Table of Content

15 October 2023, Volume 0 Issue 10

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Theoretical Economics

The Historical Evolution, Effect and Experience of Promoting Modernization in a Chinese Way through National Planning

REN Bao-ping, XIN Wei

2023, 0(10):  3-15. 

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National planning is an effective means to promote Chinese modernization, and its evolution provides support and impetus for subsequent planning in both theory and practice. The 14 Five-Year plans implemented since the founding of the People’s Republic of China have played an important role in the process of the Chinese path to modernization. These plans promote Chinese modernization through three mechanisms: the first is to clarify the modernization development goals with specific tasks which arecontinuously and dynamically adjusted; the second is to guide the regional modernization development through the optimization of resource allocation and industrial layout; the third is to clarify the development ideas to ensure the steady and long-term progress on the path of modernization.The role of national planning in promoting the realization of Chinese modernization is quite obvious, and the ability of national planning promoting Chinese modernization is constantly enhanced. The experience of promoting Chinese modernization with national planning lies in adhering to the CCP’s leadership in the formulation of the planning of Chinese modernization, so as to prevent potential risks with full investigation, to determine effective targets with realistic orientation, and to provide error correction mechanism with the two-stage evaluation. On the basis of summarizing the experiences of promoting Chinese path to modernization through national planning, the 14th Five-Year Plan and the future national planning of Chinese modernization need to adhere to the basic position of socialist market economy, coordinate the relationship between macro-control and market development, stick to the high quality development to promote the new journey of Chinese modernization, and promote the transformation of service-oriented government with government positioning and function transformation.

Has China’s Industrial Structure Change Narrowed the Regional Economic Gap?

LIU Jin-quan, XUE Wei-wen

2023, 0(10):  18-29. 

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The coordinated development of regional economy is an important practical problem that China is faced with in the process of building a modern economic system, and it is also the only way to achieve common prosperity. Since the 21st century, the economic growth of China has shown a converging trend of first fast then slow around the node of the year of 2013. Based on the three-sector Mankiw-Romer-Weil extended convergence model including the industrial structure changes, this paper conducts an empirical study. The findings show that industrial structure changes can promote inter-provincial economic convergence as a whole, but there is industrial heterogeneity.The labor inflow into industry has a significant positive effect on the convergence in the short term, while the inflow into the service industry is difficult to promote convergence. Further research shows that from 1998 to 2013, compared with the industrial structure change in the eastern region, which is dominated by the inflow of agricultural labor into the service industry, the industrial structure change in the central and western regions, which is dominated by the inflow of agricultural labor into the industry, has a stronger role in promoting economic growth, thereby narrowing the economic gap between the central and western regions and the eastern regions, and accelerating China’s overall economic convergence; however, after 2013, the industrial structure of the central and western regions has gradually synchronized with the eastern region, both of which are dominated by the inflow of agricultural labor into the service industry, and the inter-provincial economic convergence rate is slowing down.

Public Economics & Administration

Research on the Impact Path of Tax Reduction Policy on the Digital Transformation of Enterprises: From the Perspective of VAT Rate Reduction

LU Xiao-qi, YU Mao-mao

2023, 0(10):  30-43. 

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High quality development is the important support for building Chinese path to modernization, and enterprise digital transformation is an important driving force for China’s high-quality economic development, while alleviating firms’ cost burden during the digital transformation processthrough tax and fee reduction is the key of the policy support. Taking the VAT rate reduction policy issued in May of 2018 as an entry point, this paper uses the sample data of A-share listed companies in China’s Shanghai and Shenzhen stock markets from 2016 to 2020 to conduct an empirical analysis of the impact of the tax reduction policy on enterprises’ digital transformation and the action mechanism. The results show that the implementation of the VAT rate reduction policy could promote the digital transformation of enterprises significantly, but the policy effect of the VAT rate reduction is not significant in the year of 2018 and the prior years, while in the yearsof 2019 and 2020 it is more significant.In terms of the specific mechanism, the VAT rate reduction can promote the digital transformation of enterprises through the intervening mechanism of easing firms’ financing constraints on one hand, on the other hand, it can promote the digital transformation of enterprises through the intervening mechanism of increasing the proportion of fixed asset investment. In the future, it is necessary to further optimize the VAT rate reduction policy system, implement and put into effect of the related and detailed policies, reduce the cost burden of the enterprises during the process of digital transformation through tax reduction policies, and enhance enterprises’ long-term business confidence, so as to promote the digital transformation of the enterprises.

Tax Reduction Incentives and Corporate Performance in ESG: A Quasi-Natural Experiment Based on China’s VAT Credit Refund

YU Jing-yuan, ZHAO He-yun, ZHU Cui-hua

2023, 0(10):  44-57. 

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The VAT credit refund is a important measure for the reconstruction of tax neutrality and the promotion of the tax governancemodernization, and it is of great significance for the improvement of the enterprises’ performance in environment, society and governance (ESG). Based on the document of No.70 Caishui (2018) and making use of the data of A-share listed companies in China from 2011 to 2021, this paper conducts an empirical study of the spillover effects of corporate ESG of VAT credit refunds and its action mechanism. The findings show that the implementation of the VAT refunds policy has significantly improved the ESG performance of the pilot enterprises, which is conductive to the green and sustainable development of enterprises. The mechanism analysis reveals that the refund policy has improved the ESG performance of enterprises by easing the financing constraints of the pilot enterprises and stimulating their green energy conversion. This suggests that the VAT credit refund policy can not only provide relief to enterprises but also has a spillover effect in promoting their green transformation and development. The heterogeneity analysis further reveals that the green incentive effect of VAT credit refunds is more prominent in the non-state-owned enterprises and the enterprises with a higher burden of tax retention at the end of the period. Therefore, it is recommended to utilize multi-policy combinations to gather the joint forces and continuously enhance the ability of enterprises to develop in a green and sustainable manner, utilize the multi-tax governance to improve policy synergy degree and fully unleash the effectiveness of combined tax cuts and fee reductions, and continue to deepen the VAT reform, so as to further improve the matching and adaptability of the policy.

Modern Finance

Stock Issuance Registration System Reform, Investor Sentiment and IPO Underpricing

LI Ke, LIN Ya-jia, QI Bao

2023, 0(10):  58-71. 

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With the comprehensive implementation of the registration system reform, how the reform of the issuing system and the trading system affects IPO stock pricing has become the focus of attention. Taking the reform of GEM registration system as a quasi-natural experiment, this paper constructs a DID model to explore the impact of investor sentiment on IPO stock pricing. The findings show that, compared with the approved main board market, investors are more enthusiastic to participate in the subscription of IPO stocks of registered GEM, and the investor sentiment can aggravate the underpricing of the registered GEM IPO stocks. Meanwhile, compared with the main board market, the IPO stock of the registered GEM presents more information contents, which proves that the changes of IPO underpricing after the reform of the registration system cannot be explained by information asymmetry. Further analysis shows that the registered GEM IPO stocks exhibit a more significant long-term reversal when investor sentiment drives up short-term stock valuations. Stocks with higher analyst attention, higher optimism, and wider divergent opinions are more affected by the registration system for IPO underpricing. The science and technology innovation board stocks with a more rational investor structure do not show a higher investor sentiment and IPO underpricing, which indicates that investor sentiment would affect the IPO pricing of the GEM. The above conclusion means that in the process of registration system reform, the government, enterprises, and investors not only need to understand the disclosure of relevant information of listed companies, but also need to closely monitor the emotional changes of stock investors, so as to promote the stable development of the capital market and the real economy.

Will Securities Margin Trading Affect Corporate Share Repurchase?

LI Li, HE Wei-feng

2023, 0(10):  72-84. 

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The number of times and the scale of share repurchases in the Chinese capital markets have multiplied ever since the amended Company Law of 2018 loosened the limits on corporate share repurchases.Share repurchase have become an important financial activity of the companies. As an important institutional reform in China’s capital market, securities margin trading has brought changes to the trading mode of the capital market; will these changes affect the corporate share repurchase behaviors? This is a topic that deserves attention. Taking China’s A-share listed companies from 2007 to 2021 as research samples, this paper adopts the multi-time point difference-in-difference model to empirically test the influence of the margin trading system on corporate share repurchase. The findings show that securities margin trading has a significant promoting effect on corporate share repurchase behaviors. Specifically, after the implementation of the margin trading system, the share repurchase scale of the target company for margin trading is significantly larger than that of other listed companies. The heterogeneity analysis reveals that the promoting effect of margin trading on share repurchase has a significant impact on the companies with low stock liquidity, the companies with non-state-owned property rights, the companies located in areas with lower degree of marketization, and the companies with bear market trends. Therefore, the regulatory authorities should further encourage and guide companies involved in margin trading to implement share repurchases, the policy makers should adjust the restrictions on share repurchases based on the different risk characteristics of the company, and the listed companies should make good use of share repurchases as a kind of risk management tool.

Business Administration

Can Digitalization of Enterprises Enhance“Less Talk More Action”in Their Environmental Liability?

DUAN Rui-kun, DUAN Yong-jia, LIU Yi

2023, 0(10):  85-96. 

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In the context of digital economics, responsible digitalization practised by enterprises is an important path to promote the development of science and technology in the right direction and to achieve compatibility between digital transformation and green development. The fulfillment of corporate environmental responsibility is often plagued by issues such as“too much talk and too little action”, “drifting green”, and“decoupling”. Based on the micro data of A-share listed companies from 2011 to 2019, this paper explores the impact of corporate digitalization level on corporate environmental responsibility of “less talk and more action”and its boundary conditions. The findings indicate that the digitalization level has a significant promoting effect on corporate environmental responsibility in a“less talk and more action”way.Under high environmental pressure, the level of digitalization has a stronger promoting effect on corporate environmental responsibility of“speaking less and doing more”. When enterprises face higher financing constraints, the promotion effect of digitalization on their environmental responsibility of“speaking less”is weaker. The promotion effect of digitalization level on“less talk”mainly affects the low-quality disclosure of enterprise environmental information rather than high-quality disclosure. The promotion effect of digital level on corporate environmental responsibility will not sacrifice the financial performance of the enterprise. The above research conclusions reveal the close connection between enterprise digitization and enterprise green development, providing important insights for achieving the two major social goals of digital transformation and green development.

The Impact of Dual Performance Feedback on Internationalization Speed of Firms

WU Jian-zu, JIN Ao

2023, 0(10):  97-108. 

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The existing researches mainly focus on the impact of performance feedback based on a single expected goal from the perspective of corporate behavior theory, neglecting the dual performance feedback effects based on historical and social expectations, as well as the self-serving motivation of managers. Based on the theory of corporate behavior and theself-serving motivation of managers, this paper infers that the dual performance feedback changes the speed of enterprise internationalization by influencing the motivation and intensity of their rapid internationalization. This paper conducts an empirical study with A-share manufacturing listed companies from 2009 to 2018 as research objects. The findings show that under the mutual influence of consistent historical and social performance feedback, the internationalization speed of enterprises accelerates. On the one hand, the dual negative feedback has led to an increase in the intensity of problem search among managers, viewing the rapid internationalization as a solution to problems, thereby forming a rapid internationalization motivation of“poverty leads to change” on the other hand, the dual positive feedback promotes the improvement of managers’ self-efficacy, viewing the rapid internationalization as a means to achieve sustained growth, thereby forming a rapid internationalization motivation of“being rich and more ambitious”. Under the interactive influence of inconsistent historical performance feedback and social performance feedback, the driving forces of“poverty leads to change”and“wealth leads to progress”both decrease in intensity, and the internationalization speed of enterprises slows down. Therefore, in international strategic decision-making, focusing on the reference role provided by the dual performance feedback and the interactive impact of manager problem search and self service can help enterprises to better cope with the risks and opportunities of internationalization.

Industry & Trade

Digital Economy, Regional Local Administrative Monopoly and Industrial Over-Isomorphism

YU Liang-chun, GONG Yuan-yuan

2023, 0(10):  109-120. 

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The digital economy is of great significance in driving the restructuring of industrial systems andthe shifting paradigms, as well as building a unified market. Based on a heterogeneous enterprise model, this paper constructs an inter provincial sales model within a closed economy under the digital economy to explore the changes in production costs and the changes of the degree of regional administrative monopolies brought about by the development of the digital economy, as well as their impact on the excessive industrial homogenization. The spatial spillover effects of this impact is also analyzed. The theoretical hypothesis is empirically tested by using the measured data of the degree of industrial homogenization and the degree of digital economy development in 29 provinces from 2011 to 2020. The findings show that the development of the digital economy can effectively reduce the problem of excessive industrial homogenization. In the eastern region, the areas with higher levels of digital economy innovation and lower levels of marketization, the role of digital economy development in reducing industrial homogenization is more significant. The development of digital economy in the adjacent areas can reduce the degree of industrial homogenization in the local area. The development of the digital economy can reduce the degree of industrial homogenization by reducing production costs and the degree of regional administrative monopolies.

Does the Green Credit Policy Affect the Global Value Chain Climbing of Chinese Enterprises?

ZHANG Qing, YU Jin-ping

2023, 0(10):  121-132. 

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The green credit policy re-configures credit resources, promotes the green transformation of high polluting and high-energy consuming enterprises, and provides new ideas for promoting the high-end climb of the global value chain of enterprises. By combining the data from the Green Development Enterprise Database, China Industrial Enterprise Database, and the Customs Trade Database, this paper takes the implementation of green credit policies in 2007 as a quasi natural experiment to examine the impact of green credit policies on the division of labor in the global value chain of enterprises. The findings show that the implementation of China’s green credit policy has significantly enhanced the status of China’s enterprises in the division of labor in the global value chain. The mechanism test reveals that the productivity effects and the intermediate substitution effects are important mechanisms by which the implementation of green credit policies affects the division of labor status of enterprises in the global value chain. Further research has found that the stronger a company’s dependence on polluting intermediate goods, the smaller the effect of green credit policies on enhancing the division of labor in the global value chain of the company. The strength of the implementation of regional environmental protection policies helps to strengthen the enhancement effect of green credit policies on the division of labor status of enterprises in the global value chain. Therefore, it is of great importance to refine the environmental risk assessment standards and the green credit policy guidance catalogs, improve the supporting measures for enterprise innovation incentives, crack the financial and technological barriers, enhance the implementation of the environmental protecting policies, alleviate the problem of information asymmetry in the green credit policies, and give full play to the green credit policies in upgradingthe division of labor status of enterprises in the global value chain.

Modern Accounting

A Study of the Governance of the Decoupling of Social Credit System Construction from Corporate Social Responsibilities

HUANG Si-qi, MAI Yong, YAN Jing-rui

2023, 0(10):  133-144. 

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Does the construction of a social credit system have a governance effect on the decoupling of corporate social responsibility? The existing researches paid little attention to it. By making use of the pilot policy of China’s social credit system reform and the data from A-share listed companies in Shanghai and Shenzhen stock exchanges from 2010 to 2020, this paper examines the impact of the reform pilot of social credit system on corporate social responsibility decoupling with the dual difference method. The findings show that the pilot reform of the social credit system can significantly improve the decoupling of corporate social responsibility. Further research reveals that the pilot reform of the social credit system can enhance regional trust, improve enterprise information transparency, and suppress managers’ short-sighted behaviors, thereby improving the decoupling of corporate social responsibility. The heterogeneity analysis shows that in the enterprises with lower internal governance quality and those in the socially responsible sensitive industries, the pilot reform of the social credit system has a more significant governance effect on the decoupling of corporate social responsibility. The economic consequence analysis reveals that the pilot reform of the social credit system has improved the decoupling of corporate social responsibility, reduced corporate financial risks, and helped to enhance corporate values. Therefore, it is necessary to continue to deepen the construction of the social credit system and guide managers to focus on sustainable development of enterprises.

The Carbon Reduction Effect of Off-Office Audit of Natural Resource Assets for Leading Officials

TAN Zhi-dong

2023, 0(10):  145-156. 

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The departure audit of natural resource assets for leading officials has a positive effect on pollution control, however, whether it has a carbon reduction effect remains to be verified. Taking the data from the prefecture level cities from 2012 to 2019 as samples, this paper examines the impact of natural resource asset retirement audits for leading officials on regional carbon emissions with a multi-phase double difference model. The findings show that off-office auditing of natural resource assets for leading cadres can significantly suppress regional carbon emissions. The mechanism analysis shows that the departure audit of natural resource assets for leading cadres can promote green technology progress and industrial structure upgrading, thereby suppressing regional carbon emissions. The heterogeneity analysis reveals that in the regions with higher industrial carbon emissions, the regions with less abundant carbon sink resources, and the regions with higher levels of local government attention, the carbon emission reduction effect of the natural resource asset off-office audits for leaders is more significant. The extensive analysis shows that carbon market pilot projects can enhance the carbon emission reduction effect of off-office audits; the stronger the public’s awareness of green and low-carbon, the more effective it is to enhance the carbon reduction effect of off-office audits. To this end, it is necessary to strengthen the efforts of the off-office audit in the industrial sector,to guide enterprises to practice green and low-carbon production and advocate for the public to follow green and low-carbon living and consumption, and form a good pattern of coordinated governance of carbon emissions by the government, enterprises, and the public.