Table of Content

16 September 2021, Volume 41 Issue 9

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A STUDY ON THE COMMUNIST PARTY OF CHINA'S THOUGHTS ON PUBLIC FINANCE DURING THE LAND REVOLUTION WAR IN CHINA

GAN XiaowuZ, OU Jinwen, ZHU Huaxiong

2021, 41(9):  4-19. 

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Facing China's social and economic transformation today, under the background with public finance rising as the foundation and important pillar of national governance in China, and on the eve of the centenary of the birth of the Communist Party of China, it would be of important theoretical and practical significance that we make researches on the Communist Party of China's thoughts on public finance during the Land Revolution War. Thoughts come from reality and also reflect reality. The special social, political and economic background during the Land Revolution War in China had given birth to the Communist Party of China's thoughts on public finance, which includes specifically the fiscal revenue, the fiscal spending and the fiscal management. Such three aspects are much closed to each other, which have comprised of a basic framework of the traditional subject of public finance and formed important source of thoughts on modern public finance, and also constituted a basic policy guide for our contemporary fiscal practices and construction of the modern fiscal institutions.

INCOME INEQUALITY AND ECONOMIC GROWTH: THE MOVING KUZNETS CURVE——The Thought and Significance of Income Distribution Reform in the New Era

LIU Lihua, SUN Zao

2021, 41(9):  20-34. 

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Evaluating the impact of income inequality on economic growth is critically important to judge the reforms of Chinas income distribution system in all development stages. This paper incorporates income inequality into the framework of Unified Growth Theory and constructs a theoretical model that endogenously determines population size, inequality and economic growth. The empirical study is carried out using China's provincial panel data and the income inequality index is constructed based on the CGSS data. Empirical results show an inverted Ushaped relationship between inequality and economic growth. Moreover, the inverted Ushaped curve gradually moves to the leftside as economy develops, suggesting that the optimal inequality reduces in pace with the development of the economy. These findings suggest that, since the reform and opening up, Chinas income distribution system reform in each period is the optimal choice under the specific historical conditions. The conclusions of this paper have profound policy implications: the achievements of eliminating poverty should be consolidated and the income inequality should be reduced in line with economic development.

THE FINANCIAL STABILITY EFFECTS OF THE TWOPILLAR ADJUSTMENT

MA Yong, HUANG Huihuang

2021, 41(9):  35-54. 

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Based on crosscountry panel data of 42 countries over the period of 1991-2016, this paper examines the financial stability effects of the twopillar framework. Empirical results show that: (1) Both monetary and macroprudential policies are significantly effective in curbing household credit growth, which proves the role of twopillar policy in mitigating the procyclicality of financial risk. (2) Loantargeted macroprudential tools and macroprudential policy groups for lenders and borrowers have a more significant financial stability effect. (3) The financial stability effect of the twopillar framework is significantly different at different levels of economic development, where the macroprudential policy is more effective in emerging economies but the coordination effect of twopillar framework is more significant in advanced economies. (4) In advanced economies, monetary policy is more effective in adverse times but macroprudential tools and their interaction with monetary policy are better in upward cycle. (5) Only a fraction of Macroprudential tools have a milder side effect on unemployment, private consumption and price.

THE INCENTIVE EFFECTS OF GOVERNMENT INNOVATION SUPPORT ON ENTERPRISES' R&D INVESTMENT UNDER DIFFERENT SUPERVISION SITUATIONS——Evidence from Agricultural Listed Companies

蒋樟生

2021, 41(9):  55-70. 

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In recent years, the problem of “agriculture, countryside and peasants” is very prominent. To deal with the severe challenges of agricultural upgrading and development from multiple pressures such as external resources, environment, science, and technology, the government departments have introduced many innovation incentive policies to inspire the R&D and innovation of technology of agricultural companies. This paper analyzes the impact of two forms of government innovation support policies, namely, government subsidies and tax & fee returns, on the R&D investment of agricultural companies from the perspective of government intervention, mainly focusing on institutional investors and leading shareholders participating in internal corporate governance and social audit institutions participating in external corporate governance to play a role between government innovation support and enterprises' R&D investment in the different supervision situations. The findings are as follows: Firstly, various government support policies (government subsidies and tax & fee returns) have different effects on R&D investment of agricultural companies. Government subsidies have substitution effects, while tax & fee returns have complementary effects. Secondly, the enhancement of shareholding supervision (the shareholding proportion of institutional investors and major shareholders) can strengthen the substitution effects of government subsidies and the complementary effects of tax & fee returns on R&D investment of agricultural companies. Thirdly, the enhancement of audit supervision (the audit opinions of social audit institutions) can weaken the substitution effects of government subsidies and the complementary effects of tax & fee returns on R&D investment of agricultural companies. These research findings can provide some academic supports and policy references for formulating appropriate government innovation support and giving fair play to the role of shareholding supervision and audit supervision in internal and external corporate governance.

DOES MIGRATION PROMOTE INTERREGION MERGERS AND ACQUISITIONS

LI Chang, SHAO Yuhui

2021, 41(9):  71-84. 

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This paper examines the effect of migration on interregion mergers and acquisitions (M&As) using the M&A data and National Population Census data. The results show that a large volume of immigrants promotes firms in recipient regions to make M&A investments in the home regions, and the effect is more striking for immigrants with tertiary education or those working in finance industry. Further analysis shows that the influence of migration on M&As is more pronounced when target regions (home regions of immigrants) have a lower degree of marketization, weaker investor protection, stronger Confucian tradition, or lower cultural tolerance. This paper provides robust evidence that migration imposes a substantial impact on the volume of interregion M&As by overcoming investment barriers and provides policy implications for the deepening reform of household registration and the promotion of interregion investments.

AN EMPIRICAL STUDY ON THE LOCAL ADVERSE RESPONSE TO THE THIRD PARTY IN THE EXIT EVALUATION OF POOR COUNTIES——From the Perspective of Nash Equilibrium Theory

WANG Zhuo, DING Hongbin

2021, 41(9):  85-98. 

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In the five years from 2016 to 2020, 780 of 832 national povertystricken counties have passed the special assessment organized by thirdparty organizations and got rid of the poverty hat. In the field evaluation, there are many positive interactions between the third party and multiple local participants, but it is difficult to say that the adverse response of some local stakeholders to the evaluation is a benign interaction. Adverse response refers to the negative response of poor counties to thirdparty assessment work through false cooperation, noncooperation, and even artificial obstacles during the exit process of poor county list. This kind of negative response not only leads the third party into the “low efficiency trap” and “double interest game trap”, but also makes the central government's desire to make up for the central governments poor governance information asymmetry through the third party in vain. Based on the Nash equilibrium theory, this paper analyzes the game among the third party, the local government and the poor families. Combined with the field data of the exit assessment of a poor county, it is found that some poor families and local government cadres tend to adopt the adverse strategy in the process of exit assessment of povertystricken counties. Through the analysis of the reasons for the nonbenign interaction among the local government, the poor families and the third party, the paper finally puts forward the policy suggestions of “restraining the local excessive adverse response and promoting the positive response”, so as to serve the construction of the acceptance mechanism of relative poverty governance in the stage of comprehensive rural revitalization.

THE THRESHOLD EFFECT OF CLEAN ENERGY DEVELOPMENT ON EMPLOYMENT——Based on the Perspective of Financial Scale

WEI Lili, YANG Ying

2021, 41(9):  99-112. 

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Based on the 2008-2019 provincial panel data, this paper examines the employment effect of the development of the clean energy industry, and uses the panel threshold model to analyze the financial scale threshold effect of the development of clean energy industry on labor employment. Empirical research shows that: clean energy development promotes the overall employment scale, has a negative effect on the employment scale of the traditional energy industry, and has heterogeneity in the employment impact in different clean energy production regions; when financial scale is used as the threshold variable, it is found that the increase in financial scale has promoted the development of the clean energy industry and has significantly increased the overall employment scale, and the impact on the employment scale of the traditional energy industry has decreased; from a regional perspective, the impact of clean energy development on labor employment differs across regions. The difference is reflected in the fact that the development of clean energy has a positive effect on the overall employment scale in the eastern and western regions, while it has a negative effect in the central region. Based on this, policy recommendations are made from improving policy incentive mechanisms, increasing support from the financial sector, and local governments implementing policies in accordance with local conditions, so as to give full play to the role of clean energy industry development in job creation and energy structure optimization.