China Industrial Economics is supervised by Chinese Academy of Social Sciences, and sponsored by Institute of Industrial Economics, Chinese Academy of Social Sciences. It aims to report researches on industrial economics and business management, and to reflect outstanding research results on Chinese industrial economy and enterprise development. The scope covers national economy, industrial economy and business management. The journal is included in CSSCI, and is the top journal in the field of industrial economics in China.
China’s mass entrepreneurship is conducive to building new momentum for economic development. Whether FDI, one of the most important forces to promote China’s economy, has a direct impact on China’s mass entrepreneurship warrants further investigation. Based on data from China Household Finance Survey and
China City Statistical Yearbook, this paper examined the impact of FDI on China’s mass entrepreneurship. FDI has two counterbalancing effects on China’s mass entrepreneurship: positive spillover effect and negative crowding-out effect. When the proportion of tangible assets of enterprises with FDI is relatively high, the positive spillover effect is strong. When the product markets of enterprises with FDI are mainly local markets, the negative crowding-out effect on local entrepreneurs is also strong. As for the impact on types of entrepreneurship, since FDI and markets of transformational entrepreneurship overlap significantly, FDI has an inhibitory effect on transformational entrepreneurship, but has no significant impact on subsistence entrepreneurship. As for the impact on particular industries, as the industry spillover index goes up, the promoting effect of FDI on entrepreneurship also increases. This paper founds that there is a direct relationship between FDI and mass entrepreneurship, which sheds light on how local governments can promote development of FDI and mass entrepreneurship with policies.
How to make top management incentive more effective and decrease agency cost has attracted high attention from both of the theory and practice cycles. The existing studies have focused on the rationality dimension of performance evaluation and influencing factors of compensation-performance sensitivity, and ignored the role and function of corporate risk taking. Different from previous literature, this paper tried to test the role of corporate risk taking in the process of setting executive compensation contracts. This paper analyzed the data of A-share listed companies from 2005 to 2016 in China’s capital market, with the following findings: Firstly, after operating performance is controlled, there is a significant positive correlation between risk taking level and executive compensation in the presence of the risk offset effect. Secondly, as risk aversion of top management strengthens, the risk offset effect of executive compensation increases. Thirdly, the risk offset effect of executive compensation is higher in an effective manager market environment. The above results indicate that risk taking is an important inherent influencing factor of executive compensation besides operating performance, and the effects are limited by internal and external situational factors such as risk aversion of top management and manager market. It is supposed to incorporate risk taking level into the process of setting executive compensation in the future, and make further adjustment according to internal and external environments. Further supplementary test shows that executive compensation plays partial mediation effect between risk taking and corporate value, which supports the rationality of incorporating corporate risk taking into the decision-making on compensation contracts. This paper clarifies the role of risk taking in executive compensation contracts and helps understand and recognize how to enhance effectiveness of executive compensation contracts from the risk taking perspective.
Trading risk due to asymmetric information is one of the main issues in international trades. Most of the countries involved in the Belt and Road Initiative have high risks in trades, and the asymmetric information problem is relatively severe. Report disclosure is a kind of reputation mechanism which can help trades alleviate moral hazard problems via disclosing non-payment records. We use dynamic signaling model to study the effect and scope of this mechanism. We find that “report disclosure” has several benefits. (1) It increases the total social welfare and the total trading volume. (2) It protects sellers, and helps sellers to avoid losing money because of underestimating the default risk. (3) It lowers the market prices, and protects honest buyers from default. However, report disclosure mechanism does not work in all cases as it will be affected by the turnover rate of buyers in the market. Under the Belt and Road Initiative, policy makers can decide whether to adopt the report disclosure mechanism depending on their own objectives. (1) If the policy maker’s objective is to protect exporters, and the market price is relatively low, then it is better to adopt the report disclosure mechanism. (2) If the policy maker’s objective is to protect importers and the markets where the market price is relatively high, buyers’ turnover rate is relatively low and the executive cost is relatively low, then it is better to adopt the report disclosure mechanism, and to cooperate with the e-commerce platforms of the countries involved in the Belt and Road Initiative by disclosing the defaulting buyers’ information.
The essence of stabilizing leverage is the dynamic adjustment process of capital structure. Starting from the financing demand and supply, which is critical to the capital structure dynamic adjustment, this paper establishes a logical framework to interpret the effect of economic policy uncertainty on the dynamic adjustment of enterprise capital structure through the uncertainty avoidance of both enterprises and financial intermediaries, and then empirically tested with the data of the manufacturing industry in the China Industrial Enterprise Database from1998 to 2013. Results show that economic policy uncertainty hinders the dynamic adjustment of capital structure through uncertainty avoidance; with the increase of economic policy uncertainty, in order to deal effectively with the decreasing income and increasing cost of capital structure adjustment, enterprises become more cautious in making investment decisions, and the financial intermediaries represented by banks would reduce the availability of financing by credit rationing, which ultimately leads to a slowdown in capital structure adjustment; moreover, the difference in sensitivity of policy changes in different industries does affect the capital structure dynamic adjustment of enterprises within the industry. This indicates that stable policy expectations are a prerequisite for stabilizing leverage. Therefore, under the new situation, in order to enterprisely promote the stabilizing leverage and reduce the friction of the dynamic adjustment of enterprise capital structure, we should not rely solely on monetary and financial policies, but should also focus on stabilizing market expectations in terms of the key points affecting enterprises’ confidence in long-term investment and financial intermediary financing, grasping the impact of macroeconomic policy adjustments and their overlap on enterprises of different industries to improve policy orientation, as well as strengthening the forward-looking, consistency and stability of policies.
Based on the realistic background of incomplete contract, this paper innovatively analyzes the mechanism between intellectual property protection and enterprise’s export technological complexity. Through the game equilibrium between the manufacturer and the supplier, it is explained that under the condition of incomplete contract, strengthening intellectual property protection will reallocate more residual claims of returns on high technology’s investment to suppliers，reduce the risk of being “ripped off” of supplier, encourage suppliers to increase investment in high technology，and then lead to the improvement of the technology level of the whole society. The export technological complexity of enterprise, calculated by using the matching data between Chinese industrial enterprises database and Chinese customs trade database, supports the hypothesis that strengthening intellectual property protection will promote export technological complexity of enterprise. The study also found that strengthening intellectual property protection is more benefit for improving the export technological complexity of enterprises with the high intensity of contract and non-state-owned enterprises, for narrowing the gap of export technological complexity between east and mid-west. Intellectual property protection can incentive human capital investment of high technical activities, activate the enterprise to innovate and improve enterprise’s export technological complexity. The empirical results show robust characteristics for samples with different econometric methods, instrumental variables and time intervals for endogeneity, core index. This paper’s study has an important enlightenment on Chinese economy how to stimulate the enterprise’s vitality and innovation and achieve high-quality development pattern.
Optimizing the income distribution and narrowing the income gap are the key policies of the 13th Five-Year Plan. Based on the data from the National Population Sample Survey in 2005, this paper attempts to be the first to analyze the sources of the wage gap between cities in China through agglomeration and selection effect, using the approach of unconditional distribution feature and parameter correspondence. The research findings are as follows. Firstly, both agglomeration and selection effects are important sources of the wage gap between cities, in which the agglomeration effect dominates. However, neglecting the selection effect will severely overestimate the agglomeration effect. Secondly, the high-wage workers and low-wage workers coexist in the megalopolis. The medium-wage workers are mainly clustered in the middle-scale cities. Thirdly, the high-wage workers benefit more through the agglomeration effect in the large cities, and wage inequality in these cities is more remarkable. Thus the wage gap between cities is even more pronounced for high-wage workers. Finally, high-wage workers are mainly concentrated in the private firms of large cities. In addition, the workers of private firms are the main embodiment of the wage gap between cities, who benefit more from the agglomeration effect.
