Table of Content

15 September 2012, Volume 0 Issue 09

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The Second North Paradox and Its New Solution

YUAN Qing-ming

2012, 0(09):  1562. 

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In the eyes of new institutional economists, one of an important functions of the institution is to lower the transaction costs serving as the “friction” during the economic operation. In theory, transaction costs will be reduced along with the advancement and improvement of the institution of one country. However, according to Wallis and North (1986)’s estimation, in the last 100 years from 1870 to 1970, rather than declining, the ratio of total transaction costs in GNP in United States was getting higher and higher. The contradiction between the theory (along with institutional progress, the transaction costs should be lower and lower) and the reality ( the measured total transaction costs are getting higher and higher) is called “the Second North Paradox”. This paper argues that the total transaction costs measured by Wallis and North are not the entire transaction costs. On the surface, the measured amount of total transaction costs are rising, but in fact, the “theoretical” total transaction costs are falling, that is, along with the institutional progress, not only the transaction costs per transaction are getting down, the theoretical total transaction costs are falling too, therefore, the so-called “the Second North Paradox” does not exist at all.

The Implementation Mechanism of Growth Pole Strategy and the Reconstruction of China’s Practice Mode

TU Wen-ming

2012, 0(09):  1563. 

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The growth pole theory is a new choice after the neoclassical regional balanced development theory was confronted with some crises during the 1950s. But since its birth, it has been controversial due to lacking of support of successful cases. The growth pole mode is well rewarded and respected in China because of the unhomogeneous and imbalanced regions; but it has also encountered the same difficulties in its development. Considering the sharp contrast between theory and reality, this paper makes an analysis of the shortcomings of the theory from the point of the implementation mechanism of the growth pole, points out that there exist such issues as the government relying on rigidness, weak self-development capability, poor correlation effects, etc. in the practice of China’s three major growth poles, and argues that the complete growth pole implementation mechanism should include a formation mechanism, an operating mechanism and a diffusion mechanism and the reconstruction of China’s growth pole practice mode should start from these three mechanisms. Finally, it offers some policy recommendations.

Tax Policy Selection to Promote Shift of Domestic Resident Consumption Model

XI Wei-qun

2012, 0(09):  1564. 

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To improve the economic growth by expanding consumer consumption has been a focus of the 12th Five-year Plan. However, while the resident consumption is still insufficient, there exist such phenomenon as “high material desire, high consumption and high emission”. In order to promote the transformation of the economic development mode and achieve sustainable development, it is crucial that we should give full play to the tax policies to guide the behaviors of the market entities. Therefore, according to the ternary structure of sustainable consumption model of low material desire, low consumption and low emissions, this paper puts forward some recommendations concerning the tax policy system that cover all the links of consumption pattern, such as ecological, environmental, economical links, and combining the guiding, adjusting, encouraging and punishing functions into one, so as to boost the establishment of China’s sustainable consumption mode.

A Study of the Performance of Fiscal and Tax Subsidies from the Perspective of Sustainable Development

ZHOU Xia

2012, 0(09):  1565. 

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This paper carries out an empirical analysis of the economic performance and social performance resulted from the application of the fiscal and tax subsidies from the perspective of sustainable development. The result implicates that fiscal and tax subsidies have no significant effect on the improvement of the economic performance of the enterprises, except that they can improve the corporate liquidity and profitability in a short term, without much influence on the corporate growth. While the social performance is relatively significant, that is to say, the funds of the subsidies are helpful to the enterprises in carrying out their social responsibilities, such as employment increase, environmental protection etc.. Therefore, it is suggested to innovate the use of fiscal and tax subsidies, to detail the items and directions of the subsidy funds, to strengthen the follow-up management and supervision on the funds, and so on, so as to boost the improvement of the performance of the fiscal and tax subsidies.

A Study of Spatial Inequality and Polarization of China’s Financial Development

LIU Hua-jun

2012, 0(09):  1566. 

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Taking the data of China’s 31 provinces from 1978 to 2008 as the sample and the financial relative ratios as the index, this article empirically studies the spatial inequality characteristics and the polarization of China’s financial development. It is found that the visualization approach of GIS (Geographic Information System) can directly indicate that China’s financial development has significant spatial inequality characteristics. The Gini coefficient measurement and it’s decomposition show that the overall disparity of the spatial distribution of China’s financial development presents an extending trend, of which the disparity between the regions are the major source of the regional differences of China’s financial development during the sample investigation period. The result of the financial development polarization degree measurement shows that during the sample period the spatial polarization degree of China’s financial development presents a significant increasing trend. The continuous rising of the polymerization degree within regions and the confronting strength between regions becomes the main source of the rising polymerization degree of the financial development.

Cumulative Inflation and the Changes of Money-Price Relations: An Analysis Based on the Background of Inflation in 2007

JIA Fei

2012, 0(09):  1567. 

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By introducing the factor monetization process into the monetization model of Yi Gang(1995), this paper offers an interpretation of the phenomenon of the co-existence of higher money supply and lower inflation during the period of 1997-2006. The results of the bound cointegration test indicate that the factor monetization process has absorbed money, which proves the money cumulative effect in the financial markets. Based on the 13 states of the capital markets given by the extended capital market equilibrium model, it interprets the accumulation and moving of money between the factor market and the product market. It is found that the cumulated money in financial markets and the easy monetary policies after the crisis jointly formed the money pressure of 2007 inflation. To fight inflation, the total quantity of money should be controlled in the short run and the capital market system should be guided to recover equilibrium in the long run.

A Study of Breakthrough Innovation of Strategic Management: from the Perspective of Risk Investment

LI Zhan-qiang

2012, 0(09):  1568. 

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On the basis of a review of the research literature about breakthrough innovation and risk investment, this paper explores in depth the law of development and features of breakthrough innovation and risk investment, puts forward a model of breakthrough innovation of strategic management process, expounds systematically the six strategic synergy complementary effects of breakthrough innovation strategy management and risk investment in the breakthrough innovation industrialization process, points out the role of risk investment in promoting the implementation of the breakthrough innovation of strategic management. Finally, it indicates the theoretical value and practical significance of this study.

A Study of Professional Managers Incentive?Mode and Its Theory in China’s Family Business: from the Perspective of “Family”Culture

XU Xiao-ming

2012, 0(09):  1569. 

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The impact of Chinese “family” culture is deeply rooted in Chinese family business.?This kind of culture, which has its origination from the patriarchal relations of Confucian culture, affects the Chinese family business at both positive and negative sides.?When a professional manager, an outsider of the family, joins into the business and tries to help its development with his or her professional skills, the “family” culture may show its negative effects, hindering the role the professional manager should play.? It is based on such consideration that we try to take the expectancy theory as a starting point and put forward the following suggestions: during the process of introducing professional managers, the private business should take full account of the attitudes and influences of family members into considerations, develop reasonable performance objectives and remuneration package with the professional manager, and achieve the purpose of effectively motivate professional managers to serve the enterprise by safeguarding the psychological contract between them.

Trade Competitiveness and Trade Price Terms of China’s Manufacturing Industry: A Calculation Based on the Micro Trade Data

WANG Wen-zhi

2012, 0(09):  1570. 

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By establishing a table of comparisons between the 5 digit classified commodities of SITC and 28 China’s manufacturing sectors, this paper calculates the trade competitiveness index and price terms of trade of 28 China’s manufacturing industries with the micro trading data. The results indicate that firstly, the labor intensive sectors have higher trade competitiveness index and the price terms of trade is continuously deteriorating; while the capital intensive sectors have the inverse situations. Secondly, the trade competitiveness index and the price terms of trade in the medium-high technology sectors are changing in the same direction, showing a tendency of increase in both price and quantity; but in the medium-low technology sectors the situations are just the opposite. Thirdly, to further develop the medium-high technology sectors while at the same time to increase the quality of export products of the lower-high technology sectors is an effective way to prevent China’s manufacturing industry from“immiserizing growth”.

An Empirical Test on the Impact of Technology Introduction on the Independent Innovation Ability

FU Yuan-hai

2012, 0(09):  1571. 

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International technology diffusion is the important path to influence the improvement of technical innovation ability of the local enterprise. By making use of the regional panel data from 2003 to 2008, this paper conducts an empirical test on the impacts of different types of international technology diffusion on the technological innovation ability of the domestic enterprises. The results show that the competition effect and the spillover effect of foreign R&D have significant positive impact on China’s lower level technological innovation capability, while no significant impact on the higher level technological innovation ability. The imitation effect reflected by the degree of localized production of foreign-funded enterprises has significant positive effect on the higher level technological innovation capability of the domestic enterprise, while no significant effect on the lower level technology innovation ability. The purchase of foreign technology has significant positive effect on the technical innovation capability at all levels of the domestic enterprises, but the positive effect on the higher level is smaller than that on the lower level.

On the Influence of Debt Structure on Corporate Growth under the Debt Thresholds

LIU Ting

2012, 0(09):  1572. 

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There are two special debt thresholds of 70% and 20% in China under the restrain of the requirements on IPO application by CSRC. Taking 9860 “A” share listed companies from 2001 to 2010 in China as samples for the study, this paper finds out that when the debt ratio is below 20%, long-term debts or bank loans would restrict the growth of the companies, resulting in negative impact on the company value. When it is above 70%, due to the soft budget constraints of the creditors, the long-term debts would increase rather than decrease, pushing the irrational high growth of the companies; and the company value would be damaged if banks conniving their high growth with high risks. When the debt ratios are between 20% and 70%, soft budget constraints would be improved; however, the effects of positive governance on debt are still not significant.

A Study of Government Audit from the Perspective of Citizenship Evolution

HU Nan-wei

2012, 0(09):  1573. 

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Based on the theory of citizenship, the state governance can be regarded as a series of systematic arrangements which are designed for citizenship. Therefore, as an important tool of state governance, the development of government audit has a natural relation to the evolvement of citizenship. The evolvement of citizenship has a tremendous driving force leading to the changes of government audit system. When the citizenship develops to different stages, the government audit will show distinct differences in such aspects as the essence, objectives, service objects, functions, demand causes, realization mechanisms, and so on. Therefore, to explore the development route of government audit in China from the perspective of the evolution of citizenship will contribute to the future development of our government audit.

A Review of Studies of the Impacts of Sovereign Credit Rating on Securities Markets

GUO Ya-jing

2012, 0(09):  1574. 

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As the world financial markets are fluctuating, the impact of sovereign credit rating is becoming more and more important. Lots of researches point out that the adjustment of sovereign credit rating would influence both bond markets and stock markets. However, due to the different sensitive degrees of markets towards information, stock markets have more violent reactions than bond markets; and stock markets react in advance to the adjustment of sovereign credit rating. Because of the resultant action of the market expectation and the economic cycle, there exist in the markets the asymmetric reactions to the changes of positive and negative ratings. Therefore, to sort out and comment on the existing literatures can both improve the understanding of the public towards the issue and provide certain reference for the formulation of risk prevention policies.