Table of Content

16 January 2024, Volume 44 Issue 1

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The Path and Keys for China to Boost a Strong Financial System

WU Xiaoqiu

2024, 44(1):  1-6. 

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In October 2023，the Central Committee of the Communist Party of China held a Central Financial Work Conference，which clarified the direction for the future reform，development，and opening up of China's finance There are two particularly noteworthy points in the content of this meeting: firstly，it is proposed to accelerate the construction of China to a strong financial system；secondly，special emphasis is placed on the hub role of the capital market These two points have a guiding role in the future development of Chinas finance
The most important reason for Chinas development from a country with poor financial resources at the beginning of the reform and opening up to a welldeveloped financial system with vast and abundant financial resources today is its unwavering commitment to the path of a market economy with Chinese characteristics and the fundamental national policy of reform and opening up In the process of building China into a socialist modern country in an allround way and achieving the second centennial goal，we must aim to accelerate the building of a financial system and promote highquality financial development，so as to provide strong support for Chinese path to modernization to comprehensively promote the building of a strong country and the great cause of national rejuvenation
In order to achieve the goal of becoming a strong financial system，China needs to build a financial system based on its own national conditions and development goals，emphasizing the inclusiveness of finance and the development of digital financeMoreover，in the process of building a strong financial system，we should not only focus on individuality，but also reflect the common connotations of marketization，rule of law，and internationalization of financial powers In the process of becoming a strong financial system，we need to better leverage the hub function of the capital market represented by the stock market and the bond market，and build China's capital market into a transparent，highly liquid，and growth oriented wealth management market
While fully acknowledging the significant development of China's capital market，we also need to soberly recognize the gap between China's concept and institutional design and the goal of becoming a strong financial system On the basis of a profound understanding of the goals，connotations，and practical starting points of a strong financial system，we can find the path to achieving a strong financial system


Informatization Impact，Digital Government and Export Structural Upgrading

LIU Wenge, GENG Jingzhu, DU Mingwei

2024, 44(1):  7-20. 

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The information revolution is increasingly impacting the world economy The digitalization of government departments has become a key area of competition for national soft power In recent years，increasing the technological content of export products and optimizing the structure of export trade have become important strategic choices for China to build a trading powerhouse At this stage，promoting the digital transformation of government departments and accelerating the construction of digital governments have gradually become the key driving force for China's open economy to develop to a higher level in the digital economy era
This paper uses big data and machine learning methods to measure the digital government construction index of various prefecturelevel cities in China，and utilizes the Chinese Customs Database，BACI Database，and WDI Database to calculate the export technological sophistication of each city We also empirically examine the impact of digital government construction on export structure upgrading
The empirical results show that digital government construction can promote the upgrading of export structure Series of causal inference and robustness tests have verified the reliability of this conclusion Heterogeneity analysis shows that digital government construction can overcome the “digital divide” to promote the upgrading of exports，and has a greater impact on the central regions，western regions and regions with weak demographic dividends The mechanism analysis demonstrates that digital government construction facilitates the upgrading of export structure through the effects of innovationdriven growth，expansion of intermediate variety imports，and the establishment of a unified national market Furthermore，digital government construction can promote export structure upgrading by promoting resource reallocation among cities and facilitating product entry or exit Extended analysis reveals that smart city construction can effectively collaborate with digital government to jointly drive Chinas export structure upgrading
The policy implications are as follows：Firstly，it is imperative to further enhance the highquality construction of a digitized government，facilitate the deep integration of an efficient market and a promising government，and drive Chinas export structure upgrade through the digitalization reform of the government Secondly，it is essential to promote the balanced development of digitization in all prefecturelevel cities nationwide，thereby empowering the establishment of a unified national market and leveraging the transformative role of government functions in “digital trade” Thirdly，efforts should be made to enhance the construction of digital infrastructure，gradually eliminate multidimensional “digital divide”，and create favorable conditions for nurturing new advantages in China's export trade during this era characterized by a digital economy


China's Macroeconomic Report 2023：From Divergence to Balanced GrowthRUC Research Group of Macroeconomic Analysis and Forecast

Divergence to Balanced GrowthRUC Research Group of Macroeconomic Analysis and Forecast

2024, 44(1):  21-38. 

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In 2023，China's economy continued to recover and highquality development was solidly advanced In 2023，Chinas macroeconomy showed four new characteristics：the economic recovery process was tortuous；compared with the traditional economic recovery process，traditional leading indicators had failed during this recovery process；economic differentiation was obvious；and there was a large difference between macro performance and micro perception Behind these four new characteristics，the restoration of production and living order was the main driving force for economic recovery in 2023 The prominent problem was the insufficient endogenous aggregate demand and the slow recovery of confidence The reasons of the lack of aggregate demand are cyclical issues such as balance sheet shocks，and more importantly，structural problems For example，the traditional drivers of consumption are missing，and structural factors lead to overshooting of the real estate market，and trade among advanced economies is facing challenges Further investigation shows that behind the structural problems is that Chinas economy is in a period of deep adjustment and transition from focusing on incremental capacity expansion to adjusting stock and optimizing incremental growth The macro governance system and local government behavior model have not yet fully adapted The combined force of policies and policy transmission efficiency decrease In 2024，although cyclical and structural problems are still prominent，the most difficult period of economic transition has passed，cyclical forces will bottom out and gradually start to rise，and new structural momentum will continue to gather 2024 is still in the dividend window period after the “the 20th National Congress of the Communist Party of China”，the implementation period of a new round of government agency reform and stateowned enterprise reform，the breakthrough period of new technologies promoting domestic substitution，and the upward period of cyclical factors Based on comprehensive judgment，the economy will further return to normal growth in 2024 As cyclical forces bottom out and new momentum gradually gathers，various industries are expected to move from a state of divergence into a stage of balanced growth
In 2024，we should focus on the following risks：（1） the interest rate gap between China and the United States will be maintained for a long period of time，thereby suppressing domestic asset prices；（2） the possibility of real estate liquidity risk spreading；（3） the structural and regional nature of local government debt problems are prominent；（4） local governments may exert too much force，interfering with normal market adjustments；（5） export pressure on developed economies in the United States and Europe is great，and adjustments to the international industrial chain impact the upgrading of the export structure We recommend setting an economic growth target of 5% for 2024 In 2024，we must further clarify the direction of highquality development，timely launch practical new measures，enhance the confidence of enterprises and residents，and stimulate new momentum for economic development We should fully consider new changes in economic operations，strive to clear the transmission mechanism，and improve policy efficiency


The Development of Digital Financial Inclusion，the Restraint of Resource Misallocation and the Improvement of the Prosperity of SMEs

FANG Xianming, LIU Yuner

2024, 44(1):  39-54. 

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：The misallocation of resources under financial discrimination has become a constraint to the healthy and sustainable development of SMEs How to break through this constraint，the digital financial inclusion that integrates “inclusive” and “benefit” is highly expected Free from the constraints of physics，information and cost，digital financial inclusion can better adapt to the financing needs of SMEs，thereby helping SMEs to achieve healthy and sustainable development
Based on the connotation of digital financial inclusion and the demands of SMEs for healthy and sustainable development on financial resources，the paper conducts a theoretical analysis，and then builds a chained multiple mediation effect model，using the digital financial inclusion index and SMEs development survey data of 13 prefecturelevel cities in Jiangsu Province from 2015 to 2019 to test the effect and mechanism of digital financial inclusion development on the prosperity index of SMEs
The results show that digital financial inclusion has a significant positive effect on the prosperity of SMEs，and the improvement of coverage breadth，depth of use and digitalization level can promote the rise of the prosperity index of SMEs Likewise，the deepening of its use in payment，insurance，investment and credit also has a positive effect The results still hold after the robustness test，and the impact of endogeneity is also ruled out
The mechanism analysis indicates that the advance of digital financial inclusion can reduce the financing cost，thereby improving the matching degree of financing，and then improving the prosperity index of SMEs In particular，the development of digital financial inclusion has a balanced effect on the improvement of the prosperity of SMEs，and those with poor prosperity can benefit more from it
The research contributions include the following：Firstly，the research constructs a prosperity index for SMEs to measure their health and sustainability status from the composite dimensions of survival and development Secondly，the research focuses on the misallocation of resources in the financial support for the development of SMEs，and then reveals the mechanism of digital financial inclusion to enhance the prosperity of SMEs，where the financing cost and the matching degree of financing together constitute a chained multiple mediation effect Thirdly，the research confirms the balanced effect of the impact of digital financial inclusion on the prosperity of SMEs，which provides a new path for the realization of common prosperity from the perspective of healthy and sustainable development of SMEs
To this end，it is necessary to continue the development of digital financial inclusion，and use its function of suppressing the misallocation of financial resources to truly realize “cover hundreds” and “benefit thousands”


Patent Pledge and Firm Innovation

YU Jian1, LIU Xiaoguang2

2024, 44(1):  55-70. 

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With the promotion of the patent pledge pilot and the rapid development of patent pledge loans across the country，a proposition worthy of indepth study is whether the patent pledge has significantly improved the innovation ability of Chinese firms Or more specifically，can patent pledge notably stimulate firms to increase research and development （R&D） investment and improve patent output，and does it have a positive impact on the patent quality structure of firms? Against the backdrop of ownership disparities in Chinas credit market，do patent pledge loans exhibit similar characteristics and create new incentive distortions? This paper delves deeply into these pressing questions
Based on the Chinese Firm Patent Survey Data，the total number of patents is used to measure the innovation output of firms，the proportions of R&D expenditures and R&D personnel are utilized to reflect the innovation incentive of firms，and the proportion of invention patents in the total number of patents is employed to characterize the innovation quality of firms Building upon these measures，this study quantitatively investigates the impact of patent pledges on firms innovation output，innovation incentive，and innovation quality
It is found that the patent pledge significantly improves the innovation capabilities of firms，and its positive effect is not only reflected in the number of R&D outputs represented by the total number of patents，but also in the quality of R&D outputs represented by the proportion of invention patents Further analysis shows that the patent pledge has significantly enhanced the R&D incentives of firms and increased the proportions of R&D expenditures and R&D personnel Moderating effect analysis depicts that R&D job rewards can help expand the acceleration of the invention patent pledge to the innovation output of firms，but the R&D cycle will inhibit the acceleration of the patent pledge to firms innovation output to some extent The heterogeneous effect analysis indicates that patent pledge has an impact on the R&D output quantity，R&D output quality，and R&D incentives of firms with different ownership and size However，in comparison，the positive impact of patent pledges on the innovation output of stateowned enterprises and large corporations is more significant，whereas it demonstrates a more noticeable effect on the R&D investment and improvement in the patent quality structure of nonstateowned enterprises and small businesses The empirical results of this paper have provided certain policy enlightenment for the indepth development of patent pledge pilot projects and the enhancement of firm innovation capabilities
Compared to existing literature，the papers novelty primarily lies in two aspects：Firstly，due to the scarcity of microlevel data on patent pledge loans for firms，previous studies have provided limited insights from the perspective of patent pledges regarding firms innovation behavior，incentives，and capabilities This paper，leveraging data from the Chinese Firm Patent Survey Data and taking patent pledge loans as the starting point，delves into the impact of patent pledge loans on firms R&D investments，patent output，and patent quality，serving as a significant complement to existing literature Secondly，across different provinces and cities nationwide，intellectual property bureaus set varying entry thresholds for firms applying for patent pledges and patent quality，leading to potentially diverse impacts of different types of patent pledges on firms innovation capabilities Moreover，by examining the distinct responses of stateowned and nonstateowned enterprises to patent pledges regarding their innovation behavior，this study contributes to enriching the literature on ownership disparities and resource allocation


Analysis on the Mechanism and Effect of Governmental Funding on Corporate R&D Investment

ZHANG Yuchang1, ZHENG Jianghuai2, 3, RAN Zheng4

2024, 44(1):  71-86. 

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In order to deeply analyze the mechanism and impact of governmental funding in the process of corporate R&D investment，this article incorporates the policy of governmental funding into the decisionmaking process of corporate R&D investment，analyzes the mechanism of governmental funding policy on decision of corporate R&D investment，and further explores how governmental R&D funding affects the expected R&D benefits and reaction mechanism of corporate in the context of R&D uncertainty Theoretical models have found that governmental R&D funding has an incentive effect on Corporates own R&D investment The dynamic changes in the model indicate that there is a “learning by doing” effect in the corporate R&D activities Governmental funding has a dynamic impact on the corporate R&D investment In addition，based on the China Innovation Corporates Survey Database，the article empirically tests the impact of governmental R&D funding on corporate R&D investment The empirical results show that governmental R&D funding can effectively enhance corporate R&D investment，and this incentive effect is a dynamic process
The differences and potential innovations from existing literature lie in：Firstly，the article constructs a theoretical model to incorporate governmental funding into the decisionmaking framework of corporate innovation investment，and analyzes the mechanism by which governmental funding affects the R&D investment of corporate; Secondly，by analyzing the uncertain costs of governmental funding in reducing corporate R&D，and stimulating the enthusiasm of corporate to carry out innovation activities，corporates have a “learning by doing” effect in the process of innovation The accumulation of knowledge stock can improve the success rate of corporate innovation，enhance the expected R&D returns of corporates，and governmental funding has a dynamic impact on the corporate R&D investment; Thirdly，based on the China Innovation Corporates Survey Database，establish a policy evaluation model，and use a multi period DID model to analyze the policy impact of governmental funding on corporate R&D investment; Fourthly，through lag models and mediation effects models，we empirically test the dynamic effects and mechanisms of governmental funding on corporate R&D investment
The theoretical significance of this article lies in expanding the traditional R&D investment model from the perspective of corporate R&D investment decisionmaking，and quantitatively analyzing the impact of governmental funding on corporate R&D investment The practical significance of this article lies in the evaluation of the policy effects of governmental funding on corporate R&D，revealing that the key of governmental funding affecting corporate R&D investment is to reduce the cost of uncertainty in R&D The policy implication of this article is that corporate innovation is a key factor in achieving highquality economic development The government should better enhance the effectiveness of R&D funding policies


Economic Policy Uncertainty，Economic Financialization and Corporate Shadow Banking

GAO Bei, JIN Jian

2024, 44(1):  87-102. 

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Corporate shadow banking is a highrisk，hidden and regulatory arbitrage activity，and it is also a special form of corporate financialization It is of great significance to study the reasons for the growth of corporate shadow banking to alleviate systemic financial risks and promote highquality economic development This paper intends to carry out indepth research in this field
Considering the rapid development of economic financialization after 2008，this paper puts forward relevant research hypotheses on this issue on the basis of characteristic facts and theoretical analysis，and empirically tests the hypotheses based on the financial data of nonfinancial enterprises listed in China Shanghai and Shenzhen Ashares from 2000 to 2019 The results show that the impact of economic policy uncertainty on enterprise shadow banking has stage characteristics Before the formation of excessive financial economy，the rising uncertainty of economic policy will inhibit the shadow banking activities of enterprises；After the formation of excessive financial economy，the uncertainty of economic policy will promote the growth of enterprise shadow banking At the same time，the degree of economic financialization plays a positive role in it，which strengthens the differential influence of economic policy uncertainty on enterprise shadow banking Moreover，after the formation of excessive financialization of the economy，enterprises with financing advantages or operating weaknesses are more likely to engage in shadow banking activities，and financing advantages and operating weaknesses have superimposed effects on the expansion effect of enterprise shadow banking
The reason why the impact of economic policy uncertainty on enterprise shadow banking is different in stages is that the excessive financialization of the economy has caused the relationship between enterprise shadow banking and entity business activities to change Specifically，before the formation of excessive financialization of the economy，the shadow banking business of enterprises was attached to the physical business activities，and the uncertainty of economic policy would lead to the decline of the scale of enterprise shadow banking by restraining the allocation of operating assets of enterprises；After the formation of excessive financial economy，enterprise shadow banking gradually deviated from the real economic activities and became a “real credit intermediary” The uncertainty of economic policy caused the rapid growth of enterprise shadow banking by restraining the allocation of enterprise operating assets
Compared with the existing research，the marginal contribution of this paper lies in：Firstly，combining with the uncertainty of economic policy，this paper analyzes the external driving mechanism of the rising corporate shadow banking in China in recent years，and considers the stage characteristics of this influence，which makes up for the shortcomings of the existing research Secondly，from the perspective of economic financialization，this paper explores the reasons for the staged differences in the impact of economic policy uncertainty on enterprise shadow banking，and makes a comparative analysis of this staged difference from the theoretical and empirical levels，which is conducive to a more detailed understanding of the realistic logic behind the phenomenon of “deviating from reality to emptiness” caused by enterprise shadow banking


The Quantity and Price Allocation Effect of Labor Marketization Reform Affect the Mobility of Migrant Children

SHEN Xiaoyuan1, LI Weijian2, ZHANG Xingxiang1

2024, 44(1):  103-120. 

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Large-scale migration of rural residents in China has provided cities with abundant human capital，but it has also exacerbated the problem of leftbehind children in the meantime Paying attention to this important problem，we conduct a study exploring the impact of labor marketization reform on the migration decision of children in migrant families from both theoretical and empirical perspectives We firstly build a theoretical framework of labor marketization's impact on the migration decision of children in migrant families，which suggests that the labor marketization reform in cities can enhance the care capacity of migrant families for their children through price and quantity allocation effects，thereby promoting their children's mobility Then we verify the theoretical framework based on China's labor marketization index and micro survey data of the migrant population (CMDS Data)，revealing that labor marketization in cities has a significant influence on the probability of children moving with their families
Then we make further empirical analysis，revealing that the impact mechanism mainly manifests as a quantity allocation effect rather than a price effect These conclusions remain robust after restricting the sample，controlling the difficulty of migrant children's school enrollment and the characteristics of the outflow area，and using instrumental variables to alleviate endogeneity issues Heterogeneity analysis finds that the promotion effect of labor marketization on the mobility of children in migrant families is more significant for families with high parental skill levels，intraprovincial mobility，and those living in cities where laborin tensive industries are dominant
The policy implication of this paper is that the government can alleviate the problem of leftbehind children and intergenerational inequality by improving labor marketization reform to enhance the level of factor allocation，and this effect is currently mainly manifested as a quantity al location effect Based on the analysis of the mechanism of quantity allocation effect and price effect，the government can formulate some reasonable policies，such as encouraging small and micro enterprises to absorb migrant population for employment，relaxing household registration restrictions and lowering the entry threshold of urban labor market，focusing on resolving the obstacles in the process of migrant population entering the labor market，allowing labor production factors to achieve full allocation through market mechanism While deepening labor marketization reform，the policy maker should also consider the heterogeneity of different groups For example，it can carry out labor skill training for migrant population with loweducation level and establish provincial fiscal special transfer payment system for crossprovincial migrant families


The Internal Mechanism of How New Infrastructure Affects Labor's Wage and Wage Inequality

PI Jiancai, FAN Yanwei

2024, 44(1):  121-136. 

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This paper explores the underlying mechanisms of how new infrastructure affects labors wage and wage inequality，with a particular focus on the product bias of new infrastructure The paper starts by constructing a general equilibrium model that includes skilled intermediate goods，unskilled intermediate goods，and final products Skilled intermediate goods are produced using skilled labor and capital，while unskilled intermediate goods are produced using unskilled labor and capital Infrastructure plays a role by enhancing production efficiency The product bias of new infrastructure is reflected in its ability to significantly improve the production efficiency of skilled intermediate goods，reflecting the economic reality that new infrastructure can enhance the efficiency of digital products Additionally，this paper takes into account different production conditions based on a generalized production function
The impact channels through which new infrastructure influences labor wages can be divided into direct effect and indirect effect The direct effect is generated by the direct improvement in production efficiency due to new infrastructure，which simultaneously increases both types of labor wages Considering the skilled product bias of new infrastructure，the direct effect disproportionately increases the marginal productivity of skilled labor，thereby widening the wage gap The indirect effect arises from factor reallocation Due to the product bias，new infrastructure changes the relative wages between different types of labor，leading to relative price changes of intermediate goods This in turn alters the input proportions of intermediate goods in the production of final products，causing intersector capital flows and factor input adjustments This factor reallocation also has an impact on factor prices，depending on the substitutability between capital and different types of labor，as well as the substitutability between skilled and unskilled intermediate goods The results indicate that when the substitutability between capital and skilled labor is relatively low compared to the substitutability between intermediate goods，the indirect effect of new infrastructure has a positive impact on skilled wages Similarly，when the substitutability between capital and unskilled labor is relatively high compared to the substitutability between intermediate goods，the indirect effect of new infrastructure has a positive impact on unskilled wages This result suggests that，given a substitutability parameter between intermediate goods，if capital is less substitutable for skilled labor while unskilled labor is more substitutable for capital，the factor reallocation induced by new infrastructure can simultaneously increase both types of wages，providing a foundation for achieving “inclusive” growth of labor wages The results also show that changes in the wage gap depend solely on the substitutability between intermediate goods If there is a large elasticity of substitution between the two，new infrastructure with a skill product bias will widen the wage gap，while the opposite will narrow down the wage gap
Finally，this paper conducts a numerical analysis in the context of China's actual situation Based on the estimated results from the existing literature，the relationships between substitution elasticities in the overall economy of China generally satisfy the condition where the substitutability between capital and unskilled labor is greater than the substitutability between intermediate goods，which is greater than the substitutability between capital and skilled labor This suggests that under the current economic conditions，new infrastructure can bring about “inclusive” growth in labor wages，although its skill bias may widen the wage gap