply of fiber materials in China’s paper industry. Therefore, the Chinese government should fully consider the benefit of market integration and make full use of international waste paper resources to satisfy the large domestic demand for paper products.

China's furniture industry has grown rapidly over the past 10 years, making China an important furniture exporter in the world. This paper focuses on the evolution path of R&D capacity and trade of China's furniture industry and their relationship, analyzes the impact of changes in external factors on R&D capacity, trade and profits, and makes predictions for R&D capacity, trade and profits. A dynamic model of R&D capacity, trade and profits for China's furniture industry is established in this paper based on the data from 1993 to 2008, five methods are used for model estimation and the result derived from the 3SLS method is selected according to the performance of the empirical estimation. The result of regressions shows that the R&D capacity of China's furniture industry acts negatively on its net exports and profit, which means the R&D capacity does not contribute much to net exports and profit increment, in spite of the noticeable increases in research expenditure. Also, the result indicates that the R&D efforts of China's furniture industry are more oriented towards enhancing the industry's learning capacity, but less towards encouraging innovation capacity. Research expenditure grows rapidly mainly because Chinese furniture manufacturers, taking advantages of their comparative advantages in cheaper labors, tend to gain market access by simply copying their competitors' products. The prediction of this model for 2009~2015 shows that China's furniture industry will continue to grow steadily if no substantial changes take place in the current conditions. The present development of China's furniture industry is somehow irrational and its competitive advantage will be easily lost when labor cost increases or when there is sharp fluctuation in the market. Therefore, the R&D efforts of China's furniture industry shall have to shift their emphasis from fostering learning capacity to fostering innovation capacity.