Hongsong Zhang
Prof. Hongsong ZHANG
Associate Director, Institute of China Economy
Associate Professor

2859 2780

KK 906

Academic & Professional Qualification
  • Ph.D., Pennsylvania State University
  • M.A., Peking University
  • B.A., China Youth University for Political Sciences

Dr. Hongsong ZHANG is an Associate Professor of Economics at the University of Hong Kong (HKU), and the Associate Director for the Institute for China and Global Development at HKU. His main research interests cover topics in empirical industrial organization, international trade, and applied microeconomics, with a special focus on how firms’ competitiveness in productivity, supplier network, and demand affects firm performance in the domestic and international markets. His research has been published in leading general interest and top field journals in Economics, such as International Economic Review (x2), European Economic Review, and Journal of Development Economics. Starting 2020, he also serves as an Associate Editor for the International Journal of Industrial Organization (IJIO). He has won multiple external grants from the General Research Funds of the Hong Kong Research Grants Council. He also serves as an Executive Committee Member for China Trade Research Group since 2018.

Dr. Zhang obtained his Ph.D. in Economics from the Pennsylvania State University in 2013, M.A. in Economics from Peking University, and B.A. in Economics from the China Youth University for Political Sciences. He joined the HKU Business School at The University of Hong Kong as Assistant Professor in 2013.

Research Interest
  • Empirical Industrial Organization
  • International Trade
  • Productivity, Supplier Network and Firm Dynamics
Selected Publications
  • “Input Prices, Productivity, and Trade Dynamics: Long-Run Effects of Liberalization on Chinese Paint Manufacturers”,
    with Paul L. E. Grieco and Shengyu Li. The RAND Journal of Economics, Vol 53, Issue 3, Pages 516-560, Fall 2022.
  • “Does External Monitoring from the Government Improve the Performance of State-Owned Enterprises?”,
    with Shengyu Li. The Economic Journal, Vol 132, Issue 642, Pages 675-708, February 2022.
  • “What You Import Matters for Productivity Growth: Experience from Chinese Manufacturing Firms”,
    with Jiawei Mo, Larry D. Qiu, and Xiaoyu Dong.​ Journal of Development Economics, Vol 152, Article 102677, September 2021​.
  • “Non-Neutral Technology, Firm Heterogeneity, and Labor Demand”,​
    ​​​Journal of Development Economics, Vol 140, Pages 145-168, September 2019.
  • “Productivity or Unexpected Demand Shocks: What Determines Firms’ Investment and Exit Decisions?”,
    with Pradeep Kumar. International Economic Review, Vol 60, Issue 1, Pages 303-327, February 2019.
  • “Static and Dynamic Gains from Costly Importing of Intermediate Inputs: Evidence from Colombia”,
    European Economic Review, Vol 91, Pages 118-145, January 2017.
  • “Production Function Estimation with Unobserved Input Price Dispersion”,
    with Paul L. E. Grieco and Shengyu Li. International Economic Review, Vol 57, Issue 2, Pages 665-690, May 2016.
Working Papers
  • “Technology Training, Contract Trade, and Quality Upgrading in an Agricultural Supply Chain”,
    with Sangyoon Park and Zhaoneng Yuan, March 2022.
  • “Output Quality, Productivity Growth, and Resource Reallocation”,
    ​ with Jing Li and Shengyu Li, October 2021.
  • “Epidemics, Inventory, and Markup: Evidence from the 2003 SARS Shock in China”,
    with Yating Jiang, August 2021.
  • “How Do Hospitals Respond Differently to Competition? Quality, Prices, and Efficiency”, ​
    with Mona Luan and Zhigang Tao, August 2018.
  •  “What Goods Do Countries Produce and Trade? The Role of Technology-Endowment Matching”,
    with Xiaoping Chen, 2017.
Recent Publications


Does External Monitoring from Government Improve the Performance of State-Owned Enterprises?

Dr Hongsong Zhang of HKU Business School and Dr Shengyu Li of University of New South Wales discussed in this VoxChina piece their investigation of the impact of external monitoring from the government on state-owned enterprise performance, using the variation in monitoring strength arising from a nationwide policy change and firms’ geographic location in China. We utilize a structural approach to estimate input prices and productivity separately at the firm level using commonly available production data. We show that enhanced external monitoring, as a key component of corporate governance, can substantially reduce managerial expropriation in procurement and shirking in production management. The results suggest that government monitoring can be an effective policy instrument to improve state-owned enterprise performance.





Productivity or Unexpected Demand Shocks: What Determines Firms’ Investment And Exit Decisions?

We investigate the roles played by unexpected demand shocks, besides productivity, on firms' capital investment and exit decisions. We propose a practical approach to recover unexpected firm‐level demand shocks using inventory data. The recognition of demand shocks and inventory also improves the productivity estimation. The empirical results indicate that although productivity and demand shocks are both significant factors determining firm behavior, the former is more dominant for investment decision and the latter is more salient for firm exit. These findings confirm that unexpected demand shocks, besides persistent productivity, are important factors when analyzing capital investment and firm exit decisions.