Table of Content

15 July 2021, Volume 0 Issue 7

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Theoretical Economics

On Xi Jinping’s Major Theoretical Innovation on Economic Development

Jiangxi Research Center for the Socialist Theoretical System with Chinese Characteristics

2021, 0(7):  3-12. 

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In the face of the major changes of social principal contradictions in the new era and the complex changes taking place in domestic and foreign environment, in order to promote a more sustainable and healthy development of the socialist economy with Chinese characteristics, Xi Jinping has pushed forward theoretical innovations, formed the Xi Jinping’s economic thought on socialism with Chinese characteristics for the new era, and realized the major theoretical innovation for Marxist political economy. This major theoretical innovation includes the distinctive development theme of high-quality development, the scientific guiding ideology of new development philosophy, and the strategic choice of new development pattern. As important concepts to understand Xi Jinping’s economic thought on socialism with Chinese characteristics for the new era, the high-quality development, the new development philosophy and the new development pattern constitute the policy basis for promoting China’s economic development at the new stage and in the new era. These three theoretical innovations, i.e., with the new development philosophy as the value guide, smoothing the domestic and international dual circulation, and helping the high-quality economic development, constitute an organic integrity, which has enriched the Marxist concept of development and promoted the innovative development of Marxist political economy in the 21st century.

Rapid Urbanization and Social Trust: An Empirical Study Based on the Data of Chinese General Social Survey

ZENG Xi-ling, LIU Zhi-ming

2021, 0(7):  13-23. 

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Urbanization is an inevitable law of economic and social development, but rapid urbanization may bring about many negative effects, one of the possible negative effects is the decline in social trust. Urbanization will break the original social network, trigger the resource competition, increase the uncertainty of the external environment, and cause the exclusion of new immigrants by the original residents. All of these may aggravate social conflicts and worsen social trust. The findings of the research based on the data from the Chinese General Social Survey (CGSS) show that the level of social trust decreases significantly with the increase in the speed of urbanization, especially, rapid urbanization will significantly reduce the level of social trust. In view of the fact that the decline in social trust will lead to many major negative effects, it is very necessary for the government departments to pay attention to this issue in the process of rapid urbanization.

Public Economics & Administration

How to Achieve High-Quality Economic Development under Fiscal Imbalance: An Analysis of Local Government Behaviors Motivated by the Central Government

WANG Xin-liang, LIU Fei

2021, 0(7):  24-37. 

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This paper constructs a dynamic panel model and uses the SYS-GMM estimation method for this study. The findings show that there is an inverted“U-shaped”relationship between financial vertical imbalance and economic development quality, and that the local government investments and regulation behavior bias are the reasons for the loss of development quality caused by excessive vertical fiscal imbalance. Under the vertical imbalance of moderate finance, the central finance and political incentives have a similar marginal effect on the high-quality economic development; however, if the vertical imbalance is excessive, the inhibitory effect of political incentives on the loss of economic development quality will be stronger than that of financial incentives. The horizontal fiscal imbalance will constrain the relationship between vertical imbalance and the quality of economic development, resulting in the shrinking of the moderate threshold value of vertical imbalance in areas with higher horizontal imbalance, and the enlarging of the moderate threshold value in areas with lower horizontal imbalance. With the differences of horizontal imbalances, there is regional heterogeneity in the active function between central finance and political incentives. In areas with higher horizontal imbalance, single political incentives or political incentives combined with transfer payments can play a stronger role, while in areas with lower horizontal imbalance, the tax decentralization in the single financial incentives is better than political incentives or other strategies. Therefore, it is suggested that such measures as increasing local financial support, implementing differentiated fiscal and taxation policies, optimizing the promotion incentive indexes and so on should be adopted, so as to reduce the degree of fiscal imbalances in accordance with local conditions, reverse the behavior bias of local governments, and promote the high-quality economic development.

Will Vertical Fiscal Imbalance Affect the Efficiency of Local Government Expenditure?

LIU Shu-xin, YANG Sen-peng

2021, 0(7):  38-50. 

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At present, it is more difficult to increase revenue and reduce expenditure for local finance. It is of practical significance to identify the exact relationship between vertical fiscal imbalance and efficiency of local government expenditure. Under the background of Chinese institutions, this paper brings the vertical fiscal imbalance and efficiency of local government expenditure into the same theoretical analysis framework and deduces the function that the vertical fiscal imbalance exerts the effect of“pushing up”and“pulling down”on the efficiency of local government expenditure. The findings of the empirical study show that, at present, China’s vertical fiscal imbalance will generally promote the efficiency of local government expenditure. Although there exists the central transfer payment mechanism, the vertical fiscal imbalance still aggravates the fiscal pressure of local governments and strengthens the pushing-up effect on the efficiency of local government expenditure. The intensity of this effect is also heterogeneous due to the different functional attributes of fiscal expenditure, which shows that the expenditure efficiency of science, education and other expenditures with certain production attributes is easily affected, while the efficiency of medical and health expenditure with almost pure welfare attributes is not significantly affected. Therefore, in the reform process of properly correcting the fiscal system of vertical imbalance, attention should be paid to the comprehensive implementation of the performance budget management system, increase of the strength of fiscal information disclosure, reasonable improvement of the assessment system for local governments and officials, and effective optimization of the central transfer payment mechanism.

Modern Finance

Population Aggregation and Financial Fragility: An Empirical Study Based on Listed Banks in China

DENG Ke-bin, KUANG Peng-cheng

2021, 0(7):  51-64. 

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Population aggregation can exert a certain degree of potential external shock to the stability of finance, which may lead to exposure of the fragility in the financial system. By selecting the micro-data of China’s listed banks and the city population density data from 2000 to 2019, this paper conducts an empirical test on the affecting direction of population aggregation on financial fragility and its action mechanism. The findings show that population aggregation can significantly lead to banks’ default risks and the rising of systemic risks, i.e., population aggregation has aggravated the financial fragility. While during the banking panic period and in the bank group with lower information asymmetry, the effect of population aggregation on banking risks is even stronger. This reveals that population aggregation can not only result in the increase of bank risks by intensifying financial panic, but also reducing bank risks by alleviating information asymmetry. Further analysis reveals that the population aggregation driven by the reform of the household registration system in 2014 has significantly raised the leverage ratio and loan-to-deposit ratio of regional commercial banks, which further contributed to the increasing of bank risks. This proves that the negative impact of population aggregation on financial stability exists solidly. Therefore, it is necessary to pay attention to the regional coordinated development and avoid excessive population aggregation; to boost public confidence and to prevent and control financial risks in the areas with dense population; and to focus on strengthening the supervision of the banking industry and to safeguard the safety and stability of the whole financial system.

Financial Technology and Enterprises Shifting from the Real to the Virtual: Evidences from China’s A-Share Listed Companies

XIN Da-leng

2021, 0(7):  65-76. 

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Financial technology is of vital importance to the promotion of the high-quality development of enterprises. Based on the data of China’s A-share listed companies, this paper comprehensively explores the impact of financial technology on enterprises’“shifting from the real to the virtual”. The results show that the development of financial technology has significantly inhibited enterprises’ “shifting from the real to the virtual”. The mechanism test shows that financial technology has influenced enterprises’ behavior of “shifting from the real to the virtual” through two channels: competition effect and cost effect. Financial technology has reduced the rate of return of corporate investment in financial assets and the management costs of corporate financial, which has promoted corporate investment in the real economy and inhibited the enterprises’ “shifting from the real to the virtual”. In addition, compared with state-owned enterprises, enterprises in the central and western regions, and enterprises located in the regions with a lower degree of marketization, the inhibiting effect of financial technology on the“shifting from the real to the virtual” of the non-state-owned enterprises, enterprises in the eastern region, and enterprises in the regions with a higher degree of marketization enterprises is much more significant. Moreover, the development of financial technology has mainly restrained the investment of enterprises in speculative financial assets, but the impact on the investment of enterprises in value-preserving financial assets is not obvious. Therefore, it is necessary to continuously increase the support for financial technology, let big data, artificial intelligence and other technologies play an active role in supporting the financial technology. And at the same time, give certain policy preferences to the central and western regions, so as to continuously enhance the enabling effect of financial technology to the real economy.

Business Adminsratio.

Information Transparency and Corporate Technology Innovation: Evidences from China’s Listed Companies

WANG Ke-di

2021, 0(7):  77-89. 

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By making use of the patent citation data of listed companies, this paper empirically test the impact of information transparency on corporate innovation. The findings show that information transparency can boost corporate innovation in China. And this conclusion remains valid when instrumental variables are used to control the endogeneity. The findings of further analysis show that the innovation promotion effect of information transparency is achieved mainly through easing the constraints on innovative financing, rather than through giving full play to the governance. It can be seen that to relieve the restriction on corporate innovation financing is the main channel for information transparency to promote innovation. Meanwhile, the improvement of information transparency has increased the management’s attention to the short-term performance and brought about information leakage risks, which has weakened the promotion effect of information transparency on corporate innovation to some extent.

State-Owned Equity and Strategic Risk-Taking of Private Enterprises: From the Dual Perspective of“Ability”and“Willingness”

CHEN Ming, XIONG Xian-cheng

2021, 0(7):  90-102. 

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From the dual perspectives of“ability”and“willingness”, this paper conducts an empirical study by making use of the data of Chinese private listed companies from 2012 to 2018. The findings show that with the increasing number of state-owned shares, the level of strategic risk-taking of private companies presents a tendency of first increasing then decreasing. After a series of robustness and endogeneity tests, the conclusion is still stable. When the multiple mediating effect model is used to test, the results show that the state-owned equity not only can make private enterprises possess the“ability”of taking strategic risks by alleviating financing constraints, but also can improve their“willingness”to take strategic risks by reducing the principal-agent level. The results of further research show that although reducing the principal-agent level can play a certain role in promoting the level of risk-taking, it is mainly through relieving financing constraints that the state-owned equity can improve the level of strategic risk-taking of private enterprises. Moreover, this promoting effect is much more significant in the industries with high potentials or stronger background of state-owned shareholders’ control. In the provinces with lower marketization level, the state-owned equity can be seen as an alternative to the market mechanism, and it can play a more significant role in improving the level of strategic risk-taking of private enterprises.

Industry & Trade

The Impact of Cultural Approximation on the Bilateral Trade of Countries along the“Belt and Road”Route under Boundary Conditions

WANG Ying

2021, 0(7):  103-113. 

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Based on a multi-level modeling method, this paper makes use of the 2008-2017 bilateral six-quantile product trade data of the countries along the“Belt and Road”route to study the impact of cultural approximation on the bilateral trade of the countries along the“Belt and Road”route and the boundary effect between the “Belt and Road” initiative and the culture division of the importing countries. The findings show that because cultural approximation reduces the uncertainty of bilateral trade, the higher the degree of cultural approximation among the countries along the“Belt and Road”route, the greater the bilateral trade volume will be. The positive regional institutional environment created by the“Belt and Road”initiative will strengthen the promotion of cultural proximity to the bilateral trade of countries along the“Belt and Road”route; however, the cultural division of importing countries will weaken the promotion effect of cultural proximity on the bilateral trade of countries along the“Belt and Road”route. The research findings of this paper will help to understand the impact of cultural approximation on international trade and its boundary conditions, then providing effective policy recommendations for the continuous and in-depth implementation of the “Belt and Road”initiative from a cultural perspective.

Local Governments’ Autonomous Restraint Behavior and Enterprise Pollution Reduction under the Background of Green Performance Evaluation

PANG Rui-zhi, LIN Ting, WANG Qun-yong

2021, 0(7):  114-126. 

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Green development is an important part of high-quality development. Based on the exogenous impact of incorporating environmental performance into the official performance appraisal, this paper has manually collected and sorted out the index data of environmental target constraint disclosed in the government work reports of 285 cities. On this basis, it further conducts a cross-database matching between China Industrial Enterprise Pollution Discharge Database and China Industrial Enterprise Database from 1998 to 2012, so as to obtain comprehensive data of enterprises and local governments’ environmental protection indicators. Then it adopts the DID method to test the impact of local governments’ environmental target constraints on the pollution emissions of enterprises located in the areas under administration. The findings show that the autonomous restraint behavior of local governments under the green performance evaluation system has effectively promoted the pollution reduction of enterprises and reduced the chemical oxygen demand emissions of enterprises by 9.0%. Local governments have effectively promoted environment governance in their jurisdictions through environmental regulation and environmental protection subsidies, and enterprises have achieved emission reduction and pollution control mainly through source control and technical effects. The results of heterogeneity analysis show that the enterprises in the eastern region or with heavy pollution have achieved more pollution reduction. In addition, officials promoted locally have achieved more significant environmental governance due to their geographical advantages, and young officials have greatly reduced the pollution emissions of enterprises in their jurisdictions under the strong incentive of promotion.

Modern Accounting

Classified Reform of State-Owned Enterprises’ Mixed-Ownership and Capital Allocation Efficiency

JIANG Xu-han

2021, 0(7):  127-137. 

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The classified reform of the mixed ownership is one of the important reform strategies in China’s state-owned enterprises. Taking the state-owned listing companies during the period of 2003-2018 as research objectives, this paper empirically tests the impact of the classified reform of mixed-ownership on capital allocation efficiency. The results show that, in the“fully competitive”state-owned enterprises（SOEs）, the mixed equity restriction can significantly restrain over-investment and improve capital allocation efficiency, while in the SOEs belonging to the“important industry category”, this effect is not significant. The results of further study show that in the state-owned enterprises in the“fully competitive category”, compared with the shareholders of other nature, private shareholders can play a more significant role in the restriction of over-investment, and can better improve capital allocation efficiency. Compared with SOEs in the“resource monopoly category”, the mixed equity restriction of SOEs in the“general competitive category” can significantly restrain over-investment and improve capital allocation efficiency.

“Joseph Schumpeter Trap”and Its Surmounting: Reconstructing the Interactive Symbiotic Relationship between Accounting and Economics

MIAO Yan-juan, YANG Xiong-sheng

2021, 0(7):  138-148. 

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“Joseph Schumpeter Trap”refers to the disappearance of innovation impetus. How to surmount“Joseph Schumpeter Trap”is a puzzle to be solved urgently during the process of the development of modern society and economy. On the basis of focusing on M&A accounting changes and the lessons learned and analyzing the reality of social and economic development in the 20th century, this paper reveals the background of the accounting system formed by Joseph Schumpeter innovation and the Joseph Schumpeter Trap. It holds that a feasible choice to astride“Joseph Schumpeter Trap”is to perfect the M&A goodwill accounting system, making it truly reflect a healthy interactive and symbiotic relationship between accounting and economics, so as to ensure the unity of value creation and real economy development.