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This paper tests the significance of FDI as a way to alleviate credit constraints. Incoming foreign investment provides additional sources of capital. Specifically in the Chinese case, enterprises may look for foreign investors, being constrained in their activity due to distortions in the state-dominated system. First, the Chinese financial system allocates resources to the least efficient firms – state-owned enterprises – while denying the same resources to Chinese private enterprises, forcing them to look for a foreign investor. Second, the inefficient system of state investment planning leads to mismanagement of public enterprises, increasing ‘insolvency-induced FDI’. We propose to analyse determinants of FDI in Chinese provinces to test the above hypotheses. We control for traditional determinants of FDI such as market access, labour costs, productivity, infrastructure, reform advances and banking sector size in order to assess the impact of inter-provincial heterogeneity in terms of the access that private enterprises have to credit and the distortive management in state-owned firms. [ABSTRACT FROM AUTHOR]

This paper uses China's public companies to test the influence of fiscal policy uncertainty on corporate total factor productivity. The study finds that fiscal policy uncertainty has a negative impact on the total factor productivity, and the effect of conservative tax avoidance, a mediating variable between the two, is found more significant for non‐state‐owned and non‐recession‐stage enterprises. The study further finds that facing fiscal policy uncertainty, companies reduce R&D investment, which will deteriorate productivity. The overall results show that if the government maintains relatively stable fiscal policies, it will positively improve corporate total factor productivity, even in a longer period. [ABSTRACT FROM AUTHOR]

The paper made an empirical analysis on how institutional distance affects the risk preference of enterprises' OFDI by using the sample of A‐share listed companies in China from 2014 to 2018 and further explored how institutional distance affected enterprises' preference for low‐risk investment in OFDI in "the belt and road" and other countries through fuzzy set qualitative comparative analysis. The paper shows that the institutional distance is negatively correlated with the risk preference of enterprises' OFDI. Six factors, such as voice and accountability, political stability, government effectiveness, regulatory quality, rule of law, and control of corruption, form diversified configuration forms and influence paths that affect the risk preference of Chinese enterprises' OFDI. The specific performance is that "high voice and accountability, low government efficiency and low corruption control" will drive enterprises' low‐risk investment preference in "the belt and road" countries; And "low government efficiency, low regulatory quality and high legal level" will drive enterprises' low‐risk investment preference in other countries. [ABSTRACT FROM AUTHOR]

This paper investigates the effects of zombie firms on Chinese manufacturing capacity utilization rate (CUR hereafter) from the perspectives of both the intra‐industry and supply chain propagation. The results show that zombie firms not only significantly reduce the CUR of healthy firms in the same industry, but also inhibit the increase of CUR through the supply chain propagation. Specifically, if the supply chain propagation effect is not considered, the inhibitory effect of intra‐industry zombie firms on the healthy firms' CUR would be overestimated on one hand, and the overall inhibitory effect of zombie firms on CUR would be underestimated on the other hand. The heterogeneity analysis demonstrates that the inhibitory effect of zombie firms on CUR is more pronounced for private firms, the firms in the industries with higher external financing dependence and the firms in the areas with a poorer institutional environment. In addition, this paper further studies the relationship among zombie firms, resource misallocation and the manufacturing aggregate CUR at the industry level, and finds that both intra‐industry and upstream (downstream) zombie firms have significant inhibitory effects on the growth of manufacturing aggregate CUR. However, there are differences in the ways of influence that, specifically, the upstream (downstream) zombie firms inhibit manufacturing aggregate CUR growth mainly through the within‐firm effect, while the intra‐industry zombie firms are more likely to restrain manufacturing aggregate CUR growth through resource misallocation. Our study contributes to a profound understanding of the causes of overcapacity in a large transition economy and also expands the research perspective of assessing the economic effects of zombie firms. [ABSTRACT FROM AUTHOR]

This paper focuses on the earnings management and the culture of China Time‐honoured Brand. It shows that the accrual earnings management and real earnings management of China Time‐honoured Brand are significantly lower than other enterprises. The transmission mechanism between culture and corporate earnings management comes from the executives' culture infiltration. Property rights and incentive compatibility have significant moderating effect on the relationship between China Time‐honoured Brand and earnings management. From the quantitative point of view, this paper supplements the function of China Time‐honoured Brand culture in overcoming the problem of corporate information distortion and points out also the transmission mechanism and adjustment factors. On the one hand, it helps to deepen the understanding of the cultural factor and corporate financial behaviour, and on the other hand, it provides the direct evidence about the influence of Chinese excellent traditional culture to the small companies. The article helps to understand the relationship between traditional culture, corporate culture and corporate financial behaviour and its mechanism of action, which has an important practical significance. [ABSTRACT FROM AUTHOR]

This paper explores the impact of special economic zones (SEZs) policy and export status on firms' productivity. We first sketch a theoretical model to explain the selection mechanism of different types of exporters and SEZ firms, and provide the productivity ranking of firms. SEZ's exporters have the highest productivity. Firms facing high imported intermediate tariffs will select themselves into SEZs to avoid imported input tariffs; firms become non‐SEZ's exporters when their intermediate inputs tariffs are low. Compared with other types of firms, non‐SEZ's non‐exporters have the lowest productivity. Then, we empirically test the productivity ranking by firm‐level data, and the results are consistent with our theoretical framework. Besides, different SEZ policies are associated with heterogeneous impacts on the firms' productivity. Our paper further suggests that preferential policies are responsible for the productivity ranking of firms. [ABSTRACT FROM AUTHOR]

From the micro‐perspective of enterprises, this paper makes an empirical analysis on how the national risk of overseas investment affects the strategic innovation behavior of enterprises by using the samples of A‐share listed companies in China from 2010 to 2019 and emphatically tests the mechanism of the national risk of overseas investment on the strategic innovation behavior of enterprises through government subsidy and media attention. It is found that, on the whole, the national risk of overseas investment will promote the strategic innovation behavior of enterprises. In terms of mechanism, the national risk of overseas investment promotes the strategic innovation behavior of enterprises by increasing the access to government subsidy, while the mediating effect of the media attention to the national risk of overseas investment on the strategic innovation behavior of enterprises is the masking effect; that is, the national risk of overseas investment inhibits strategic innovation behavior of enterprises by increasing media attention, and this indirect inhibition weakens the direct promotion of the national risk of overseas investment to strategic innovation behavior of enterprises. [ABSTRACT FROM AUTHOR]

The objective of this study is to examine the impact of government environmental concerns on green innovation and whether this has a "leverage effect" or a "crowding‐out effect." This study employs a two‐way fixed‐effects model to conduct an empirical test using panel data from 2010 to 2020 on Chinese firms listed in heavy‐polluting industries. The results suggest that an increase in government environmental concerns can promote corporate green innovation. However, government environmental concerns primarily stimulate strategic innovation rather than substantive innovation. After a series of robustness and endogeneity tests, the conclusions of this paper still hold. Corporate green innovation induced by government environmental concerns is not the "leverage effect" superimposed on existing innovation activities but the "crowding‐out effect" of other technological innovation. The heterogeneity tests in this paper indicate that the impact is more pronounced for firms with poorer environmental conditions, stronger political connections, and richer executive backgrounds. [ABSTRACT FROM AUTHOR]

This paper analyzes the share of state‐owned enterprises on the Fortune Global 500 lists from 2005 to 2020. The purpose is to answer two research questions—what is the share of SOEs among the world's largest companies, and is this share increasing over the years? Regarding studies of large sets of companies, the novelty of this article is the method in which SOEs were identified—based on the criterion of actual corporate control of the state and not the threshold of state ownership. The results show that the share of SOEs in the group of the world's largest companies is higher than indicated in previous similar studies, and this value has increased significantly over the last 15 years. In 2005, there were 64 SOEs on the list; in 2020, there were 141 (with the highest number—142—in 2015). In this period, the share of SOEs in revenues doubled (to almost 30%), in assets more than tripled and the total number of employees from SOEs from the list more than doubled. However, these increases were almost solely due to the growth of the Chinese economy, which resulted in more Chinese SOEs being included on the list. [ABSTRACT FROM AUTHOR]

The modern stage of economic growth is accompanied by sophisticated, multifaceted, and diverse processes, including globalization, the evolution of a new technological paradigm, the growing scarcity of available resources, and changing consumer demands and preferences. In this context, the ability of businesses to quickly and adequately adapt to changes, induced by the external environment, is crucial to their long‐term success. Awareness of these circumstances has led to increased research interest to the issues of managing the adaptability of businesses. The paper quantifies the major dependencies and controversies between the adaptability assessment methods and strategic development of entrepreneurship. The research findings provide an understanding of the overall trend of adaptability management and its impact on the business performance and management strategies that can be used to increase resistance to the extrinsic factors. The main methods of analysis include matrix‐based approaches to selecting the best strategic decisions. A methodical approach was proposed for a reasoned choice of retailers' strategic adaptation areas, which makes it possible to determine the optimal type of adaptation strategy and opens opportunities for determining the company's strategic pathway in its adaptation context. This paper addresses the current market‐driven settings of economic management and the issues of managing the retailers' adaptability in China, as well as the need to change the methods of their strategic management in order to develop a strong competitive position in today's fast‐paced environment and promote economic growth. The research findings can be applied in various types of businesses, regardless of the scale thereof. [ABSTRACT FROM AUTHOR]

This paper studies the impact of export VAT rebates on firm productivity with Chinese firm‐product‐level data. We find that higher VAT rebates significantly raise firm productivity. The results are robust to various estimations of firm productivity. Moreover, this paper finds that the impact of export VAT rebates on firm productivity is significantly different across firms and sectors. More specifically, our results suggest that the impact is mainly driven by firms with small export intensive margins and large export extensive margins, new exporters, financially constrained firms and low‐productivity firms. Furthermore, in high‐tech sectors, the impact is significantly large with a one percentage point increase of firm rate of VAT rebates nearly raising firm productivity by 6%. [ABSTRACT FROM AUTHOR]

Under the conduction of decentralized environmental governance, environmental punishment has become a pivotal complementary tool for local government environment management and an intuitive reflection of governance efficiency. However, the literature concerning the effect of local government environmental punishment towards the green technology innovation of enterprises is void. To bridge this gap, this paper adopts the fixed‐effect model to investigate the impact of government environmental punishment on green technology innovation based on the data of China's A‐share listed enterprises from 2010 to 2020. The study finds that the punishment can significantly promote enterprises' green technology innovation. The distinction between the type of innovation reveals that environmental punishment promotes substantive green technology innovation of enterprises, while the effect on strategic green technology innovation is not significant. As far as the influence path is concerned, external pressure and internal incentive are both important mechanisms for environmental punishment to facilitate the green technology innovation of enterprises. Heterogeneity analysis demonstrates that the positive effect of punishment on green technology innovation is more prominent in non‐state‐owned enterprises, heavily polluting industries and regions with strong public awareness of environmental protection. Further discussion reveals that the facilitative effect of punishment on green technology innovation also significantly improves the environmental performance of enterprises. This paper not only confirms the positive role of government intervention in environmental protection, but also provides practical reference for how to improve enterprises' competitiveness. [ABSTRACT FROM AUTHOR]

The effects of government bailouts have been extensively examined in the literature. This paper is one of the first to empirically examine the bailout funds established in China in 2018, which aimed to mitigate firms' liquidity squeeze risk caused by share pledges. Utilising a hand‐collected dataset of government bailout funds, this paper finds that stock prices increased when government introduced the bailout fund plan, especially for non‐state‐owned enterprises (SOEs) and firms with small size and share pledges. Long‐term performance of bailed out firms increased as well. Overall, our results provide new evidence that government bailouts have positive effects on financial markets. [ABSTRACT FROM AUTHOR]

This paper empirically investigates whether zombie firms affect healthy firms' exporting. Using the 1998–2007 Chinese firm‐level dataset, we provide strong evidence that zombie firms significantly decrease exports of healthy firms in each city‐industry cluster, that is, both whether to export and export values are affected by zombie firms. Specifically, non‐stated‐owned enterprises (non‐SOEs) are more vulnerable to the effect than their SOE counterparts. In addition, we also identify government subsidies, financial resources and total factor productivity as the sources of the effect, and the heterogeneous export performances of different types of firms are due to the variation in these sources. [ABSTRACT FROM AUTHOR]

This paper studies the relationship between firms' excess capacity and their environmental behaviour by matching the environmental data of China's major iron and steel firms with the Chinese Industrial Enterprises database. The findings are as follows. (1) A firm's excess capacity leads to myopic decisions, and firms will pay more attention to short‐run economic benefits at the cost of long‐run environmental benefits, which strengthens their dependence on the polluting path. (2) The dependence is positively correlated with the transformation barriers, and either a higher innovation cost or a higher possibility of regulatory capture in local official governance would lead to greater dependence on the pollution path. (3) Mergers & acquisitions (M&As) may hopefully cut such dependency, but only cross‐provincial M&As led by central state‐owned enterprises (SOEs) can effectively alleviate the "pollution effect" of excess capacity, while intra‐provincial M&As led by local SOEs fail to achieve such a goal. [ABSTRACT FROM AUTHOR]

This paper provides novel evidence of the moral hazard problem in environmental insurance by investigating the effect of environmental liability insurance (ELI) on firms' environmental performance. Using the staggered adoption of ELI policies in China as a quasi‐natural experiment, we employ a difference‐in‐differences setup based on a comprehensive firm‐level data set. We find that the adoption of ELI policies significantly reduces firms' efforts in treating water pollution. The negative estimate indicates a moral hazard problem and is the opposite of the positive estimates found mainly in studies that focus on US firms. We further find that the negative effect is lessened for firms in strictly supervised regions and for firms with strong environmental awareness. This paper is one of the first to evaluate environmental insurance in developing economies and provides novel evidence on moral hazard in environmental liability insurance markets. [ABSTRACT FROM AUTHOR]

The purpose of the paper is to investigate how innovative, small‐to‐medium enterprises (SMEs) internationalize through utilizing wholly foreign‐owned entities (WFOEs), as there is a little research explaining this. This paper presents the findings from in‐depth case studies with 14 SMEs that internationalized to China as WFOEs. The SMEs internationalized as WFOEs in order to tap into opportunities and develop presence. WFOEs were developed either proactively or reactively, which provided a catalyst for internationalization. SMEs mostly used radical, game‐changing product innovations. However, findings from the case studies revealed that the Chinese market did not always accept western innovations, and adaptations had to be made. A new conceptual model with a range of theoretical propositions for future researchers is developed, based on the findings. [ABSTRACT FROM AUTHOR]

In 2012, China was ranked fourth in patent filing by region of origin. However, firm innovation quality is not comparable to such quantity. Evidence of this is that no Chinese organization was named as a Thomson Reuters 2011 or 2012 Top 100 Global Innovators. This paradox of firm patenting and innovations in China challenges the traditional understanding of the role of government in industrial innovation. This paper provides a theoretical lens through which to examine traditional protective and strategic patenting motives. Based on institutional theory and the ultimate goals of patenting motives, the paper posits that protective patenting motives are directly law-based while strategic patenting motives are largely law-derived. The paper also aims to empirically examine three questions: (1) What is the relative importance of various patenting motives to firm patenting behaviors? (2) What effects do patenting behaviors have on firm product and process innovations? (3) How, if at all, does governmental institutional support affect firm patenting and innovations? This paper uses dominant analysis, structural equation modeling, and regression analysis to analyze the survey data collected from a sample of 270 firms in China. The empirical results provide new evidence about firm patenting, innovations, and government institutional support. First, the order of relative importance of patenting motives to patenting behaviors was found to be (in the descending order of importance) reputation, exchange, blocking, and protection. Second, patenting behaviors were more relevant to product innovations than to process innovations. Third, more importantly, while government institutional support can enhance the effects of protective patenting motives on patenting behaviors, it can mitigate the effects of strategic patenting motives on patenting behaviors. Moreover, government institutional support reduces the positive effect of patenting behaviors on product innovations. These findings suggest that firm patenting and innovations are distinct activities, and that government institutional support acts as a double-edged sword in firm patenting and innovations: On the one hand government institutional support-an extralegal formal institution-may work alongside the patent system-a law-based formal institution-to advance science and technology, but on the other hand government institutional support may distract firms from commercializing patented knowledge into new products. This paper primarily contributes to institutional theory, new product development literature, and innovation management practice by revealing the dynamics between two different types of formal institutions-patent system and government institutional support-by establishing an institution-based view of patenting motives, by empirically distinguishing firm patenting and innovations, and more interestingly by uncovering a double-edged role of government institutional support in firm patenting and innovations. [ABSTRACT FROM AUTHOR]

Firms in transition economies often suffer financial constraints. In initial public offerings (IPOs), however, many newly listed Chinese firms raise funds in excess of what is originally planned. This paper examines whether these excess IPO funds are wasted on value‐destroying spending or enable firms to take growth opportunities. After controlling for the endogeneity issue, we find that Chinese firms with excess IPO funds have better post‐IPO operating performance, especially those with limited financing channels. In revealing the mechanism, we find that excess IPO fundraising alleviates financial constraints and reduces the cost of debt. [ABSTRACT FROM AUTHOR]

There is a wide debate on the optimal shareholding proportion of controlling shareholders. Under the background of China's mixed‐ownership reform, this paper focuses on a specific firm setting of mixed‐ownership enterprises in fully competitive industries, and tries to find the heterogeneity in the association between controllers' shareholding and firm performance. Specifically, with a sample of China's A‐share listed companies from 2007 to 2018, we find significant differences in this relationship due to different types of controlling shareholders. The effect of controller shareholding on firm performance is not significant in foreign‐controlled enterprises, while that of private enterprises presents a monotone increasing linear relation with statistical significance. No optimal controlling shareholding interval is found in either foreign‐controlled or private‐controlled enterprise. In state‐controlled enterprises, we find an overall inverted U‐shaped with local stage linear relationship between state‐controlling enterprises' controller shareholding and firm performance. The optimal interval of state‐controlling shareholding is 42%–68%. [ABSTRACT FROM AUTHOR]

Based on hand‐collected data on Chinese listed non‐state‐owned enterprises (hereafter, non‐SOEs), this paper investigates how political connection and family involvement affect firms' IPO underpricing. We find that political connection and family involvement, serving as common compensatory mechanisms for institutional deficiencies, can significantly alleviate the IPO underpricing of non‐SOEs. Moreover, evidence shows that in regions with a well‐developed institutional environment, political connection significantly reduces the degree of IPO underpricing. But for companies located in regions with a poorer institutional environment, family involvement helps to achieve lower underpricing. The effects also vary with firm size. Political connection significantly mitigates underpricing of large firms. But for small firms, only family involvement plays a significant role in lowering IPO underpricing. Finally, we find that instead of increasing the offering price, the effect works in another way. Non‐SOEs with political connection and family involvement are no longer growth firms, for which the influence of the regulatory bar set by the China Security Regulatory Committee (CSRC) decreases. These firms tend to experience poorer long‐term performance after the IPO. This may lead to a relatively lower price in the secondary market, resulting in a lower level of IPO underpricing. [ABSTRACT FROM AUTHOR]

This paper investigates the performance of Chinese acquirers in cross‐border mergers and acquisitions (M&As) between 2010 and 2018. Compared to domestic acquirers, the paper finds no significant improvement in labour productivity nor total factor productivity (TFP) within two years after acquisitions. However, firms engaged in foreign acquisitions witness an increase in total sales, employ more labour and accumulate more capital up to two years after transactions. The effects are more pronounced in deals in developed destinations relative to less‐developed countries. Heterogeneous effects are explored across various industries, as well as deal structures. The results imply that outward cross‐border M&As in China are not driven by productivity improvement but rather scale effects. [ABSTRACT FROM AUTHOR]

Enterprises have different behavioral characteristics depending on their ownership structure and their nature and play different roles in promoting economic development. In order to explore the innovation behavior characteristics of private enterprises, state‐owned enterprises, Hong Kong‐, Macao‐, and Taiwan‐funded enterprises, and foreign‐funded enterprises in China's high‐tech industry, this paper constructs spatial lag models and varying coefficient spatial lag models within the framework of knowledge production functions. It not only evaluates the technological innovation performance of various types of enterprises in high‐tech industries but also comprehensively explores the differences in the impact of external environments such as spatial dependence and business environment on the innovation efficiency of various types of enterprises. The results of the study provide a reference for enterprise managers and investors to efficiently allocate the scarce resources for innovation investment. [ABSTRACT FROM AUTHOR]

China enacted the Anti‐Monopoly Law in 2008. This law is deemed a milestone of competition policy to improve market efficiency in the country. This paper builds a theoretical model and applies a difference‐in‐differences method using a firm‐level dataset of the 1998–2015 period to examine the impact of this law on firm productivity. We show that the enactment of this law significantly increased the total factor productivity (TFP) of the firms. The results are shown to be robust across alternative definitions of the treatment variable and alternative measures of productivity. Finally, we show that the productivity effect of this law tends to be stronger among state‐owned enterprises than private/foreign firms and large firms than small firms. [ABSTRACT FROM AUTHOR]

Based on social capital theory, this paper aims to investigate the impact of member enterprises of alien merchant chambers on enterprise innovation, within A‐share listed companies on the Shanghai and Shenzhen Stock Exchanges of China from 2010 to 2020. Additionally, the study seeks to explore the role played by social capital resulting from participation in these alien merchant chambers. Furthermore, we delve into the moderating effects of the number of alien merchant chambers and the degree of marketization in the enterprise's location. Moreover, we analyze the influence of heterogeneity in firm ownership and firm type. Our findings reveal that member enterprises of alien merchant chambers can increase their social capital and consequently promoting innovation; both the quantity of alien merchant chambers and the level of marketization in an enterprise's location positively influence this enhancement. Furthermore, the impact of state‐owned enterprises and non‐high‐tech enterprises on enterprise innovation, following their engagement with alien merchant chambers, surpasses that of non‐state‐owned enterprises and high‐tech enterprises. This research bridges the gap in understanding the corporate governance implications of alien merchant chambers, provides empirical evidence concerning Chinese alien merchant chambers, and addresses inquiries regarding the influence of merchant chambers' social capital. Additionally, it proposes a novel approach for listed companies to overcome resource constraints and to collaboratively pursue development, especially in light of the challenges posed by the COVID‐19 pandemic. [ABSTRACT FROM AUTHOR]

By adapting a well‐known model in the literature, the current paper sharpens the theoretical predictions on how competition intensity and institutional ownership interact to influence corporate innovation decisions, and adopts data from Chinese listed firms to empirically test the validity of two potential mechanisms. The split‐share reform of 2004–2005, whose timing and speed were largely beyond the firms' control, is used as a quasi‐natural experiment to address the potential endogeneity of institutional share. Similar to the existing results, we find support for the career concern mechanism rather than the lazy manager mechanism. But in addition to the complementary effects between institutional share and competition intensity on corporate innovation documented in their work, our findings also imply that competition discourages innovation when the share of institutional investors is low but encourages innovation when the institutional share is high. The opposite effects of competition on innovation with or without institutional shares is accounted for by the negative correlation between competition and innovation success, which is an assumption in our theoretical model that departs from the existing literature, but fits the reality of China's economic transition. Additional evidence relating listed firms' managerial turnover to their institutional shares is also in support of the career concern mechanism. Combined with the substantial increase in innovation after the split‐share reform, these findings demonstrate the strong positive role of institutional investors in encouraging innovation, but also offer more insight into the complex process that determines corporate innovation, especially where ownership structure is still in flux. [ABSTRACT FROM AUTHOR]

This paper explores the impact of auditing firms on the implementation of the new Chinese Accounting Standards for Enterprises 22 (new CAS 22), which converges with IFRS 9. We find that the Big4 firms focus on fair value measurement and application of the expected credit loss (ECL) impairment model, whereas the LocalTop6 firms primarily focus on the classification of financial assets. The results indicate that effective implementation of the new standards mainly depends on standardized procedures and professional techniques of auditing firms, as the Big4 firms exhibit better implementation of the new standards in terms of items that generate greater risk and uncertainty than do local large auditing firms in China. In addition, we further test how cross‐listing affects the role of auditing firms in implementing the new standards and find that the Big4 firms play a more significant role for A‐share only companies than A + H companies. The findings reveal the challenges associated with implementation of IFRS 9‐based new CAS 22 in China. [ABSTRACT FROM AUTHOR]

The paper empirically studies the relationship between internal institutions, knowledge sharing, and technological innovation based on the data of investigating 163 China's characteristic culture enterprises by applying structural equation model. The study shows that the internal institution of characteristic cultural enterprises can significantly enhance the knowledge sharing of employees in characteristic cultural enterprises; the knowledge sharing of employees will significantly enhance the technical innovation level of characteristic cultural enterprises; the internal institution of characteristic cultural enterprises does not directly and significantly improve the technical innovation level, but indirectly through enhancing the knowledge sharing of enterprise employees. [ABSTRACT FROM AUTHOR]

In transitional economies characterized by digital finance and uncertainty, the environmental, social, and governance (ESG) impact on enterprise performance has become a core issue in the sustainable development of enterprises. The existing literature does not pay attention to the simultaneous existence of digital finance and economic policy uncertainty in transition countries such as China. This paper introduces ESG as intangible capital into the Cobb–Douglas production function, considers the impact of digital finance and economic policy uncertainty, establishes a theoretical analysis framework, and empirically tests the impact of ESG on enterprise performance using panel data of 1688 listed companies in China from 2011 to 2020. The results reveal that ESG promotes enterprise performance; digital finance strengthens the positive impact of ESG on enterprise performance, and increased economic policy uncertainty strengthens the positive moderating effect of digital finance. Heterogeneity analysis reveals that the impact of ESG on enterprise performance and the moderating effect of digital finance are significant in both the eastern region and the central and western regions, but the former performs better when economic policy uncertainty increases. The research conclusion provides a policy reference for selecting appropriate digital finance policies to promote the sustainable development of enterprises with ESG as the core. [ABSTRACT FROM AUTHOR]

Continuous improvement of technological innovation ability, adjustment of the development strategy, and enhancement of operational performance are of great theoretical and practical significance for logistics enterprises. This paper aims to analyze and evaluate the innovation efficiency of the logistics industry. The study utilizes the static three‐stage DEA model and the dynamic Malmquist index model, considering a total of 12 indicators related to innovation input, output, and environmental variables. A dataset of 2940 entries from 49 listed logistics enterprises from 2017 to 2021 was calculated. The analysis provides insights into the innovation efficiency of logistics enterprises from a static perspective and the innovation total factor productivity from a dynamic perspective and decomposition terms. Based on the analysis of environmental variables by the SFA model, it was found that DEA inefficiency is the combined result of environmental factors and management inefficiency. Environmental variables have both positive and negative effects on innovation. The improvement of the economic development level will lead to excess R&D investment. Increased government simple fund subsidies are not conducive to the efficient allocation of innovation resources within enterprises. The expansion of enterprise scale will increase R&D personnel and investment in fixed assets. A thriving technology market can encourage enterprises to improve their own conversion rate of scientific and technological output and give full play to their innovation ability. The dynamic Malmquist model analysis reveals a recution in the overall innovation efficiency of listed logistics enterprises over 5 years. The changes in total factor productivity and technological progress efficiency of all listed logistics enterprises are synchronized, with most enterprises exhibiting higher technological progress efficiency compared to comprehensive technical efficiency. The total factor productivity of logistics enterprise innovation is mainly affected by comprehensive technical efficiency. [ABSTRACT FROM AUTHOR]

This paper investigates the impact of volatility in profitability shock, capital price distortion and adjustment costs on capital misallocation among Chinese industrial firms. We estimate a dynamic model pertaining firms' investment decision, incorporating institutional differences between state and private firms, so the model can reproduce salient features observed from Chinese firms. Our analysis shows: (i) capital price distortion is more severe among state firms than private ones; (ii) adjusting capital is more costly for state than private firms; (iii) volatility in profitability shock is a major source that causes capital misallocation for both types of firms. [ABSTRACT FROM AUTHOR]

The impact of the incumbent state‐owned enterprises (SOEs) on the births of new private‐owned enterprises (POEs) in China is a central concern for the government and society. In this paper, we apply agglomeration theories to distinguish the linkages between SOEs and POEs. Using China's 2008 economic census, the 2007 Input‐Output Table, and the 2005 population census, we measure the formation of new POEs at the city‐industry level, and the agglomeration forces of distance proximity to inputs, outputs, labor, and technology. More explicitly, we measure the extent to which local SOEs provide relevant inputs, consume outputs, employ similar workers, and use similar technology. Our findings indicate that overall, incumbent SOEs hinder the formation of new POEs. For manufacturing, the entry of new POEs is significantly lower in places where more upstream SOEs are concentrated. For services, the entry of new POEs is significantly lower in places where more upstream and downstream SOEs are concentrated. However, the agglomeration effects from the incumbent POEs are either insignificant or significantly positive. [ABSTRACT FROM AUTHOR]

Using the exogenous event of oil price sharp decline in 2014–2015, this paper employs the difference‐in‐difference method to establish a causal link between the oil price decline and the Chinese firms' labour investment. Data of listed companies in China from 2012 to 2016 are used to explore this relationship. We show that the employment for firms in industries with significant negative oil price risk exposure increases 16.4% after the oil price plummeted, that is, the oil price decline significantly promotes the firms' labour force. Additionally, the positive effect of oil price decline on the firms' labour force is more pronounced in firms with higher risk‐taking, financing constraints, and industry competition. Lastly, we also document that the effect of oil price decline is through sales growth channels to increase labour demand. However, firms tend to overinvest in labour after the oil price plummeted. Based on these findings we suggest that oil price fluctuation should be an important factor for the Chinese government and enterprises when they make an economic decision related to the labour force. [ABSTRACT FROM AUTHOR]

This paper examines the impact of an increase in the minimum wage standard on enterprise innovation and its mechanism. Based on the matching data between China's A‐share listed enterprises and the city minimum wage standard from 2003 to 2018, we find that an increase in the minimum wage standard promotes enterprise innovation, and this impact is sustainable. Mechanism analysis shows that an increase in the minimum wage standard enlarges R&D investments and personnel to promote enterprise innovation. In addition, we find that an increase in the minimum wage standard has a stronger effect in promoting the innovation of large, labour‐intensive, high‐innovation or non‐state‐owned enterprises than the others. [ABSTRACT FROM AUTHOR]

This paper studies the impact on firm value of tighter checks on bureaucrats' behaviour. We use as a natural experiment the revision in 2015 by the Communist Party of China (CPC) of its regulations on disciplinary actions. We document a positive and substantial market reaction following this unexpected policy change that tightened and formalised constraints on bureaucrats' misconduct. The impact is less pronounced for firms with state ownership, firms having CEOs or directors with CPC membership, and firms that operate in provinces with better institutional quality. The subsequent revision in 2018 that enforced political obedience is not associated with a positive market reaction. [ABSTRACT FROM AUTHOR]

This paper investigates the effects of corruption on centralisation in state‐owned enterprises (SOEs). Based on a unique setting in China where both parent firms' and the whole business group's financial statements are mandatorily disclosed, we construct a novel proxy of centralisation exploiting the allocation decision rights within business groups. We then introduce a quasi‐natural experiment (i.e., China's anti‐corruption campaign) to present that the reduction of corruption significantly enhances the centralisation of SOEs. A plausible mechanism is that the anti‐corruption campaign reshapes firms' internal governance and operation. Our findings are particularly pronounced for SOEs with low levels of financing conditions and ownership concentration. [ABSTRACT FROM AUTHOR]

Over the past decades, the automotive sector in China has been characterized by the obligation of foreign manufacturers to enter joint ventures, transfer technologies, and localize production. Still, the Chinese automotive industry has remained dependent on foreign brands, capital, and technology. The advent of markets and supply chains for electric vehicles, however, changes the framework conditions for established foreign automotive firms in terms of competitive landscape and access to core technology components. This is mainly the result of political initiatives: Established automotive manufacturers are exposed to direct and indirect restrictions that influence their production of electric vehicles, their choice of suppliers, and their potential market shares in the future. This paper outlines multilevel bargaining processes of Chinese and foreign actors as they aim to maximize value capture in a fundamentally transitioning automotive sector. In contrast to the lead firm‐centric focus of recent global production networks (GPN)‐discussions, this paper argues that the determinants of how production networks evolve is first and foremost a question of the institutional environment. Focusing on power balances between state and firm actors in multilevel bargaining processes offers a way of explaining GPN‐evolution in institutional contexts in which power concentrates in executive bodies and decision‐making processes are often informal. [ABSTRACT FROM AUTHOR]

This paper investigates the behavioral additionality effects of a unique high‐ and new‐ technology enterprise (HNTE) program in China. The program provides a reduced corporate income tax to certificated HNTEs. By distinguishing research expenses from development costs, we examine if the tax incentive program affects firms' composition of R&D investment, based on a sample of Chinese listed firms. The results indicate that the tax incentive program encourages firms to focus more on development than on research. The effects are also found to be heterogeneous among the first‐time, repeated, and one‐time certification users. The results imply that tax incentives prompt firms to invest in short‐term development opportunities with promising private returns. Conversely, they are less likely to stimulate risky research projects with potential high rates of social and long‐term economic returns. Our study highlights the importance of understanding the behavioral additionality effects for innovation policy evaluations and better policy designs. [ABSTRACT FROM AUTHOR]

This paper investigates conditional configurations for improving high‐tech enterprises' new product development (NPD) performance under complex environment of digital era in China. The results indicate that digital transformation is neither sufficient nor necessary for high NPD performance but a significant component of those configurations for high NPD performance. Through the fuzzy‐set qualitative comparative analysis (fsQCA) approach, four configurations for high NPD performance and four configurations for non‐high NPD performance are generated from complex nonlinear interactions among five antecedent conditions of NPD performance. Our findings enrich the literature on NPD performance and provide references on enterprises' decision making on digital transformation. [ABSTRACT FROM AUTHOR]

Due to special historical factors and government preferences, many zombie enterprises with subsidies and credit as the main source of income can be maintained in China. Zombie enterprises damage the fair position of market players and cause irreparable damage to the market mechanism, with efficiency as the core. This study chooses factor productivity as the starting point and uses the financial data of listed manufacturing companies from 2008 to 2016 as the sample to explore and evaluate the damage of zombie enterprises to the production efficiency of the Chinese market. The main contributions of this study are as follows. First, zombie enterprises in listed companies are identified by a comprehensive identification method. Second, the growth rate of the total factor productivity of non‐zombie enterprises is measured by the DEA Malmquist index method, the crowding‐out effect of zombie enterprises on TFP growth of normal enterprises is studied, and the specific transmission path is analysed. The empirical results show that zombie enterprises have a significant inhibitory effect on the total factor productivity growth of non‐zombie enterprises, verifying our conjecture at the macro level. Finally, on the basis of theoretical and empirical analyses, this paper puts forward some policy suggestions to help zombie enterprises clear up to promote the growth of total factor productivity of non‐zombie enterprises and the healthy development of the entire industry. [ABSTRACT FROM AUTHOR]

This paper empirically explores the impact of oil price uncertainty on the strategic investment of China's renewable energy enterprises from the perspective of certain substitution relationships between renewable energy enterprises and traditional energy enterprises by using the systematic GMM method. In addition, we propose three specific influence mechanisms for the renewable energy industry. The results of our mechanism analysis show that the uncertainty of oil price will increase the market's expectation of renewable energy enterprises and thus stimulate their investment. While the uncertainty of oil price will restrain the investment expenditure of renewable energy enterprises through risk transmission. The scale of enterprises will affect the above two influencing mechanisms. However, the uncertainty of oil price can hardly influence the strategic investment decision through the stimulation of the renewable energy industry by the consumer market. Our results are helpful to the strategy makers of renewable energy enterprises and the macro policy‐makers of the government. [ABSTRACT FROM AUTHOR]

Using the 2019 China Invested Firms and Employees Survey (CIFES), this study explores the convergence of Chinese enterprise and employee (E&E) evaluation in Southeast Asian countries. The results show that convergence varies greatly across the nine Southeast Asian countries. Union organisations and economic factors play a key role in convergence. Firms with labour unions report a more effective corporate social responsibility (CSR) performance than others, while employees in the construction sector report their firms' CSR and those in the manufacturing and service sectors. Interestingly, the number of years worked by an employee correlates positively with their perception of firms' CSR performance. This paper uses China Invested Firms and Employees Survey data to compare employer‐reported and employee‐perceived corporate social responsibility performance of Chinese firms in nine Southeast Asian countries in terms of employees' union participation, working experience as well as industrial sector of the firms. [ABSTRACT FROM AUTHOR]

We study how geographic proximity to financial centers affects price efficiency. Using high‐speed railway connections between firm cities and their nearest financial centers in China as exogenous shocks, we find stocks of connected firms are more efficiently priced than those of firms that are not connected. Consistent with our hypothesis, ease of travel has a stronger effect on firms that are closer to financial centers, smaller, have less institutional ownership and financial analyst coverage, and are not on the short sales list. Our paper highlights the importance of the geographic proximity of firms to financial centers on financial market efficiency. [ABSTRACT FROM AUTHOR]

When the Melitz model is implemented in practice, the industrial productivity distribution is often assumed to be of Pareto form. In this case, a fundamental relationship κ > σ − 1 must hold to guarantee the convergence of the industrial average productivity, where κ is the concentration degree of the industrial productivity Pareto distribution and σ is the substitution elasticity across varieties in the industry. This paper estimates the concentration degrees of the Pareto distribution in industrial productivity and industrial substitution elasticities using firm-level data of 40 Chinese manufacturing industries between 1998 and 2007. However, the paper shows that the above fundamental assumption κ > σ − 1 does not hold for nearly all the industries for Chinese firm-level data. An explanation is proposed as a result of the distorted firm size and productivity for Chinese characteristics. [ABSTRACT FROM AUTHOR]

Drawing on the complementary asset theory, this paper develops a conceptual model to explain the relationships among intrafirm knowledge sharing, knowledge application, and innovation as well as the moderating effect of entrepreneurial orientation (EO) on the intrafirm knowledge sharing and knowledge application. Using a sample of 607 Chinese firms, this paper empirically examines this model. The results show that, under China's transition economy, the positive relationship between intrafirm knowledge sharing and a firm's innovation is mediated by knowledge application. Furthermore, intrafirm knowledge sharing facilitates knowledge application, and EO positively moderates this relationship. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

An increasing number of emerging countries have begun implementing central environmental protection inspection (CEPI) to make up for the lack of environmental decentralization. Extant literature has shown that CEPI improves local environmental enforcement and performance. However, it is unclear whether CEPI, which is regarded as a non‐routine environmental enforcement and independent of the system of environmental decentralization, has an increasing effect on firms' environmental disclosure. This paper selects the listed firms located in Hebei Province, the pilot province inspected by the CEPI, as the treatment group and uses the listed firms of the third and fourth rounds of inspected provinces as the control group. The difference‐in‐difference results show that the environmental information level and quality of listed firms in Hebei Province is improved compared with those of firms in other provinces, and the increasing effect is more significant in state‐owned firms, in developed regions and in regions where local officials have more promotion incentives. The results of this study suggest that the central government should establish a regular environmental inspection mechanism and coordinate it with the system of environmental decentralization in emerging countries. [ABSTRACT FROM AUTHOR]

Some theoretical work suggests credit constraints to hamper exports while other work suggests that they deter firms' sales at large. Hence, credit constraints might reduce the export-sales ratio or not. This paper assesses the role of credit constraints for the export-sales ratio at the firm level. We explore this hypothesis empirically, using cross-section and panel data on Chinese enterprises compiled by the National Bureau of Statistics of China. We approximate credit constraints by a firm's ratio of liquid debt to sales and, alternatively, the ratio of liquid assets to total assets. In particular, we estimate the impact of these financial fundamentals on the extensive and the intensive margins of firm-level exports in two-part fractional response models. Fixed effects panel regressions point to a negative relationship between export-sales ratios and credit constraints only at the extensive margin. [ABSTRACT FROM AUTHOR]

Abstract: This paper investigates how firm innovation reacts to changes in competitive pressure in the export market. We use the exchange rate appreciation of the renminbi during 2005–2007 as a natural experiment and exploit its differential impact on Chinese manufacturing firms with different export exposure. The appreciation reduced exports and imposed greater competitive pressure on exporters relative to non‐exporters. In response, exporters increased innovation activities more than non‐exporters. Using a difference‐in‐difference approach, we find that the research and development expenditure of exporters increased by 11% more than that of non‐exporters during the appreciation period, and the new product development of exporters increased by nearly 1.5 times more than that of non‐exporters. These results highlight the important role of competition in providing incentives for firm innovation. [ABSTRACT FROM AUTHOR]

The Management Discussion and Analysis (MD&A) section is an important component of a company's annual report, where the management team provides a textual analysis of the company's performance for investors. Due to the existence of agency problems, management is likely to mask any earnings manipulation in order to maximise their salary, build a corporate empire or obtain more financing, which will reduce the reliability of the company's financial information. Utilising 13,679 Chinese A‐share listed companies from 2008 to 2020, this study examines the correlation between management earnings manipulation and annual report MD&A similarity. We find that earnings manipulation leads to increased MD&A similarity in order to reduce the transmission of useful information and thus stymie investors. As such, we recommend that regulatory authorities should monitor the level of similarity and validity of MD&A disclosures in addition to the authenticity of numerical financial information. [ABSTRACT FROM AUTHOR]

This paper examines the effect of credit rationing on export performance by small and medium‐sized firms in China. We use a detailed firm‐level data provided by the Small and Medium‐sized Enterprises Dynamic Survey (SMEDS) during 2015–16 to conduct this analysis. The SMEDS provides firm‐specific measures of credit rationing based directly on firm‐level responses to the survey rather than indirect ones, based on firm‐level financial statements. We find that, at the extensive margin, weak and strong credit rationing reduces export probability of small and medium‐sized enterprises (SMEs) by 15.1% and 39.6%, respectively. At the intensive margin, they decrease SMEs' export values by more than 20.0% and over 28.8%, respectively. Different than existing literature, we construct valid firm‐level instruments, firm‐level housing stock, for credit rationing rather than using province‐level instruments. We also employ county‐industry‐level instruments and obtain consistent estimates. In addition, credit rationing exhibits heterogeneous impacts on firms with different liquidity ratios, product portfolios, external collateral and capital utilisation rates. [ABSTRACT FROM AUTHOR]