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This study investigates the relationship between advanced human capital structure, industrial intelligence, and service industry structure based on China's development from provincial data from 2008 to 2019. It finds that the advanced human capital structure can significantly promote the structural development of the service industry. Meanwhile, there is some heterogeneity in the impact of advanced human capital structure on the service industry. In the eastern region and high level of elemental market development in China, advanced human capital structure has a more significant contribution to the service industry structure upgrade. More importantly, industrial intelligence will play a positive moderating effect on the process of upgrading the human capital structure to the service sector structure. Further, the effect of advanced human capital structure on the service industry's development depends on the threshold of industrial intelligence. When industrial intelligence exceeds the threshold, it can strengthen the "promotion effect" of advanced human capital structure. [ABSTRACT FROM AUTHOR]

Using data from China, this paper investigates the effect of a guarantee network on firms' earnings management. The results suggest that guarantee networks significantly reduce earnings management and this effect is more pronounced under tight monetary policy. Further analyses suggest that guarantee networks reduce earnings management through supervision mechanism rather than financing mechanism and earnings management reduction effect depends on the property ownership and related-party guarantee of the network. Our study provides new insights on the positive effect of guarantee networks in China and contributes to the governance role of guarantee networks. [ABSTRACT FROM AUTHOR]

This paper examines the innovation in companies within business groups. Compared with stand-alone companies, companies within business groups invest more in innovation activities. Further analysis shows that companies within business groups are supported by stronger cash flow from their parent companies and under competition pressure from peer firms within business groups. The effect is more pronounced in the firms in the high-tech industry and competitive regions. The results are consistent with various endogenous and robustness tests. [ABSTRACT FROM AUTHOR]

To evaluate the carbon disclosure quality of China's Shenzhen-Shanghai listed companies and its impact on investor protection, this paper constructs an evaluation index framework for carbon disclosure quality. The content analysis and principal component factor analysis methods were used to calculate the index score of the carbon disclosure quality, while empirical research on investor protection indexes was carried out by the method of variance weighting. This study found that an improvement in carbon disclosure quality can effectively protect the interests of investors, especially those of controlling shareholders and minority shareholders, but the degree of protection of large shareholders' interests decreases with the improvement in the quality of carbon disclosure. [ABSTRACT FROM AUTHOR]

Having effective and reliable risk management is essential for the development of futures trading companies in China. Research analyzing early warnings on related risks for futures trading companies in China have important theoretical and empirical value. In this paper, we take the period during which fluctuation in extreme market risk occurred as the verification period and design overall risk indicators and equations to measure market risk for futures trading companies. We built an early risk warning model using extreme learning machine technology. We tested our model's validity using statistics from China's futures market. Empirical evidence shows that our model is more accurate than models based on the support vector machine, logistic regression, and the back-propagation neural network. [ABSTRACT FROM AUTHOR]

This paper studies the impact of mandatory corporate social responsibility (CSR) disclosures on cost of debt financing (COD) in China, using a quasi-natural experiment that mandates a subset of listed firms to issue CSR reports. We find that these firms exhibit cheaper debt financing after they are subject to this mandate and easier access to long-term bank loans, and the decrease in the COD is more pronounced among firms with longer CSR reports and higher CSR scores and that follow Global Reporting Initiative (GRI) guidelines. In addition, we introduce regulatory theory to verify firms that are politically connected enjoy a greater reduction in the COD after the mandate than those that are not politically connected. Our results have important implications for our understanding of the economic consequences of mandatory CSR disclosures from the perspective of the debt market. [ABSTRACT FROM AUTHOR]

Since being restructured, Chinese rural commercial banks (RCBs) have had two goals: supporting the agricultural sector and sustainable development. This paper aims to analyze the effect of noninterest business development on the performance of RCBs. Our sample consists of 107 RCBs in eight provinces in eastern China. The results of the study demonstrated a U-shaped relationship between non-interest income and the performance of RCBs. The main reason is that at different stages of business development, noninterest business other than fees and commissions has achieved economies of scale. Further analysis found the existence of threshold effects on the performance of RCBs from the development noninterest business. When the cost ratio of non-interest business is higher than 0.2213, non-interest business development has a significant effect on the performance of RCBs. [ABSTRACT FROM AUTHOR]

This study examines the effects of the SARS outbreak on China's real economy using structural vector autoregression models. We find that SARS has had both temporary and persistent adverse effects on output. The temporary effects lasted for only one-quarter and the prolonged effects for approximately two years. By further analyzing China's monetary policy, we find that the accommodative quantity-based monetary policy has greatly hedged the temporary effects of SARS. However, the persistent effects of SARS could have been alleviated if China had eased the price-based monetary policy after the outbreak. [ABSTRACT FROM AUTHOR]

This study uses the 2012 household skills survey conducted by the World Bank in Kunming, China, to investigate the relationship between personality traits and entrepreneurial development with a discrete choice model. The paper systematically examines whether different kinds of personality characteristics measured by the Big Five traits (extroversion, conscientiousness, agreeableness, emotional stability. and openness) and risk preference influence entrepreneurial development in western China. The analysis indicates that personalities have significant effects on entrepreneurship behavior in general. In particular, individuals with higher risk preferences, extroversion, emotional stability, and conscientiousness are associated with a higher probability of choosing entrepreneurship. However, other factors have negligible impacts on entrepreneurship in our results. [ABSTRACT FROM AUTHOR]

This paper integrates changes in the reserve requirement ratio with other related monetary policies and estimates the offset and sterilization coefficients to examine the effectiveness of China's sterilization operations. The results show that China's sterilization operations have been fairly effective and China has been able to control domestic money supply relatively well despite a limited degree of exchange rate flexibility. The results also indicate that the failure to take changes in reserve requirements ratio into account leads to a substantial underestimate of the effectiveness of China's sterilization operations, illustrating that this policy is nonnegligible in studying China's sterilization operations. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the editors discuss various reports within the issue on topics including the relationship of China's financial contagion in international markets, the mutual fund flow in China, and capital structure.

Based on a noncompetitive input-output analysis, this paper estimates the embodied carbon emissions in Sino-Korean trade from 2000 to 2014 from a new value-added perspective. In addition, using structural decomposition analysis, we decompose the factors driving embodied carbon emissions and analyze the carbon emissions responsibilities that China and Korea should each bear under "shared responsibility." Our results show that the traditional statistical method overestimates the true level of embodied carbon emissions and the overestimation rate is about 60%. Moreover, the input technology structure effect and the export scale effect are two important factors accounting for the surplus in China's embodied carbon emissions. In addition, under the principle of "shared responsibility," the carbon emissions values in trade are lower. This study offers a new way to scientifically allocate the responsibility of embodied carbon emissions in trade, which can ease the surplus of embodied carbon in global value chains. [ABSTRACT FROM AUTHOR]

To explore which factors affect changes in carbon dioxide (CO2) emissions in China, based on production decomposition analysis (PDA), and data envelope analysis (DEA), this paper decomposes these changes into nine indicators. Then we measure the effects of these factors and analyze the effects at three levels: the nation, the main regions, and individual provinces. The results are as follows. First, since 2012 aggregate CO2 emissions in China have decreased, indicating the success of government efforts. Second, the effects of various factors on CO2 emissions in the eastern, central, and western regions differ significantly, emissions in the western region are high, and the eastern and central regions have the potential reduce their emissions. Third, the dominant contributors to CO2 emissions are economic growth, the structure of energy consumption, carbon emissions technology, and energy consumption efficiency, whereas the other factors are conducive to reductions in CO2 emissions. Based on our research results, we make some policy recommendations on reducing CO2 emissions in China to promote the coordinated and sustainable development of the economy and the environment. [ABSTRACT FROM AUTHOR]

China has set an ambitious target of achieving the grid parity of solar power by 2020 in the 13th Five-Year Plan. This paper estimates the levelized costs of electricity (LCOE) of centralized photovoltaic power across regions in China with the actual situation in 2016 and simulation scenarios for 2020. Results demonstrate that the LCOEs of centralized photovoltaic power will decrease considerably during the period of 13th Five-Year. Few of them are competitive with generation side electric prices in 2016 basic scenario and 2020 pessimistic situation. Sensitivity analysis reveals that utilization hour, unit investment cost, and financing cost are key driving factors. [ABSTRACT FROM AUTHOR]

According to the tourism-led economic growth (TLEG) hypothesis, the development of tourism encourages economic growth. However, the effects of TLEG are not obvious in the areas of China predominantly populated by ethnic minority groups. The development of tourism might negatively affect factors of production because of local characteristics and hence impede economic growth. Panel data on twenty-nine provinces in China are examined to verify the TLEG theory in this study. The estimated generalized least squares (cross-section weights) method is applied to test the influence of tourism on human capital. Our empirical analysis shows that the development of tourism negatively affects human capital endogenously. Conclusions are provided at the end of this paper accordingly. [ABSTRACT FROM AUTHOR]

This paper constructs an international trade network model to investigate the spillover effects of import decline in China and the US. Our results show that, first, research target countries can be divided into spillover blockers, absorbers, and amplifiers based on whether they transmit economic shocks. Second, for the same degree of decline in import in China and the US, export changes in the major world economies are affected more by the US than by China. In addition, the impact of import decline in the US on China is greater than that in China on the US. Meanwhile, China's original economic shock could be amplified much more than that of the US. Third, in terms of the transmission of economic impact, Asian and European countries are largely affected, whereas countries in South America are least likely to be affected by economic shocks from China and the US. [ABSTRACT FROM AUTHOR]

Using the panel data for sixty-two main Chinese commercial banks during 1997-2012, this paper studies the effect of income diversification on bank risk. According to portfolio theory, the overall risk of banks is decomposed in order to further investigate the contribution of noninterest income. The empirical results show that there is no significant relationship between income diversification and bank risk. The reduction of overall risk is attributed to the significant reduction in the risk of interest income business. While the proportion of noninterest income increases, its volatility also increases, and thus its contribution to overall risk increases. Accordingly, some policy suggestions on the future development of income diversification strategy are proposed. [ABSTRACT FROM AUTHOR]

We analyze the companies listed on stock exchanges in China from 2004 to 2009 and discover that firms' political connections help them obtain bank lines of credit, especially from state-owned banks. The results also show that political connections have a stronger effect on the acquisition of bank lines of credit for firms that face more financing constraints, are not owned by the state, or are located in regions with intensive government intervention. This paper deepens the field's understanding not only of bank lines of credit but also of the role that political connections play in firms' financing activities. [ABSTRACT FROM AUTHOR]

This paper applies a contingent claim model to examine the risk of and returns to foreign financial institutions after they acquire equity stakes in a Chinese bank. The model considers dynamic factors such as individual asset value and exchange rates in maximizing shareholder value. In addition to analyzing the asset value and factors associated with risk after participation, this paper evaluates the optimal acquisition equity stake ratio using numerical analyses under regulatory capital control. For the Chinese banking sector, we discover that the portfolio risk of foreign financial institution will decrease after acquiring equity stakes when its asset increases, the debt ratio decreases, and the required risk-weighted asset increases. Overall, these foreign financial institutions have well-diversified currency portfolios and enjoy better asset quality and surplus earnings; therefore, they will likely increase their optimal acquisition equity stake ratio if the Chinese banks in which they invest have with good quality assets and are focused on local business. [ABSTRACT FROM AUTHOR]

The impact of the intra-government (vertical) tax competition on firms' location choices is seldom studied in the literature. In this paper, we use the local corporate income tax revenue retention rate to represent the outcome of the vertical tax strategic interactions between the central and local governments in China. Theoretically and empirically, we find that a higher local corporate income tax revenue retention rate attracts newly-established firms, even when we simultaneously take into account the effect of the horizontal tax competition, i.e., the local effective corporate income tax rates. Such positive effect of the local corporate income tax revenue retention rate on firms' location decisions is robust to a battery of sub-sample analyses and alternative model specifications, and is heterogeneous across firms with different ownership structures. This effect is more prominent in provinces with weaker agglomeration forces as well. [ABSTRACT FROM AUTHOR]

The increasingly serious environmental problems, such as rising sea levels and heavy smog, have made environmental consciousness in society more urgent. The key issue is how to motivate firms to disclose environmental information. In this paper, we use data on 200 listed enterprises in China as a sample and research the factors that affect voluntary carbon disclosure. We found that local government regulatory pressure and social pressure have different levels of influence on carbon information disclosure of state-owned enterprises and non-state-owned enterprises; local government regulatory pressure have a greater impact on state-owned enterprises' carbon information disclosure, while social pressures have a greater impact on non-state-owned enterprises. Finally, we make some suggestions aimed at promoting disclosure of carbon information. [ABSTRACT FROM AUTHOR]

This paper studies the environmental efficiency of Chinese urban agglomerations (UAs) based on a non-parametric meta-frontier approach. We find most of UAs has a large gap and imbalance of environmental performance under meta-frontier. The meta-efficiencies of eastern and southern coastal areas are better than that of middle and western. Besides, the efficiency difference of cities in each UA is relatively small, which may be caused by the technology spillover effect. In addition, the average technology gap among most UAs exists but not so huge. Based on the findings, we provide specific suggestions for Chinese central and local governments. [ABSTRACT FROM AUTHOR]

China's rural economy growth since the reform has been very rapid. The informal finance including the bidding Rotating Savings and Credit Association (ROSCA) has emerged to meet increasing funding needs of rural residents. This paper conducts a survey on Chengnan Village in Wenzhou to analyze how bidding ROSCA operates and the roles bidding ROSCA's participants play as investors and borrowers, and thus to identify the potential risk. By explaining bidding ROSCA's both internal and external risk management mechanisms, it finds that village ethical community is the informal institutional foundation of risk management. [ABSTRACT FROM AUTHOR]

Although aid is an important tool for facilitating the integration of developing countries into global value chains (GVCs), there is lack of empirical research to support this view. This study thus examines the impact of China's aid on the development of GVCs in recipient countries. The conclusions of this study are as follows: (1) China's aid can significantly promote recipient countries to transform into GVCs. (2) The improvement of infrastructure in recipient countries is the main channel through which China's aid affects the degree of integration of recipient countries' GVCs. (3) Aid type, technology distance, and trade complementarity have a certain heterogeneity in the current study's research results. From the perspective of GVCs, this study proves the effectiveness of foreign aid in the economic development of recipient countries and helps expand the research boundary of foreign aid. [ABSTRACT FROM AUTHOR]

This study investigates the effect of employee compensation on corporate investment decisions using a sample of Chinese listed companies during the period 2007–2019. We find that the improvement of employee compensation competitiveness reduces the overall investment level, but improves the investment efficiency, which supports the capital-skill complementarity theory and the liquidity constraint theory, rather than the displacement theory. We use the social insurance law as a quasi-natural experiment, and the adjustment of the personal income tax rate as an instrumental variable to relieve the endogeneity concern. In addition, cross-sectional analysis and mechanism analysis show that employee compensation competitiveness can crowd out enterprise investment and improve investment efficiency by increasing liquidity constraints, thereby improving the quality of human capital and increasing innovation. Overall, this study provides insights into how employee compensation reduces corporate investment and increases corporate investment efficiency in developing countries. [ABSTRACT FROM AUTHOR]

A significant feature of corporate governance in China is the participation of party organizations, reflecting the involvement of the Chinese political party system in enterprises. Using a sample of A-share market listed central state government owned enterprises (hereinafter referred to as "CSOEs") from 2003 to 2020, this study examines the influence of China's political party system and state-owned assets supervision system on enterprise innovation. The empirical results show that the participation of party organizations in corporate governance can significantly promote CSOEs' innovation, especially in the case of CSOEs with weak state-owned assets supervision. The party organization's role in promoting innovation is mainly achieved through the board of directors and senior management, rather than through the cooperation of the board of supervisors. We also find that this role exists in both substantive and strategic innovations, but mainly exists in areas with weak market allocation resources. Our findings contribute to the literature examining the determinants of firm innovation, and have practical implications for corporate governance in developing countries. [ABSTRACT FROM AUTHOR]

This research constructs a double difference model to test the impact of LCCP on green innovation by using urban panel data of 276 cities in China from 2005 to 2019. Findings show that LCCP effectively improves the level of green innovation performance, and the conclusion is robust. Its effect is more obvious in cities with high scientific and educational levels as well as big cities or eastern cities of the country. LCCP enhances the performance of urban green innovation by driving technological innovation, upgrading the industrial structure, and optimizing urban public services. This research is significant for realizing high-quality economic development. [ABSTRACT FROM AUTHOR]

We examine the short-term impact of the COVID-19 pandemic on household asset allocation in China. The results show that in the first quarter of 2020, households generally save more. Basically, higher regional risk generates stronger motivation to increase precautionary savings. Households generally adapt to more conservative asset allocation strategies, the demand for low-risk asset increases, while the demand for high-risk and high-liquidity asset decreases. We find significant regional differences in household allocation strategies for high-risk and low-risk assets. These results could be due to the regional heterogeneity of time allocations. [ABSTRACT FROM AUTHOR]

There is an urgent need to understand the spillover and cojump effects between the U.S. and Chinese stock markets. The paper finds that since July 2005, the U.S. stock market has caused short-run spillover effects on returns on the Chinese stock market. More specifically, price changes in the United States can be used to predict both closing-to-opening and closing-to-closing returns on the Chinese stock market on the next day. However, there is no significant volatility spillover between the two markets. Both markets have shown stronger cojump behavior since the subprime crisis. The return relationships between the two stock markets are robust. [ABSTRACT FROM AUTHOR]

China's unique split-share structure has resulted in serious agency problems. Moreover, the literature has shown that free cash flow and overinvestment problems are common in China's listed firms. This paper investigates the impact of the split-share structure reform on agency problems. The paper finds a decrease in investment-cash flow sensitivity after the reform of the split-share structure, which is evidence for a decrease in agency problems in China's listed firms after this reform. The result implies that the split-share structure reform has eased the agency problems in China's listed firms. [ABSTRACT FROM AUTHOR]

This paper examines the impact of openness on financial development in China. We use two sets of indicators of financial development to distinguish size and efficiency for both bank and capital market sectors as aspects of financial development in 30 provinces of China over the period from 2000 to 2009. The empirical results suggest that trade and financial openness exert positive impact on financial efficiency but negative impact on the size of financial development for both the indirect and direct financial sectors. The results confirm a mismatch problem between the distribution in the types of trading companies and the allocation of financial resources in China. [ABSTRACT FROM PUBLISHER]

The paper estimated the balance of emissions embodied in bilateral trade and the pollution terms of trade between China and six major world economies, including USA, Japan, and others, from 1995 to 2009, and then discussed the factors affecting them using the Structural Decomposition Analysis method. We find that, with the exception of Taiwan, the balances of the haze pollutants emissions embodied in bilateral trades were negative between China and the each of the rest five, and this was mainly resulted from the China export scale effect and intermediate input structural effects. We also find that China has become the “Pollution Refuge” for the economies like USA and Japan. [ABSTRACT FROM AUTHOR]

This paper studies the role of reserve requirements as a macroprudential policy tool in China. In a factor-augmented vector autoregression of China, we find that banking system works as a shock absorber. To explain this "financial attenuator" effect, we extend an otherwise standard New-Keynesian model including (i) a banking sector with financial frictions with households, (ii) a credit in multi-period contracts, (iii) a central bank that conducts monetary policy by adjusting the nominal interest rate in response to the money-growth rate, and (iv) the reserve requirement (RR) as a macroprudential policy instrument. The quantitative analysis of the estimated model shows that the presence of a maturity mismatch makes a bank's leverage less procyclical, which offsets the effects of financial frictions and makes the bank's balance sheet function as a shock absorber. Our analysis also suggests that countercyclical RR adjustment can enhance welfare compared to fixed an RR ratio in the presence of a maturity mismatch but faces important implementation challenges. In particular, an RR policy countercyclically responding to bank lending can effectively stabilize the economy but increase financial fragility, as the "credit attenuator" effect stemming from the maturity mismatch will be offset by this policy. [ABSTRACT FROM AUTHOR]

This paper proposes a novel model for establishing a credit evaluation system, including a system of indicators, indicator weights, and credit scores. A credit evaluation system whose evaluation results have significant discrimination is good. Based on this standard, we construct an objective programming model with the maximum discrimination of credit scores as the objective function. The main constraint condition is that the indicator weights sum to 1, and weight is a decision variable. After we delete indicators whose weight is 0, we design a system of indicators, and then obtain credit scores with the maximum discriminatory power. Our empirical study of China's 3,045 small businesses confirms that this model is both easy to use and reasonable. The empirical results show that, compared to logistic regression and CHAID decision trees, our model has greater accuracy based on F, AUC, and KS tests. [ABSTRACT FROM AUTHOR]

Because of asymmetric information between issuing companies and investors, media coverage plays an important role in conveying information to investors during an initial public offering (IPO). The stock price is affected by a large amount of information released to the public through media coverage. Using a comprehensive sample of 1,075 IPOs on China's stock market from 2009 to 2016, this paper conducts a textual analysis to determine the tone of media coverage and examines the relationship between media tone and IPO underpricing as well as post-IPO volatility. The empirical results show that media coverage during an IPO is significantly negatively associated with IPO underpricing, which confirms our hypothesis that the tone of media coverage reduces the degree of information asymmetry between investors and issuers, regardless of whether the tone is positive or negative. Consistent with prospect theory, investors are more sensitive to media coverage with a negative tone. [ABSTRACT FROM AUTHOR]

In this paper, we use the combination weight of game theory to evaluate a comprehensive index of new-type urbanization and then dynamic panel data for Chinese provinces over the period 2001 to 2016 to investigate the synergistic effects between financial development and improvement in new-type urbanization. Our results are based on system-generalized method of moments, and estimators indicate that the financial development variable measured by each dimension has different impacts on the level of new-type urbanization, respectively. The level of financial deepening measured by the total loan balance of all financial institutions divided by gross domestic product has the maximum impact on urbanization, and the financial structure has a minimal effect, confirming that a bank-dominated financial system supports improvement in new-type urbanization at the current stage. From the perspective of time periods, small- and medium-sized enterprises (SMEs) have a more obvious effect in the post-crisis period than the period 2001 to 2008. The stock market's promotion effect on new-type urbanization also increased; thus, it is playing a greater role. These results imply that policies such as improving SMEs efficiency, optimizing the financial structure, and relaxing restrictions on private investment are likely to promote further improvement in new-type urbanization in China. [ABSTRACT FROM AUTHOR]

The big data on the value-added tax (VAT), which links upstream production and downstream consumption, can serve as a key basis for a structured macroeconomic analysis. This paper discusses the construction and aggregation method of the transaction matrix between enterprises based on this data and develops a multiregional input-output (MRIO) table. The intraregional structure of this table is consistent with the IO table in China's national statistics and includes more detail on the domestic value chain. We use big data on the VAT in creating an analytical tool to track profit shifting and tax avoidance. Therefore, this new MRIO table can coordinate consumption-based measures with the "destination principle" in international VAT statistics. [ABSTRACT FROM AUTHOR]

A reasonable energy structure can secure the orderly development of the economy and effectively control carbon emissions. This paper builds a CGE (Computable General Equilibrium) model that incorporates the carbon market module, uses 2012 as a base period, and uses carbon prices and energy investments as starting points to simulate and assess China's impact on macroeconomics and carbon markets under three scenarios. The results show that a reasonable energy structure has a positive impact on macroeconomics, and macroeconomic indicators under the three scenarios show an increasing trend compared with 2012. The comparison of economic indicators under the different scenarios shows that the expected energy structure of the 12th Five-Year Plan is the most judicious among the three scenarios and can produce greater economic benefits with lower energy investments. The study concluded that carbon market spending as a percentage of GDP is the most appropriate indicator for analyzing the relationship between carbon prices and carbon dioxide emissions. Our analysis of the indicators found that the higher the carbon price, the smaller the carbon dioxide emissions, and the lower the carbon price, the greater the carbon dioxide emissions. This article will help provide a reference for China's future energy structure adjustment. [ABSTRACT FROM AUTHOR]

This paper examines entry mode choices between wholly owned subsidiaries (WOSs) and joint ventures (JVs) and the impact on performance for Taiwanese foreign direct investment in China. Taiwan and China share common cultural traits, so Taiwanese investors inherently prefer WOSs because these investors are acquainted with local conditions in China. This paper shows that even if WOSs are a natural choice, transaction cost theory is applicable in explaining the adoption of JVs by Taiwanese firms when investing in China. Firms that choose WOSs generally have higher sales growth and superior profitability. However, the smaller the subsidiary and the less experienced the firm, the more likely that JVs will have better performance. [ABSTRACT FROM AUTHOR]

China's share of global trade has experienced rapid growth in the past three decades. Taking a demand-side perspective, this paper investigates the causes of this rapid growth by decomposing China's trade growth into preference changes, income growth, and other factors. The results indicate that preference changes explain 35.8 percent of export growth and 41.9 percent of import growth over the period. Income growth (excluding convergence) explains a further 28.4 percent and 27.1 percent, respectively, of export and import growth, respectively. In addition, income convergence further contributed about 24 percent and 11.3 percent, respectively, of export and import growth, respectively. These results are generated using a multiregional numerical general equilibrium model of the global economy involving major trading blocs and are calibrated to both 1975 and 2004 data. [ABSTRACT FROM AUTHOR]

This paper studies empirically the determinants of Chinese commercial banks' net interest margins from 1996 to 2003. It applies an extension to the Ho and Saunders (1981) model to identify the elements affecting net interest margins. The results indicate that the determinants of net interest margins in the Chinese market include market competition structure, average operating costs, degree of risk aversion, transaction size, implicit interest payments, opportunity cost of reserve, and management efficiency. [ABSTRACT FROM AUTHOR]

This paper discusses and examines the development of an Asian bond market, which serves as a bridge to establish financial cooperation in the region. The issues of currency denomination are discussed. In addition, the role that China may play in the establishment of the bond market is presented and analyzed. It is argued that cooperation between China and Hong Kong is desirable to further enhance the development of the market. [ABSTRACT FROM AUTHOR]

Based on Chinese provincial-level data, this paper integrates the adjustment variables of the characteristics of Chinese outward foreign direct investment (OFDI) into a "standard structural" model and analyzes the impact of OFDI on China's industrial upgrading. First, OFDI can promote industrial upgrading in countries that are targets of investment. Second, the rapid investment process restricts the industrial upgrading effect of OFDI. This means the different tempo will make enterprises in the investing country unable to adapt to the rapid changes in market demand. Third, the irregular investment process will restrict the industrial upgrading effect of OFDI. OFDI has a slower, planned, regular, continuous pace that gives enterprises in the country making the investment time to adjust. Last, the industrial upgrading effect of OFDI in different regions of China are affected by the characteristics of adjacent regions. That is, the OFDI in each province in China is affected by the investment mode of neighboring regions. [ABSTRACT FROM AUTHOR]

The process of opening the Chinese stock market has sped up in the last two decades. This paper investigates the effects of the uncertainty in the US measured by news-implied volatility on the Chinese stock market volatility. Our empirical results for the full sample period (1997–2016) reveal that there is no clear effect of US uncertainty on fluctuations in China's stock market. However, based on the subsample analysis along the opening progress in the Chinese stock market, we observe that US uncertainty had a significant effect on Chinese stock market volatility after Qualified Foreign Institutional Investors (QFII) and Renminbi QFII were allowed to invest in the Chinese stock market. The results are the same after the global financial crisis. Our results imply that the US uncertainty should be considered by investors deciding on investment strategy. The government should also consider the US uncertainty when enacting the policy on opening policy the Chinese stock market. [ABSTRACT FROM AUTHOR]

This paper decomposes stock volatility into a market-driven component and an idiosyncratic component using the generalized dynamic factor model and then investigates the influence of media coverage on them. Based on the Baidu Media Index and composite stock data in the CSI 300 Index, we found that the influence of media coverage on market-driven volatility appears to be U-shaped, but the influence on idiosyncratic volatility is negative. Our results show that, in China, the news media generally play a role as information providers on the stock market. However, when the stock market is in a volatile period, media coverage exacerbates that volatility. [ABSTRACT FROM AUTHOR]

This paper uses a wavelet approach to examine the relationship between gold prices and the Chinese stock market over the past quarter-century. Our empirical study with weekly data shows that gold cannot be used as a short-term hedging tool in China in the full sample period, but it can be used as a long-term hedging tool in the sample period after 2005, concurrent with changes in Chinese government policy. This conclusion also emerges when weekly data are replaced by monthly or daily data. However, similar changes in the long-term hedging ability of gold are not observed in the UK and the US. Thus, this change in the ability of gold to serve as a hedge in China can probably be attributed to shifts in some important market policies, such as the reform in nontradable shares in the Chinese capital market and the exchange rate reform in 2005. [ABSTRACT FROM AUTHOR]

In this paper, we study the influence of uncertainty in economic policy on the business operations distribution using data from China. In doing so, we rely on the China Economic Policy Uncertainty Index and focus on large firms that have subsidiaries to which they can distribute these business operations. Our empirical testing find that companies' business operations distribution has a negative relationship with uncertainty in economic policies. Further, under the environment of uncertain economic policy, first, the distribution of business operations will converge; second, companies tend to distribute operations to subsidiaries if they have dependence on external financing; third, state-owned companies are more likely to distribute business operations to subsidiaries; finally, companies will distribute business operations within the parent companies in the high degree of financial marketization. [ABSTRACT FROM AUTHOR]

Ownership concentration and ownership identity are important corporate governance mechanisms. This paper seeks to understand how ownership concentration and identity affect firm performance in an important emerging economy-China. It hypothesizes that differences in firm performance are a result of various ownership structures and ownership identity. Using data of Chinese listed companies from 2007–2017, it tests those hypotheses and finds that ownership concentration has a positive effect in firm performance and corporate ownership leads to higher firm performance than financial ownership. The study shows that firms in China benefit more from foreign ownership than firms with only domestic ownership. [ABSTRACT FROM AUTHOR]

This study explores the effectiveness of large shareholders' "voting with their feet," in motivating a listed company to alter its non-dividend payout behavior. We show that the split-share structure reform, which changed the company's shares held by controlling shareholders and other large shareholders from nontradable shares to tradable shares, gave large shareholders the ability to exit and therefore could inhibit this behavior. Furthermore, when a company has a higher ownership concentration of controlling shareholders and a lower quality of external auditing, the inhibitory effect is more significant. This paper considers China representative of emerging markets and suggests another way to manage the non-dividend payout behavior of listed companies in emerging markets. [ABSTRACT FROM AUTHOR]

This paper investigates the dynamic dependence structure between the Chinese stock market and the real exchange rate of the Chinese renminbi (RMB) with unconditional and conditional copula models for the period July 22, 2005, to December 31, 2017. The results show that the crisis induced significant structural breaks, and the relationship is weak before the global financial crisis but substantially stronger after the financial crisis, regardless of whether the correlation is positive or negative. Our findings have important implications for global portfolio diversification, risk management, and China's exchange rate policy. [ABSTRACT FROM AUTHOR]