Table of Content

15 April 2014, Volume 0 Issue 04

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A Political Economics Analysis of U.S. Pressure Exerted on RMB Exchange Rate

HAN Hui-chao, XU Kang-ning

2014, 0(04):  1623. 

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The political economics can provide a new perspective to explain the phenomenon that U.S. exerts pressure frequently on the issue of RMB exchange rate which is hindering the Sino-US trade. An empirical analysis with the Probit model on the U.S. congress bill of The Currency Reform for Fair Trade Act in 2010 illustrates that the political contributions of the interest groups have intensified the congressmen’s tough policy attitude on the RMB exchange rate issue, also the factors such as Sino-US trade impact, industrial structure and population structure of the state from which the congressmen come have influenced the congressmen’s attitude on RMB exchange rate policy. In conclusion, it is the result of the game based on the relationship of interests between the interest groups, congressmen, constituency, etc. that leads to U.S. exerting pressure on the RMB exchange rate issue.

Price Signaling Game in the Environment of Incomplete Information: Evidence from Taobao.com

ZHOU Geng

2014, 0(04):  1624. 

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By making use of the trading data from Taobao.com, this paper divides the online shopping process into two stages to conduct an analysis. The results confirm that the price signaling game in China’s online market converges on separating equilibrium. This indicates that price which represents quality information of commodities in the environment of uncertain information has a positive impact on demand. This positive effect occurs mainly in the first searching phase of shopping. However, during the final decision making stage, the law of demand is still effective, leading to the generally negative impact of price on demand. Different from the mechanism of direct price rising in the auction market, reputation can indirectly promote product sales in the price-clearly-marked markets and enhance the signal transmission of prices; while the existence of herd behavior may weaken the signal transmission of price to a certain degree.

Three Functions of Chinese Consumption Tax: Effect Evaluation and Policy Adjustment

JIA Kang, ZHANG Xiao-yun

2014, 0(04):  1625. 

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In most developed countries, the function of consumption tax is mainly reflected in the organization of tax revenue, the regulation of the consumption structure, and more distinctly in the correction of externalities through raising the prices of taxable consumer goods. This empirical analysis shows that in recent years, although China has made some adjustments on the items and tax rates of the consumption tax, yet the overall effect of the consumption tax is still limited. Therefore, further adjustment and reform of the consumption tax policy must be carried out in the four aspects: the first is to strengthen the three functions of consumption tax and expand the proportion of consumption tax in the GDP; secondly, to give full play to the externality correction function of the consumption tax, to expand, add more items and integrate the consumption tax; thirdly, to give reasonable play to the revenue regulation fuction of the consumption tax with clear target and full regulation; the fourth is to make a reasonable division of the central and local taxes, so as to match the reform of the optimized institution.

The Optimal Public Debt Scale: An Analysis Based on an Extended AK Model

ZHU Wen-wei, CHEN Yong

2014, 0(04):  1626. 

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On the basis of an extended AK model, an optimal ratio of public debt to GDP can be derived in theory. This ratio depends on the four factors, i.e. a country’s output elasticity of public capital, the ratio of public capital from tax revenues, the proportion of public debt converting into public capital and the ratio of government revenue to GDP. The overall public debt scale in China has not yet hit the debt threshold, there exists certain room for borrowing money; however, the public debt levels in some regions have been on the edge of danger, which requires an urgent “brake”.

A Study of Supervision Performance of China’s Commercial Banks from the Perspective of the Trinity-Characteristics of Banking Supervision System

LV Jiang-lin, HUANG Guang

2014, 0(04):  1627. 

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Based on the theoretical analysis, this paper applies the entropy method to establish a comprehensive index system for the evaluation of the overall level of risk control and comprehensive efficiency of the supervision of China’s commercial banks. Considering the trinity-characteristics of banking supervision system consisting of the people’s Bank of China, the CBRC and the financial offices of local governments, the following conclusions have been drawn: the amount of penalties on banking illegal transactions is not correlated with the supervision efficiency of China’s commercial banks; the capital adequacy ratio, the loan to deposit ratio, the percentage point of the non-performing loan rate of urban commercial banks higher than that of the national joint-stock banks are negatively correlated with the supervision efficiency of China’s commercial banks; the total asset variation of the people’s bank and the different loan balance in local and foreign currency of the banks are positively correlated with the supervision efficiency of China’s commercial banks, but the effect is minor. Therefore, China should give the capital adequacy ratio a full play in the banking supervision, accelerate the construction of supervision information system and improve the supervision function of the local governments.

Evolutionary Logic and Contractual Nature of Endogenous Finance: the Institutional Properties of China’s Private Banks

ZHOU Zhi-fu

2014, 0(04):  1628. 

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The evolution of endogenous finance is an institutional changing process supported by the external institutional environment on the macro level, while on the micro level it is a constantly remodeling and expanding process of the contractual structure, and the endogenous finance has a high degree of contractual intensiveness. In essence, China’s private banks also have the general institutional properties of the endogenous financial institutions. Their development is the inevitable choice of the private economic entities faced with the dual constraints of the credit rationing from the demand side and the financial restraint from the supply side, as well as the inevitable result of the dynamic evolution of China’s overall financial system structure. The evolution logic of China’s private banks fundamentally lies in the separation of financial capital and industrial capital, as well as the rational choice of the financial entrepreneurs through cost- earnings weighing under the incentive structure formed by the inside and outside systems and the cost reducing requirement. The Robust and efficient operation of China’s private banking system needs the promotion of a good development of the inside and outside intermediate structures.

Recognition of Controlling Factors in Low-Carbon Corporate Development: An Empirical Study

DUAN Xiang-yun, CHEN Rui-zhao

2014, 0(04):  1629. 

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To explore the key factors influencing enterprises’ low-carbon development and the recognition of controlling factors is the key to explore the path of low-carbon development. Through correlation and stepwise regression analysis, it is found that the situational factors, such as government and public external pressures, have become the driving factors affecting the enterprises to have environment-friendly low-carbon input behaviors; the low-carbon input of the enterprises is mainly driven by outside forces. While the low-carbon operation is significantly affected by the individual factors of the enterprises, such as low-carbon behavior capacity; the low-carbon operation is mainly driven by the inside forces. The environmental values are significantly correlated with the two kinds of low carbon behaviors. Therefore, we should enhance the enterprises’ environment awareness so as to construct an environmental value that is harmonious with nature, strengthen the cultivation of enterprises’ environment ability and enhance their environmental protection intention, and continue to give active play to the policies and regulations in the enterprises’ low-carbon development.

Promotion of Value Creating Capacity of Agricultural Product Logistic Industry from the Perspective of Resource Development

CHEN Yong-ping

2014, 0(04):  1630. 

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Logistic industry of agricultural products is an important constituent part of the logistic industry. The capacity of value creation of the logistic industry of agricultural products may reflect the level of its development and the benefit. The market competition of the agricultural product logistics is fierce and the requirement for logistic quality is increasing quickly. The organization of the agricultural product logistics relying solely on individual power can no longer satisfy the logistic demands of the production and operation of agricultural products. To expand the resources has become the focus of attention in the operation and development of the logistic industry of agricultural products. On the basis of a connotation qanalysis of the current situation of the farm product logistic industry and its value creating ability, this paper tries to seize the key point to improve the value creating ability of the farm product logistic industry from the perspective of resource expansion and illustrate the resource expansion system for value creating ability of the farm product logistic industry. Through analyzing the path choice to improve the value creating ability, it is possible to help the farm product logictic industry to break through the bottomneck restraining the individual resources, search for the integration and development of the resources, provide quality and effective farm product logistic services, and improve continuously the value creating capacity of the agricultural product logistic industry.

Business Productivity, Product Quality and Choice of Export Destinations: Micro-Level Evidence from China’s Manufacturing Enterprises

LI Fang-jing

2014, 0(04):  1631. 

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By applying the micro-level trade data of China’s manufacturing enterprises during 2005-2006 and from the perspective of heterogeneity in their product quality, this paper studies the relationship between business productivity, product quality and export destination. The results indicate that there is a robust and negative correlation between business productivity, product quality and the proportion of export trade volume in low-income countries. The enterprises with higher productivity can produce products of higher quality easier via increasing R&D investment, so as to meet the preference of higher-income countries for higher-quality products. Thus they are more inclined to export their products to the higher-income countries. The coefficients of the interactive items between the per capita income of export destinations and business productivity, R&D intensity and product quality are significantly positive, which indicate that due to the strong preference of higher-income countries for higher-quality products, export to the destinations with higher per capita income can help enterprises to improve their productivity and product quality. The enterprises that can produce quality products should focus their export on the destination markets with higher income.

Consumptive Network Externalities, Cultural Proximity and Cultural Products Trade: Based on an Empirical Analysis of China’s Bilateral Cultural Products Trade

WANG Ying，HUANG Jian-jun

2014, 0(04):  1632. 

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By making use of the panel data of trade of cultural goods between China and its top 35 trading partners during the period of 2002-2011 and applying the static and dynamic panel gravity models, this paper conducts an empirical study of the decesive factors in China’s cultural products trade on the two levels of the generality and the classfication, especially focusing on the impact brought forward by consumptive network externalities and cultural proximity. The results suggest that the consumptive network externalities of cultural products will promote China’s trade of cultural products through consumer preference spillover and knowledge and culture spillover; while the influence of cultural proximity on the import and export of cultural products varies according to different categories of cultural products. Therefore, an effective way to promote Chinese culture going out is to encourage the innovation and export of the native cultural enterprises through R&D subsidies, to give classfied policy guidence to the export of different cultural products, to actively absorb and imitate excellent foreign cultural achievements, and to promote development with opening-up policy.

Political Connection, Political Connection Costs and Financial Subsidies: An Empirical Study Based on Data from Shenzhen and Shanghai Stock Exchanges

ZHANG Hong-gang, ZHAO Quan-hou

2014, 0(04):  1633. 

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Taking China’s private listed companies during the period of 2006-2011 as the samples, this paper conducts an empirical study of how political connection of private enterprises influencing their cost of maintaining such political connection and how the cost of political connection affecting their obtaining of the financial subsidies, so as to further clarify the internal mechanism of the influence of political connection on the enterprises’ access to government resources. The results indicate that the political connection of private enterprises would indeed bring certain political connection cost, and the higher the degree of connection between the private enterprises and the government, the higher the connection cost would be; while the higher the connection cost is, the more financial subsidies they can gain from the government.

Bank Loans, Corporate Bonds and Earnings Management

BO Lan, WANG Yi-ying, WANG Shu-lin

2014, 0(04):  1634. 

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Different from the previous earnings management studies which focus on the capital market motives in equity financing, this paper discusses the earnings management behaviors based on capital market motives in the debt financing of listed companies. The empirical analysis finds that when the A-share mainboard companies listed in Shanghai and Shenzhen stock markets carried out debt financing during the period of 2007-2011, whether in the form of direct financing by issuing bonds publicly or in the form of indirect financing by obtaining loans from the banks, the generation of new debt would induce the enterprises to make the upward adjustment of the earnings level. Besides, since the supervision efficiency in public debt market is weaker than that of the banks, the way of direct financing in bond issuing would have more significant impact on the enterprises’ earnings control.

A Political Economics Analysis of U.S. Pressure Exerted on RMB Exchange Rate

HAN Hui-chao, XU Kang-ning

2014, 0(04):  1635. 

Asbtract ( 110 )  

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The political economics can provide a new perspective to explain the phenomenon that U.S. exerts pressure frequently on the issue of RMB exchange rate which is hindering the Sino-US trade. An empirical analysis with the Probit model on the U.S. congress bill of The Currency Reform for Fair Trade Act in 2010 illustrates that the political contributions of the interest groups have intensified the congressmen’s tough policy attitude on the RMB exchange rate issue, also the factors such as Sino-US trade impact, industrial structure and population structure of the state from which the congressmen come have influenced the congressmen’s attitude on RMB exchange rate policy. In conclusion, it is the result of the game based on the relationship of interests between the interest groups, congressmen, constituency, etc. that leads to U.S. exerting pressure on the RMB exchange rate issue.