Search

We investigate the relationship between functional subsidies, selective subsidies, and investment efficiency through meticulous compilation of information on government subsidies, and the implementation of an innovative categorization methodology based on the nature and timing of funds (ex-ante versus ex-post). Our findings suggest that the effects of subsidies exhibit asymmetry by alleviating underinvestment while exacerbating overinvestment, and functional subsidies exert a stronger influence compared to selective subsidies. Financial constraints are found to serve as the major mechanism, and firms with easier access to financing may not effectively utilize subsidies, while those facing severe financial constraints are less prone to misusing them. • We distinguish functional subsidies from selective subsidies through compilation of information on government subsidies. • Functional subsidies exert a stronger influence on investment efficiency compared to selective subsidies. • The effect of subsidies exhibit asymmetry by alleviating underinvestment while exacerbating overinvestment. • State ownership, firm size and dividend payments lead to heterogeneity in the effects of subsidies. • Corporate financial constraints serve as one of the mechanisms. [ABSTRACT FROM AUTHOR]

Abstract This study explores asymmetric effects of monetary policy on firm scale at different firm size levels. We find that Chinese firms respond to raising benchmark lending interest rates and deposit reserve requirements by decreasing their scales. Our quantile regression results also indicate that larger firms respond more strongly to both policy instruments by adjusting their scales to a greater degree than smaller firms. Moreover, SOEs react less strongly to policy changes than non-SOEs at all firm size distribution. The impact of monetary policy on firm scale is also stronger after commercial banks having greater leeway in setting interest rates. Highlights • Explore asymmetric effects of monetary policy on firm scale at different firm size levels. • Chinese firms respond to raising benchmark interest rates and deposit reserve ratios by decreasing their scales. • Larger firms respond more strongly to both policy instruments by adjusting their scales to a greater degree. • SOEs react less strongly to monetary policy changes than privately controlled listed firms at all firm size distribution. • The impact of monetary policy on firm scale is stronger when banks having greater leeway in setting interest rates. [ABSTRACT FROM AUTHOR]

This study tests the impact of carbon neutrality initiatives on shareholder value and explores how equity returns achieved as a result of carbon neutrality vary across operating environments. Based on 226 carbon neutrality announcements made between 2017 and 2021, we conducted an event study to estimate the impact of carbon neutrality initiatives on Chinese firms' shareholder value. Under the opportunity-motivation-ability (OMA) framework, we further analyzed the heterogeneous effects of distinctive firm characteristics (social rating and firm size), in which carbon neutrality announcements represented opportunity, social rating represented motivation, and firm size represented ability. We further demonstrated how the announcement characteristics and industry differences affected stock market responses. The results indicate that carbon neutrality initiatives have a significant average abnormal return of 0.99% on the announcement date and a positive long-term impact on shareholder value. This equity return is more pronounced for smaller firms with higher social ratings, and the stock market reacts less positively to firms that announce carbon neutrality initiatives in social responsibility reports. The stock market does not react strongly to manufacturing firms' carbon neutrality initiatives. The study provides some important insights toward the CSR-firm performance debate by providing a new measurement of CSR (i.e. carbon neutrality initiative) and examining the relation from an OMA perspective and looking into some contingency factors. [ABSTRACT FROM AUTHOR]

Construction industries have significant impacts on the economy, society and environment. To transform construction industry towards sustainability, construction enterprises' perceptions and performance on sustainability needs to be understood and evaluated, which has not be fully explored by existing studies. This paper holistically examines the Chinese construction enterprises’ attitude towards and performance on various aspects of sustainability (e.g. the economic, social and environmental aspects) in order to identify those aspects the firms perceive to be the most and least important and those aspects the firms perform best and worst on. The associations among the sustainability attitude, sustainability performance, and firm size are also explored. The findings show that quality management and customer service are perceived as the most important as well as the best-performed aspects by the firms while supporting community development is the least important and worst-performed aspect. Sustainability attitude is positively correlated with performance, and larger firms tend to have better sustainability performance than that of small ones. However, larger construction firms do not necessarily perceive sustainability more important. This study provides a useful reference for policy makers and researchers to understand how sustainability is perceived and implemented by the Chinese construction firms. [ABSTRACT FROM AUTHOR]

The size and number of firms in a region represent key characteristics of that regional economic ecosystem, but few studies have linked such characteristics with the stringency of local environmental regulation. In this study, we discuss the effects of local firm scale on environmental regulation and its mechanism, and the optimal strategic choices theoretically and empirically for environmental regulation in regions with different firm scale. We find that when government capacity is insufficient, regional environmental regulation will be relatively more stringent when dealing with fewer but larger firms because of the government scale effect. When government capacity is sufficient, firm size has no influence on environmental regulation. Our results are robust and offer insights for government decision makers to improve local environmental regulation efficiency. [ABSTRACT FROM AUTHOR]

Exploring the drivers of declining energy intensity is necessary in order to accelerate the transition to a low-carbon economy in China. To date, studies have typically adopted case analysis to link enterprise features and energy-saving performance. The impact of internal industrial configuration in terms of size and ownership structure on aggregate energy intensity remains to be examined. To fill this research gap, this paper tests the impact of the internal structure of industries on city-level energy intensity, by employing a unique panel dataset of 283 cities for the period 2005 to 2010. The Driscoll-Kraay method and instrumental variable are used to treat residual cross-sectional dependence and endogeneity, respectively. Results suggest that small-scale enterprises exerts a negative effect on energy intensity. A 1% increase in the output-value proportion of small-sized firms will lead to a decrease in total energy intensity of 0.067%. In contrast, the same change by medium enterprises will raise energy intensity by 0.031%. A negative and/or non-significant coefficient suggests that for most energy-intensive large and state-owned enterprises, China's 2006 top-down energy-saving regulation has been quite effective in targeting key energy-intensive enterprises in China. The findings reveal that state-owned enterprises (SOEs) can act as promoters of, rather than barriers to, low-carbon policy implementation in China. Given that the effectiveness of energy-saving regulation will be undermined as a result of diluted regulatory strength in each enterprise, market-oriented energy price reform is proposed as a fundamental driver for guaranteeing a continual decline in energy intensity. [ABSTRACT FROM AUTHOR]

The increasingly complex environmental governance causes the authorities responsible for implementing environmental policies fragmented. Whether environmental policy integration could improve governance effectiveness remains unclear. This paper investigates the short-term impact of China's One Permit Management (OPM), aiming at integrating existing environmental regulations, on environmental performance. Using unique high-frequency facility-level data and the difference-in-differences-in-differences (DDD) approach, we find that noncompliant facilities reduced emissions after being issued the discharge permit. Specifically, COD, NH 3 -N, SO 2 and NO X declined by 7.75%, 29.88%, 18.21%, and 11.04%, respectively. In addition, the analysis of the heterogeneity of firm size suggests that large firms that interact more frequently with regulators are less affected and the analysis of heterogeneity in the capacity of regions to implement policy integration shows that the effect of policy integration is more significant in eastern regions. The emission reductions of COD, NH 3 -N, SO 2 and NO X achieved by the issuance of pollution permits accounted for 7.72%, 14.66%, 11.31% and 19.89% of the five-year target emission reductions, respectively. Given the prevalence of policy fragmentation, policymakers need to focus not only on how to set goals, but also on how to achieve those goals in a coordinated and coherent manner. • China's one permit management reform is a successful case of policy integration in response to policy fragmentation. • One permit management reform improves the environmental performance of treated polluters. • Large firms that interact more frequently with regulators are less affected by policy integration. • The effect of policy integration is more significant in eastern regions. • China's one permit management reform achieves 7.72%–19.89% of the five-year target emission reductions for major pollutants. [ABSTRACT FROM AUTHOR]

In the context of the popular development of the low-carbon economy, the "high energy consumption, high pollution, and high emissions" of the manufacturing industry have resulted in unprecedented difficulties in the development of this industry. To achieve nationally determined contribution targets, China has formulated a series of low carbon development plans for heavy industry to reduce carbon emissions. Among these, low-carbon technological innovation has been used a new means for manufacturing enterprises to achieve sustainable development, which is highly valued by management practice. Taking Chinese manufacturing companies as an example, the present study investigates the mediating effect of green core competence on the relationship between low-carbon technological innovation and enterprise performance and evaluates the moderating impact of firm size on this relationship. In this study, 438 valid data points were empirically analyzed, and the results indicate that low-carbon technological innovation significantly and positively affects enterprise performance of manufacturing. Green core competence plays a mediating role in the positive effect of low-carbon technological innovation on enterprise performance. Firm size has a positive moderating effect on the relationship between low-carbon technological innovation and enterprise performance. Meanwhile, firm size also moderates the relationship between low-carbon technological innovation and green core competence. Namely, a larger firm size correlates with a more positive effect on the cultivation of green core capabilities from the low-carbon technological innovation of manufacturing companies and in stronger enterprise performance. Finally, this work provides constructive guidance for Chinese manufacturing companies on how to practice low-carbon production and achieve sustainable development. [Display omitted] • Low-carbon technological innovation promotes enterprise performance of Chinese manufacturing. • We examined the model using a large sample of Chinese manufacturers. • This relationship is partially mediated by green core competence, and moderated by firm size. • Firm size exerts a positive moderating effect on low-carbon technological innovation and green core competence. [ABSTRACT FROM AUTHOR]

In scientific journals published all over the world, the economic performance of firms with ISO 14001 certification is a highly controversial topic. This controversy is particularly evident in developing countries. With regard to this topic, we maintain a neutral position in this paper. Using the data of 63 firms from the Shenzhen and Shanghai Stock Exchanges in China during the period of 2003–2018, and employing the difference-in-difference method, we analyze the influence of ISO 14001 certification on firms' financial performance. We also examine the moderating effect of firm size and age, considering the time factor. In addition, we test the influence of ISO 14001 certification on exports, using China's provincial data from 2008 to 2018. The results indicate that ISO 14001 certification negatively affects the financial performance of firms; also, the negative effects decrease in line with the increase of certification time. Firm size and age are positively related to the relationship between ISO 14001 certification and a firm's financial performance. At the same time, ISO 14001 certification can effectively improve a firm's competitiveness in the international market. The study combines two opposing positions found in existing literature regarding the effectiveness of ISO 14001 certification. The results show that ISO 14001 certification will ultimately have a positive impact on China's economy, but that influence should be correctly evaluated in terms of the effect on small and medium-sized enterprises. Some suggestions for firm managers and the government are then discussed. [ABSTRACT FROM AUTHOR]

Supported by preferential policies and government funding, the technological innovation of China's photovoltaic industry has been improved greatly. As a capital-intensive practice, will innovation activities in China's photovoltaic industry be affected by the continuous decline of government subsidies in recent years? Therefore, it is essential to study the relationship between government subsidies and innovation performance of Chinese photovoltaic industry. However, there is less empirical research on this topic. In this context, this study aims to supplement existing studies by proposing a micro-level perspective to measure the innovation performance based on the data of Chinese listed photovoltaic companies from 2012 to 2016. Moreover, we assess the effects of government subsidies and other influencing factors on innovation performance. The findings reveal that, firstly, the average innovation efficiency of Chinese listed photovoltaic companies is over 0.9, which is relatively high. Secondly, government subsidies make a positive influence on innovation performance. Thirdly, financial leverage and ownership concentration have significant positive impacts, while firm size has a significant negative effect on the innovation efficiency of China's photovoltaic industry. The findings will serve as a reference for policy-making to promote further technological progress and sustainable development of China's photovoltaic industry. • This paper estimates the innovation performance of China's photovoltaic industry based on the micro perspective. • This paper conducts a comprehensive analysis by a two-stage DEA-Tobit model. • The overall innovation efficiency of Chinese photovoltaic enterprises is high relatively but still has progress potential. • Government subsidies make a positive influence on technological innovation efficiency of China's photovoltaic industry. • The findings will serve as a reference for policy-making of government and enterprises. [ABSTRACT FROM AUTHOR]