Table of Content

15 July 2014, Volume 0 Issue 07

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Self-Affirmed Demand Surplus: A New Interpretation of the U.S. Financial Crisis

CAI Heng-jin, WU Yi-ping

2014, 0(07):  1699. 

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The global financial crisis triggered by the U.S. subprime mortgage crisis in 2007 also sparked the discussion of the causes of the financial crisis. From the perspective of the self-affirmed demand, this paper conducts an analysis. Its result shows that the individual requirement for self-affirmation will produce excessive demand beyond its rational economic demand, thus a supply gap beyond the social capibility is formed, resulting in the self-affirmed demand surplus. And because there exists a self-affirmed demand, a lot of people overdraft future, which leads to the generation of economic bubbles and eventually leads to the financial crisis. Therefore, the self-affirmed demand surplus is the ultimate cause of the outbreak of financial crisis.

A Study of China’s Total Factor Productivity under Constraints of Resource and Environment

MEI Guo-ping1,2, GAN Jing-yi1,2, ZHU Qing-zhen2

2014, 0(07):  1700. 

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From the perspective of regional spatial correlation, this paper brings the constraints of resource and environment into the analytical framework of TFP to measure the changes of TFP in China’s 29 provinces over the period from 2001 to 2011 and its regional imbalance. On this basis, it constructs the spatial econometric model to make an empirical study of the factors which influence the TFP. The results show that the environmental inefficiency is ubiquitous in these provinces, that under the constraints of resources and environment China’s TFP generally presents a rather significant “growth effect” and spatial imbalance, and that such factors as structure of energy consumption and factor endowments have varying degrees of effect on the TFP growth.

Routine Power, Financial Power and Policy Regulation: A Critical Interpretation of China’s Sports Public Finance

YI Jian-dong, REN Hui-tao

2014, 0(07):  1701. 

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China’s sport finance is transforming towards people’s livelihood orientation, but the sprots authorities have only stipulated the scope of application of financial funds, without paying any attention to the applicability and relevance of policy implementation, thus the malpractice is gradually appearing. Through a comprehensive analysis of the allocation of rights and liabilities of sports public services, the flow of funds and the framework of laws and regulations, this paper believes that the system of sports undertakings has been used to taking competitive sports as the focus of its work and the athletic performance is still the leading indicator to measure the performance of the sports departments. The public welfare fund of Chinese sports lottery is spent too much in other areas of social secutities, the local public welfare fund from sports lottery is hard to reach the grassroot communities. Therefore, it suggests that the use ratio of the public welfare fund from Chinese sports lottery should be extended more to the sports undertakings, that the sports authorities should walk away from the closed and isolated state, and that a cooperative sports public financial system should be gradually formed with well defined powers and responsibilities.

A Research on Structure Optimization of Tax System for the Coordinated Development of China’s Economic Demand Structure

TONG Jin-zhi, HUANG Ke-long

2014, 0(07):  1702. 

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The existing problem of structural imbalance in China’s tax system is intensifying the imbalance situation of China’s economic demand structure. On one hand, the structure of tax system with indirect tax as the main body and the irrational direct tax categories have further twisted the investment and consumption structure; on the other hand, the unreasonable tax burden of income tax on firms and the lagging behind of local tax system construction have also intensified the distortion of the investment structure. In the context of perfecting the macroeconomic regulation and control system and improving the tax system stressed by the Party’s Third Plenary Session of the Eighteenth Central Committee, it is absolutely necessary to improve the optimization of the structure of China’s tax system with the goal of achieving a coordinated development in the economic demand structure, so as to deepen China’s economic system reform. Hence, we should begin with coordinating the structure of direct tax and indirect tax, lay emphasis on the structure optimization of the tax system by raising the household consumption proportion, establishing the dominant role of enterprise investment, and suppressing the investment impulsion of local governments, deepen the reform of all kinds of tax categories, and perfect the system of local taxes, so as to push forward the transformation of China’s economic growth pattern and promote the coordinated development of the economic demand structure.

Debt Financing and Top-Management Compensation: Commitment or Pillage

LUO Hong, LIU Bao-hua

2014, 0(07):  1703. 

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The formal researches hold that when there is financial leverage in a company, the purpose of lowering the executive pay-performance sensitivity by the shareholders is to restrict the risk transfer motivation of the executives and reduce the debt agent costs. We believe that the purpose of this kind of reducing executive pay-performance sensitivity is more likely that the shareholders are taking advantages of the creditors who are bearing the costs of the suboptimum behaviors of the executives when the corporate performance is worse. Based on the data of China’s A-share listed companies during 2007-2012, it can be found that the executive pay-performance sensitivity is negatively correlated with the level of liabilities, while the stickiness of the executive compensation is positively related to the level of liabilities, which suggest that our view is well supported. It is further found that when shareholders are taking advantages of the creditors to bear the costs of the suboptimum behaviors of the executives, they are encouraging executives to transfer risks, thus further expropriate the wealth of the creditors.

An Empirical Study of Mortgage Loan, Social Capital and Farmers’ Loan Availability: Based on Farmers’ Survey Data in Dianbai County

WU Dong-wu

2014, 0(07):  1704. 

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This paper firstly introduces the parameters of social capital and mortgage loan and the social optimal lending model constructed on the basis of Cobb-Douglas function to conduct an analysis. The results show that social capital helps to improve farmers’ availability to loans. Secondly, from the perspectives of the three groups, i.e., all the people, the medium to high-income group and the low-income group, it conducts an empirical analysis of the data from the farmers’ survey with the Logistic model. The result shows that from the perspective of all the people, farmers are generally lacking eligible collateral; the mortgage loans have reduced the availability of loans to farmers in general while social capital can increase the size of loans in rural areas. From the perspective of the medium to high-income group, the richer farmers are generally able to provide collateral, which helps to raise lending availability. From the perspective of the low-income group, banks are more concerned about the social capital of the farmers, and the function of social capital in loans is bigger than the mortgage; social capital is positively correlated with loan availability. At present, the low-income groups are in the majority in China’s rural areas, to introduce social capital into the farmers’ loan agreements can help farmers to solve the problem of loan difficulty.

On the Influence of Coping Strategies of Competing Brands on the Negative Spillover Effect from Product Harm Crisis

WANG Jue, FANG Zheng, LI Wei

2014, 0(07):  1705. 

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The ngative spillover effects from pruduct harm crisis are widespread. Then how to prevent or reduce the indirect effects from the focused brands? The results of the empirical analysis indicate that as far as the negative spillover of the competing brands in response to the product harm crisis is concerned, segmentation strategy is the best, and there is no significant difference between denial strategy and silence strategy. Compared with the high brand-commitment consumers, the product harm crisis can easily produce negative sillover effects on the low commitment consumers. With the increase of commitment level of the consumers, the impcat on reducement of negative spillover effects from crisis response of competing brands increases. These findings can offer some enlightment to them to respond actively to the negative spillover effects from product harm crisis.

A Study of Customers-Employee Negative Emotional Contagion Mechanism

ZHAN Xiao-jun

2014, 0(07):  1706. 

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Due to the asymmetry of power between customers and employees, the majority of customers would end their service interactions with negative emotion in order to report or resolve the problems. On the basis of cognitive appraisal theory of emotion and resource conservation theory, this paper collects and refers to the related literatures and makes a survey on 348 paired customers and employees by adopting the questionnaire method, so as to investigate the mechanism of customer-employee negative emotional contagion. The result shows that the customer negative emotion can influence the employees’ emotional work through their perceived customer justice. The collectivism tendency of the employees and the service atmosphere around the organization can alleviate the impact of customers’ negative emotion on employee-perceived customer justice. In addition, based on the discussion about the research result, it puts forward some suggestions for service enterprises to prevent and deal with customers’ negative emotion.

China’s Anti-Dumping Motives: An Empirical Study Based on Counting Panel Model

LIANG Jun-wei, WANG Zhong-hua

2014, 0(07):  1707. 

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While being frequently encountered with anti-dumping lawsuits in the world, China is also initiating anti-dumping proceedings against its trade partners by actively making use of WTO rules. The anti-dumping proceedings and the number of lawsuits placed on record or being enforced can reflect the complexity of the bilateral relations between China and its trading partners. Through the negative binomial panel test, it can be confirmed that the domestic economic situation and market stability is the primary factor affecting China’s anti-dumping activities, while the anti-dumping proceedings initiated by China is closely related to the number of anti-dumping charges it received. The relevance varies according to the anti-dumping tradition of the trade body: as for anti-dumping “club” members, China has both the intention of retaliation and the concern of being retaliated; as for non-club members, China’s action is mainly based on the considerations of domestic industrial security and market stability. Because the litigation process has a significant “trade investigation effect”, its retaliatory desire is usually stronger than the anti-dumping measures being implemented. On the whole, China is experiencing the adaptation process of “learning from frictions”, and is becoming more mature to master and use international conventions and trade regulation under the WTO framework.

A Study of the Effects of CAFTA on China’s Exporting Duration

LIN Chang-qing, ZHANG Xiang-wen

2014, 0(07):  1708. 

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By employing the K-M method, this paper estimates the survival time and survival rate of China’s export trade products and the classfied products. Meanwhile, it adopts the discrete time probit, logit, cloglog models to study the effect of CAFTA on China’s export trade duration, and then it tests the effect in terms of the returns to scale and the degrees of differentiation. The results show that the median value and the mean value of China’s export time duration are rather shorter. The member country effect of CAFTA is in the opposite direction to the establishment effect; however, both the effects are significant and then have passed the robustness test. The member country effect of different classfied products is different from the significance of the establishment effect, and the directions of the final gross effect are also inconsistent. Therefore, we should pay close attention to the free trade area effects of export duration and the different effects of all kinds of classfied products when adjusting the export trade policy.

On Several Theoretical Issues Concerning Corporate Performance Evaluation in Strategic Emerging Industries from the Perspective of Evolution

ZHANG Rui

2014, 0(07):  1709. 

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The business objective of the enterprises in the strategic emerging industries should be defined as: on the premise of following the “3R” principle of circular economy development, taking the related policies of the State Council concerning energetic development of China’s strategic emerging industries as the guiding ideology, keeping the breakthroughs of the significant technology and the formation and maintaince of the core technology as the kernel, pursuing the high growth capacity and development potential of the enterprises, so as to achieve sustainable corporate value maximization, and truly realize the leading and guiding role of the business operation of strategic emerging industries in the development of regional economy or national economy. To match this objective, enterprises should establish a new management philosophy, i.e., a new efficiency concept, a new innovation concept and a new interest concept. The performance evaluation should be based on the “maximum”and“minimum”laws, the circular economy theory, the strategic management theory, and the stage theory of economic growth. At the same time, it is necessary to keep to the principles in performance evaluation, such as relevance, comprehensiveness, importance, the will of the state, the cost-effectiveness, and so on.

On the Motivations and Determinants of the Selection of Investment Property Measurement Mode: Empirical Evidence from China’s A-Share Market

ZHANG Rui-li, QU Xiao-hui, ZHANG Guo-hua

2014, 0(07):  1710. 

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Taking the A-share listed firms holding investment properties during 2007-2012 as the samples, this paper empirically tests the motivations and determinants of the selection of measurement models for investment property by China’s listed firms. It tries to interpret the quality and function of financial information from one aspect. The results indicate that the non-state-owned firms with higher asset-liability ratio, higher level of managerial share ownership and higher ratio of investment property tend to choose fair value measurement model, while such factors as management’s monetary compensation, earnings smoothness, capital market regulation and the activity level of real estate markets have no significant effects on the choice of measurement model for investment property.