Accurately measuring inflation is a fundamental prerequisite for achieving price stability and enhancing the effectiveness of macroeconomic governance. While the Consumer Price Index (CPI) has long served as the core indicator for inflation measurement, the “perception gap” between households' perceived cost of living and the official CPI has become increasingly salient. Specifically, as asset markets evolve and digital finance expands, the nexus between asset price fluctuations and inflation perception bias has emerged as a critical concern. In this context, refining the inflation measurement system is of profound theoretical and practical importance for bolstering the credibility of inflation indicators and optimizing monetary policy regulation.
Existing studies have explored the determinants, measurement, and correction of inflation perception bias. However, in-depth analysis is still needed regarding the interconnected effects, underlying mechanisms, and the moderating role of digital finance in the relationship between asset price fluctuations and inflation perception bias. The Engel curve method represents a typical approach to measuring inflation perception bias by capturing the stable mapping between micro-level consumption structures and real purchasing power. Nevertheless, the standard Engel curve framework typically relegates unexplained systematic deviations to time-fixed effects, rendering the results a “residual” measurement. Taking housing prices as a representative asset price, we incorporate the impact of housing prices on households' real purchasing power into the classical Engel demand system. This allows us to identify a component of inflation perception bias linked to housing price fluctuations, enabling a revision of the CPI from the perspective of households' true cost of living. Moreover, we introduce digital financial development into the research framework to explore its moderating effect on the nexus between asset prices and inflation perception bias.
Utilizing city-level panel data from 2011 to 2023 in China, we reveal a significant bias component induced by housing price fluctuations. We find that rising (falling) housing prices lead to a negative (positive) housing-price-related inflation perception bias (HPB). Based on these estimates, we construct a housing-price-adjusted cost-of-living index (HCI). During the housing boom from 2011 to 2020, the HCI remained consistently below the CPI, suggesting that housing appreciation buffered the perceived pressure from rising living costs. Following the market correction after 2021, this gap narrowed rapidly and then reversed. This implies that households' perceived inflation has outpaced official CPI figures, offering a partial explanation for the recent sluggishness in Chinese household consumption while highlighting the inherent synergy between policies aimed at stabilizing the housing market and those bolstering consumption. Mechanism analysis, using data from the China Household Finance Survey (CHFS), demonstrates that housing price fluctuations influence consumption decisions primarily through the wealth effect rather than the consumption substitution effect.
Based on this, we integrate digital financial development into the empirical analysis, and find that digital finance amplifies the impact of asset price fluctuations on inflation perception bias by strengthening the wealth effect, implying that digital finance widens the gap between households' perceived cost of living and official inflation figures. These findings suggest that as digital finance continues to evolve, improving the inflation measurement system becomes increasingly imperative. Beyond refining the CPI basket, policymakers should account for the impact of asset prices on the perceived cost of living to better track changes in real purchasing power and stabilize market expectations.
This study makes three primary contributions. First, we extend the standard Engel curve method by incorporating asset price effects on real purchasing power, offering a novel framework for the measurement of households' real cost of living. Second, from a micro-consumption perspective, we identify the key mechanism through which housing prices shape inflation perception, providing fresh insights into the micro-foundations of inflation perception bias. Third, we integrate digital finance into the analytical framework, presenting robust empirical evidence on how digital finance moderates housing-price-related inflation perception bias.

In recent years, the rapid growth of China's public debt, particularly the persistent expansion of implicit debt, has sparked concerns regarding systemic financial risks. To address this, the central government has sought to “open the front door” by issuing special bonds to meet local governments' legitimate financing needs and curb their reliance on irregular debt. However, the effectiveness of these special bonds in curbing implicit debt remains unclear. While existing research largely focuses on debt swaps for existing local government financial vehicles (LGFV) bonds, there is a lack of systematic study on how new special bonds, designed to fund capital expenditure, influence the accumulation of implicit debt. Exploring this issue is crucial for optimizing the debt management system and balancing economic stability with risk prevention.
This paper investigates whether issuing new local government special bonds effectively “closes the back door” of implicit debt by “opening the front door.” It identifies three core mechanisms: the substitution effect, where special bonds replace high-cost implicit debt; the matching effect, where projects partially funded by special bonds necessitate additional LGFV financing, potentially driving up implicit debt; and the implicit guarantee effect, where bond issuance reinforces expectations of government bailouts and subsequently influences the cost and scale of implicit debt. The paper employs empirical analysis to evaluate the relative significance of these mechanisms in practice.
This paper empirically examines the impact of new special bond issuance on implicit debt from 2017 to 2022, using city, LGFV, and bond-level data sourced from municipal final accounts and the WIND database. To address endogeneity, we construct a Bartik instrumental variable (IV) based on the sectoral distribution of local state-owned enterprise investment in 2016 and provincial-level changes in special bond allocations, which satisfies the requirements for relevance and exogeneity.
Our study reveals four primary findings. First, at the aggregate level, an increase in new special bonds does indeed reduce implicit debt accumulation. For every 1 RMB increase in special bonds, implicit debt decreases by 0.72 RMB. This indicates that the “substitution effect” is the dominant mechanism, though it falls short of a one-to-one substitution. Second, mechanism analysis confirms the existence of a positive effect that partially offsets the “front door” policy's efficacy, characterized by a significant expansion in the interest-bearing debt of the specific LGFVs undertaking these projects. Third, by analyzing the impact on LGFV bond pricing, we distinguish between the “matching effect” and the “implicit guarantee effect,” finding that the positive impact on implicit debt arises primarily from the “matching effect.” Finally, spillover effects among LGFVs indicate that when certain vehicles within a city undertake special bond projects, the implicit debt of other vehicles decreases, confirming that the substitution effect prevails among peer LGFVs within the same city.
Based on these findings, this paper offers three policy recommendations. First, continue to widen the “front door” for local government borrowing. According to macroeconomic performance, moderately increasing special bond quotas can meet legitimate funding needs and dampen the incentive for implicit borrowing at the source. Second, improve the matching financing system for special bonds. Given the limited revenue potential of some projects, local governments should increase the ratio of proprietary fiscal funds to reduce reliance on market-based leverage and enhance project screening to prevent the “packaging” of ineligible projects to obtain irregular financing. Third, firmly “close the back door” by accelerating the market-oriented transformation of LGFVs. It is essential to sever the excessive financing dependence between the government and LGFVs, fostering their development into self-sustaining entities while institutionalizing accountability for implicit debt to ensure that the “front door” policy replaces existing debt without fueling new risks.
This paper contributes to the literature by evaluating the actual effectiveness of new special bonds in controlling implicit debt following the implementation of the new Budget Law. Furthermore, it expands the study of intergovernmental fiscal relations into the realm of project-specific matching financing, revealing the spillover effects inherent in this institutional design. Finally, by providing micro-level evidence on the internal mechanisms of fiscal management and debt expansion, this study offers new insights into the logic of China's local public debt growth and proposes refined policy approaches for the debt regulatory framework.

In recent years, the issuance scale of local government special bonds in China has expanded rapidly, establishing special bonds as a crucial instrument for implementing a proactive fiscal policy and supporting infrastructure development as well as the execution of major national strategies. Under the management model characterized by “provincial issuance and city/county use”, how special bond quotas are allocated across provinces and cities directly affects the efficiency of fiscal funds and the controllability of debt risks. Entering the 15th Five-Year Plan period (2026-2030), achieving effective use of debt and orderly resolution of debt through a scientific quota allocation mechanism has become a central issue in enhancing the efficiency of special bond funds. In practice, to secure larger amounts of special bond funds, prefectural-level governments often proactively plan projects in alignment with provincial-level priority development areas, thereby creating a two-way interactive pattern of “top-down” planning guidance and “bottom-up” strategic responses. However, whether this mechanism actually improves the efficiency of special bond funds allocation, and whether provincial policies can effectively steer prefectural-level governments to direct funds toward economically and socially urgent development areas, remain to be answered. Existing studies have examined the determinants of quota allocation from perspectives such as government creditworthiness (Zhu & Fan, 2024), fiscal capacity, or geographical distance (Zhu & Hu, 2024). However, they fail to provide sufficient empirical evidence on the aforementioned micro-mechanisms and their actual effects.
This paper uses textual data from provincial 14th Five-Year Plan (2021-2025) and project-level micro-data on special bonds from 2018 to 2024 to identify the key areas for special bonds across 31 provinces and equivalent administrative units. It constructs a difference-in-differences model to investigate the guiding effect of provincial 14th Five-Year Plan (2021-2025) on prefectural-level special bond investment and the economic and social outcomes. The findings show that the 14th Five-Year Plan has a significant positive guiding effect: areas designated as provincial priorities receive significantly larger amounts of special bond funds. Further analysis reveals that this guiding effect is more pronounced in regions with lower levels of project information disclosure, in sectors with a strong public welfare orientation, and in areas supported by functional industrial policies. Extended analysis demonstrates that special bond investment in key areas enhances regional innovation foundation and the supply of high-quality production factors, effectively promoting regional industrial structure upgrading. In this process, provincial authorities, through rigorous project screening, encourage localities to plan projects based on their own endowments and local conditions. At the same time, provincial authorities channel limited fiscal resources toward strategically prioritized national development areas, leveraging the institutional advantage of concentrating resources for major undertakings, thereby ensuring that special bond investment genuinely serves regional development and the broader goal of high-quality development.
The contributions of this paper are threefold. First, from the perspective of strategic interactions between provincial and prefectural governments, it demonstrates the linkage logic whereby prefectural governments plan projects around provincial priorities and provincial governments guide key areas through quota allocation, thereby contributing to the literature on the determinants of special bond quota allocation. Second, it systematically evaluates the guiding effect of provincial“14th Five-Year Plan”policies on local investment decisions and reveals the allocation logic of special bond funds across micro-level sectors. Third, from the perspective of local public debt, it assesses the implementation of provincial 14th Five-Year Plan, clearly presenting the effectiveness of special bonds in serving provincial key development areas and aligning with national strategies. Collectively, these contributions provide empirical evidence for optimizing the special bond management system and enhancing fiscal sustainability.
Based on the above findings, this paper derives three policy implications. First, strengthen the performance-based accountability mechanism for special bonds. A full-life-cycle performance evaluation system covering project planning, fund allocation, construction and operation, and revenue collection should be established, with evaluation results serving as an important basis for the quota allocation in the following year. Acts such as false project reporting and idle funds should be subject to legal accountability. Second, advance a dual-review mechanism for special bond projects. Third-party institutions should be introduced to participate in the review process, with their evaluation results given substantive weight, thereby preventing, at an institutional level, strategic application-driven behaviors. Third, establish a risk-sharing mechanism for special bond projects. The capital contribution ratios and debt repayment responsibilities of provinces, cities, and counties should be clearly defined according to the beneficiary-pays principle. By properly allocating risks, local expectations can be stabilized and the quality of project planning enhanced.

As China's economy transitions to a “new normal” of slower growth, regulating local governments' implicit debt is crucial for economic and financial stability. The 2014 revision of the Budget Law and the issuance of the Opinions on Strengthening the Management of Local Government Debt have clarified the rules governing local government borrowing, prohibited the illegal creation of implicit debt, and assigned provincial governments the supervisory responsibility and accountability authority over lower-level governments. In 2017, the Ministry of Finance launched a public accountability campaign against raising implicit debt, emphasizing “lifelong accountability and retroactive investigation” to curb debt increments. Recently, central regulation has maintained a “zero-tolerance” stance, shifting toward a dual focus on “resolving the existing stock” and “curbing the increment.” The 2026 Government Work Report further reinforced this by treating the prevention of new implicit debt as an rigid discipline requirement However, implementation issues, such as oversimplified accountability, non-standard procedures, and superficial enforcement, have sparked debate over the actual efficacy of these campaigns.
In this context, this paper manually compiles public accountability events initiated by the Ministry of Finance, focusing on the issue of the raising of implicit debt by local governments. Employing a staggered difference-in-differences design, we evaluate the impact of such accountability under the localized responsibility system on the expansion of implicit debt. The study finds that public accountability significantly curbs the expansion of implicit debt in the cities subject to public accountability. Simultaneously, under the localized responsibility system, public accountability strengthens the efforts of provincial governments to control implicit debt within their jurisdictions, leading to a spillover effect that restrains implicit debt expansion in other cities of the same province. Mechanism analysis reveals that public accountability operates through two channels: first, by enhancing supervision and governance over local government implicit debt, thereby reducing opportunities for violations; second, by weakening the performance incentives for local governments to increase investment through raising implicit debt, thereby lowering the motivation for debt accumulation on the expenditure side. Furthermore, advancing accountability regarding key financing channels for implicit debt, such as bank loans and trust financing, enhances the effectiveness of accountability measures. Additional analysis shows that while public accountability may worsen investor expectations regarding implicit debt risks, accompanying policies such as debt swaps can effectively mitigate such concerns.
This paper makes three main contributions. First, we broaden the perspective of fiscal decentralization theory by incorporating the localized responsibility system into local debt management. We examine how public accountability influences strategic interactions between provincial and subordinate governments, enriching the vertical management framework of multi-level governments. Second, we identify shifts in local governments' incentives and behavioral logic regarding implicit debt. We show that public accountability not only suppresses implicit debt in penalized cities but also generates a spillover effect across the province by strengthening provincial-level governance. Third, we address the question of what kind of accountability is most effective. We find that targeting primary financing channels and emerging irregular practices improves accountability outcomes, providing a basis for more precise and effective mechanisms.
These findings offer several policy implications. First, institutionalizing government transparency and debt supervision is essential for maximizing the efficacy of public accountability. Consolidating provincial localized responsibility facilitates top-down implicit debt control, curbing expansion at lower levels. Second, establishing a coordinated mechanism for debt information sharing and audit supervision across government levels is necessary. Additionally, incorporating implicit debt governance into officials' performance evaluations can help reverse the high-debt, investment-driven development model. Third, accountability measures should target primary financing channels (e.g., bank loans, trusts) and emerging irregular practices (e.g., disguised borrowing via government service procurement). Fourth, differentiated debt resolution policies should accompany public accountability based on regional economic conditions. For regions with high debt risks or heavy reliance on government investment, expanding debt swaps during accountability campaigns can mitigate risks and free up local resources for high-quality economic development.

In the context of China's “dual carbon” strategy, firms increasingly face forward-looking transition risks arising from potential asset stranding and earnings uncertainty during the low-carbon transition. Existing studies typically measure transition risk using historical carbon emissions or emission intensity. However, such backward-looking indicators fail to capture the dynamic alignment between firms' future decarbonization paths and policy targets. Meanwhile, investors have begun to incorporate firms' low-carbon transition performance into asset allocation decisions, and net-zero portfolios have emerged as an important tool for managing transition risk. Against this background, this study develops a forward-looking measure of corporate transition risk and examines the impact on firms' implied cost of capital.
Specifically, we construct the Duration of Retention (DOR), defined as the number of years a firm is expected to remain in a dynamically constructed net-zero portfolio from a base year to 2060. A shorter DOR indicates higher forward-looking transition risk. To construct this measure, we first establish a carbon budget path consistent with China's “dual carbon” targets. We then estimate firms' future emissions based on historical emission trends and scenario projections consistent with the Paris Agreement. Based on these forecasts, firms are ranked according to predicted emissions and selected into the net-zero portfolio subject to the carbon budget constraint. The cumulative number of years a firm remains in the portfolio constitutes its DOR. This approach captures the deviation between firms' projected emission paths and policy-consistent trajectories, thereby providing a forward-looking assessment of transition risk.
Using a sample of Chinese A-share listed firms from 2020 to 2024, we examine the relationship between DOR and firms' implied cost of capital (ICC), which serves as a proxy for investors' expected returns. Carbon emissions data are obtained from the S&P Trucost database, financial data from the CSMAR database, and analyst forecasts from the Wind database. ICC is estimated using multiple valuation models, including PEG, MPEG, Gordon, OJ model, and a composite indicator called CICC.
The empirical results reveal a significant negative association between DOR and ICC. Firms with shorter DOR, indicating higher transition risk, face higher costs of equity, suggesting that investors require higher risk premia for firms with weaker decarbonization prospects. This finding remains robust across alternative specifications, including the use of analyst forecasts and additional robustness checks. Further analysis reveals that DOR affects ICC through three channels: asset impairment losses, greenwashing behavior, and agency conflicts. Firms with higher transition risk are more likely to experience asset impairments, engage in greenwashing, and exhibit more severe agency conflicts, all of which increase perceived risk and raise the cost of equity.
Heterogeneity analyses indicate that the impact of DOR on ICC varies across institutional environments and firm characteristics. The effect is more pronounced for state-owned enterprises, firms that do not disclose carbon-related information, and firms located in regions with weaker environmental governance. These findings highlight the roles of ownership structure and information transparency in shaping the pricing of transition risk.
This study contributes to the literature in several ways. First, it develops a forward-looking measure of transition risk based on the net-zero portfolio framework, addressing the limitations of traditional static indicators. Second, it aligns the construction of net-zero portfolios with China's “dual carbon” targets, enhancing policy relevance. Third, it provides empirical evidence on the pricing of forward-looking transition risk in the cost of equity. Fourth, it identifies the channels through which transition risk affects capital costs, offering new insights into the mechanisms of climate risk pricing.
Based on these findings, we propose several policy implications. Improving carbon information disclosure can reduce information asymmetry and enhance pricing efficiency. Strengthening regional environmental governance can mitigate institutional disparities and improve the effectiveness of climate risk pricing. In addition, promoting green financial instruments can facilitate capital allocation toward low-carbon sectors.
This study has several limitations. Carbon emissions data rely on third-party databases and may be subject to measurement constraints. The assumed decarbonization pathways may deviate from actual policy implementation, and the prediction of future emissions may not fully capture technological progress. Future research could incorporate more granular data, such as green patents, to construct more refined models of emission trajectories.

Optimal tax system design emphasizes improving relevant systems within the tax field, yet it overlooks the possibility that enterprises respond to regulation by adjusting their organizational forms. Notably, an increasing number of sole proprietorship enterprises have emerged in the market, consistent with the rising number of affiliated enterprises. Existing studies mainly analyze tax evasion from the perspective of corporate finance and overlook the impact of corporate organizational forms on tax compliance and their resulting institutional consequences. Taking the commercial registration system reform in March 2014 as a quasi-natural experiment, this paper analyzes the impact of the reform on the market entry, tax payment behavior and factor allocation efficiency of sole proprietorship enterprises by using matched administrative data from Chinese firms, taxation and corporate recruitment data from 2012 to 2014. This study provides empirical evidence for identifying the strategic selection of organizational forms and their subsequent tax effects.
This study yields four main results. First, the commercial registration system reform has promoted the entry of sole proprietorship enterprises into the market and these enterprises remained small in scale. Second, the mechanism is that the reform has lowered registration thresholds and increased the number of administrative licenses. Third, the actual tax burden of such enterprises has declined while tax-related violations have increased, which reflects certain tax avoidance intentions. Fourth, by analyzing equity affiliation data of each enterprise, we find that the registration reform has increased internal connections within enterprise groups but has not created employment or boosted investment. This has weakened the social benefits of the reform to a certain extent and become an important aspect for understanding tax administration of specific enterprise organizational forms.
The above conclusions provide several policy implications for the development of sole proprietorship enterprises and tax governance practices. First, we should strengthen the synergistic governance effect of market access and tax collection and administration. Industry and commerce authorities can provide more sufficient basic information and operating status of market entities, which will help tax departments achieve more effective tax collection and administration. Therefore, we should actively promote cross-regional, cross-level and cross-departmental coordination and cooperation, improve the mechanism of information sharing between departments, and further strengthen internal coordination and cooperation within the government. Through information sharing and joint law enforcement, we can better detect market disorders, reduce tax risks and improve the governance and service capacity of the government.
Second, the establishment of an information monitoring and feedback mechanism for job creation is crucial. Specifically, we should intensify information monitoring of job creation, establish a complete enterprise information database and employment statistics system to help the government and relevant departments keep abreast of the employment situation of enterprises. At the same time, we should set up an information feedback mechanism for job creation. This will support the growth of small and medium-sized enterprises and sole proprietorship enterprises, promote the coordinated and integrated development of large, medium and small enterprises, and improve the quality of employment.
Third, the tax framework must be refined to standardize preferential treatments for different entity types, thereby ensuring fiscal equity. The government should accelerate the issuance of regulations and guidelines on the application of tax preferential policies for specific organizational forms. In addition, we should establish and improve tax audit and supervision mechanisms, guiding all types of enterprises to enhance their management systems, strengthen compliance awareness, fulfill social responsibilities, and ensure that tax incentives genuinely benefit the development of their intended beneficiaries.
The academic contributions of this paper are threefold. First, we supplement existing research on tax avoidance by enterprises through specific organizational forms. Taking the market entry motives of sole proprietorship enterprises as the entry point, this paper analyzes the impact of the commercial registration system reform that lowers the market entry barriers on the market entry and tax payment behavior of sole proprietorship enterprises, and reveals that entry cost is also an important institutional factor affecting tax avoidance through organizational forms.
Second, existing studies focus on the tax evasion behaviors of independent enterprises while neglecting the analysis of such behavior among affiliated enterprises. From the perspective of intra-group affiliations, this paper reveals the phenomenon that enterprises engage in potential tax avoidance by establishing affiliated companies, which to a certain extent broadens the understanding of corporate tax avoidance approaches.
Third, this paper provides governance solutions and policy suggestions for enterprises to align with tax policies through organizational form management. It finds that the commercial registration system reform aimed at encouraging enterprise entry has boosted the rapid entry of sole proprietorship enterprises, yet failed to make substantial contributions to tax revenue, employment, investment and financing, which deserves high attention from all sectors. Accordingly, this paper puts forward operational policy suggestions.

Long-standing “execution difficulties” have posed a significant obstacle to achieving judicial protection for creditors. The third plenary session of the 20th Central Committee emphasized the need to “deepen the reforms to separate adjudicatory and enforcement powers, and improve the national system for law enforcement.” Addressing execution challenges through judicial reforms is not only an intrinsic requirement for fostering a favorable trade credit environment, but also critical for strengthening the credit and rule-of-law foundation of the socialist market economy. The issue of execution difficulties is closely related to the integrated operational model of trial and execution under the current system, where judges are responsible for both adjudicating cases and overseeing executions. This arrangement increases the workload of enforcement personnel, exacerbates case-to-staff imbalances, and blurs responsibility divisions, leading to inefficiencies and potential corruption or irregularities in compulsory execution. Such issues often result in the transfer or loss of execution assets, intensifying problems of debtors lacking executable property, ultimately undermining creditors' rights.
To address these challenges, reform of separation of trial and execution is essential for establishing a well-defined, professional, and efficient enforcement team and operational framework. Since 2014, when the fourth plenary session of the 18th Central Committee proposed to “improve judicial systems and pilot reforms to ensure the fair exercise of adjudicative and execution power,” progress has been made in implementing these reforms. Initial pilots began in certain regions in early 2015, followed by broader implementation after the Supreme People's Court issued its work guidelines in 2016. However, existing studies on separation of trial and execution primarily focus on theoretical discussions rather than empirical analyses of its impact on resolving execution difficulties and creditor protection using micro-level data. This study examines the effects of this reform on trade credit using a difference-in-differences approach with Chinese listed firm data from 2010 to 2021.
The main findings of this paper are as follows: First, separation of trial and execution significantly improves firms' ability to access trade credit, particularly in upstream-supplier and downstream-customer relationships. Second, its impact is most pronounced on accounts payable financing, with greater effects observed for private, low-margin, high-credit-constrained firms, and those operating in areas with weaker credit environments or underdeveloped economies. Third, the separation of trial and execution has enhanced the execution level of accounts receivable disputes, reduced the degree of supply chain debt disputes and the provisions for suppliers' accounts receivable, improved the expected supply of commercial credit, and lowered the credit financing costs for customer enterprises.
The main contributions of this study are as follows: First, based on China's reforms, it enriches the existing literature on the judicial protection system of creditor rights and financial development from the perspective of judicial execution, providing a useful supplement to the literature that overlooks the execution process. Second, it expands the research on the determinants of judicial execution efficiency and its role in the development of the financial market from the perspective of the judicial execution system. Third, it enriches the understanding of the economic effects of China's judicial system reform since the 18th National Congress of the Communist Party of China. Fourth, it provides references for deepening the reform of separation of trial and execution and improving the national enforcement system.
The relevant policy implications are as follows: First, we should unswervingly advance the reform of separation of trial and enforcement, and effectively enhance the efficiency of legal protection for creditors' rights through judicial specialization. Second, strengthen enforcement mechanisms to improve corporate credit and support high-quality development of industrial and supply chains. Third, synchronize creditor protection legal reforms with local judicial system improvements, emphasizing systemic reform coordination for a rule-of-law business environment. These findings underscore the importance of advancing judicial reforms in fostering trade credit and promoting sustainable economic growth.

Building harmonious labor relations serves as a critical foundation for practicing a people-centered development philosophy and steadily advancing common prosperity. However, the current labor relations continue to face numerous challenges, with phenomena such as excessive overtime work epitomized by the “996” work schedule and wage arrears occurring from time to time. Notably, insufficient liquidity is a core economic factor triggering labor-capital conflicts. When enterprises face financial difficulties, they often resort to short-term measures such as cutting employee benefits and delaying wage payments, directly harming workers' rights and interests. Therefore, establishing a stable external financing environment is a key pathway to curb corporate short-termism and fundamentally enhance workers' sense of gain and happiness.
The Chinese government places high importance on improving the financial sector's capacity to serve the real economy and has made top-level design for this purpose. Among them, the initiative to build “National Pilot Cities for Industry-Finance Cooperation” is a significant systemic project. This policy aims to break down information barriers between banks and enterprises and channel financial resources more precisely and efficiently into the real economy. Unlike the traditional “from industry to finance” internalized model, industry-finance cooperation emphasizes synergy between industry and finance while preserving their respective independence. This provides a quasi-natural experiment setting to explore how financial policies influence internal corporate governance by improving the external financing environment. Can the pilot, while enhancing the alignment between industry and finance, systematically increase the willingness and capability of local companies to improve labor relations?
To examine the impact of the industry-finance cooperation pilot on corporate labor relations, the paper collects and compiles approximately 43.35 million judgment documents from the China Judgments Online from 2013 to 2021. Utilizing text mining and machine learning techniques, the paper accurately identifies labor dispute litigation data for listed company groups. Building on this, leveraging the establishment of “Industry-Finance Cooperation Pilot Cities” as an exogenous shock, the paper employs a DID (Difference-in-Differences) method to systematically evaluate the impact of industry-finance cooperation on corporate labor relations.
The empirical findings are as follows: First, the industry-finance cooperation, by guiding the financial sector to support the real economy, reduces both the number of labor relations litigation cases and the litigation amounts for enterprises, thereby contributing to the improvement of corporate labor relations. This effect is more pronounced in firms with high financing constraints, managerial myopia, and those in their growth stage. Second, boosting financing confidence, safeguarding labor rights, and strengthening standardized operations are important mechanisms through which industry-finance cooperation promotes corporate labor relations. Third, the pilot shows significant effects in reducing corporate disputes related to labor contracts, wages and remuneration, and social insurance and labor security. Fourth, improved labor relations can enhance corporate labor productivity and lower stock price crash risk. Fifth, the policy also facilitates the comprehensive improvement of labor relations within the pilot cities. These findings remain robust after a series of endogeneity and robustness checks.
This paper makes three main contributions: First, by analyzing big data on labor disputes based on judgment documents, the paper provides a new analytical perspective and a high-quality data foundation for researching corporate labor relations and the effects of policy interventions. Second, moving beyond the static perspective that simplistically attributes tensions in labor relations to institutional transition or technological shocks, the paper innovatively constructs a theoretical framework of “financial empowerment-resource release-relationship governance” from the dynamic perspective of corporates' access to financial resources. Third, drawing on textual analysis methods, the paper extracts and constructs a corporate “financing confidence” index from the “Management Discussion and Analysis” section of listed companies' annual reports. This textual measurement can more sensitively capture management's subjective expectations and sentiments regarding future financing conditions based on the current economic environment.
In summary, this paper demonstrates that the industry-finance cooperation, which operates without equity ties, not only alleviates corporate financing constraints but also, through signaling and resource empowerment, incentivizes enterprises to translate short-term financial improvements into long-term human capital investment and the construction of harmonious labor relations. The paper provides important theoretical foundations and empirical references for promoting the synergistic advancement of high-quality economic development and people's livelihoods through financial supply-side structural reforms in the new era.

As a pivotal determinant of economic and financial behaviors, household economic risk has emerged as a central concern for policymakers. At present, China's household sector confronts pronounced economic vulnerabilities, stemming from excessive reliance on labor income, insufficient social safety nets, and elevated debt-to-income ratio. Mitigating these risks is not merely a microeconomic imperative but a macro-critical precondition for bolstering the resilience of China's economic growth and advancing common prosperity. Existing studies have proved the role of constructing social credit system in alleviating household economic risk. However, the traditional social credit system has notable deficiencies in terms of development level, coverage breadth, and connection accuracy, which may impede the equitable and efficient transmission of credit benefits to all residents.
With the rapid development of the digital economy and Fintech, digital credit has restructured the traditional credit assessment system through big data, artificial intelligence, and other technologies. By using non-traditional data to replace traditional collateral, it provides financial services for those lacking credit records, becoming an important driving force for financial inclusion. The penetration of digital credit in residents' lives has led to the complexification of household economic risks. On the one hand, by enabling timely access to credit, digital credit facilitates intertemporal consumption smoothing and provides critical liquidity buffers against unforeseen shocks, thereby strengthening households' risk management capacity and reducing economic risk. On the other hand, digital credit may also lead to excessive consumption, induce excessive debt and increase fraud risks, thereby possibly increasing household economic risks. Against this backdrop, empirical investigation grounded in nationally representative microdata is essential to explore the effect of digital credit on household economic risk. Such analysis not only advances theoretical understanding of the role digital credit plays in improving household resilience but also informs broader policy goals of fostering inclusive digital credit development and sustaining household economic health.
Drawing on the 2021 and 2023 waves of the China Household Finance Survey data, this paper measures household economic risk by financial fragility and explores the potential impact and mechanism of digital credit on household economic risk. The research finds that digital credit helps reduce household economic risk, and this conclusion remains robust after considering potential endogeneity issues, alternative variable measurements, and sample selection issues. In terms of the mechanism, the liquidity support, commercial insurance participation, and expansion of income channels enabled by digital credit can effectively alleviate household economic risk. Heterogeneity analysis shows that the risk mitigation effect of digital credit on household economic risk has certain thresholds, households with stable employment, reasonable debt, high digital literacy, and high financial literacy can benefit more from digital credit. Further analysis of economic consequences indicates that the mitigation of household economic risk driven by digital credit can enhance household consumption and promote the upgrading of consumption structure.
Based on the above conclusions, this paper proposes the following suggestions:
First, the government should continue to promote the construction and digitalization of the social credit system, accelerate the social integration and sharing of credit information data, clarify the legal status and data usage boundaries of digital credit, and create a favorable institutional environment for the high-quality development of digital credit.
Second, targeted measures are needed to enhance the accessibility of digital credit services for vulnerable groups. These include delivering targeted training, refining credit scoring models, and designing inclusive financial products,which can collectively lower the access threshold of digital credit services for under-served populations. Credit repair mechanisms should also be established to support the sustainable integration of vulnerable groups into the digital credit system.

Driven by global economic integration and the wave of technological innovation, scientific and technological innovation has become the core driving force behind national economic growth and social progress. As the primary vehicle for deeply integrating financial resources with scientific and technological innovation, sci-tech innovation bonds (STIBs) play a crucial role in resolving the financing challenges of technology-based small and medium-sized enterprises (SMEs), enhancing the supportive role of patient capital in investing early-stage, small-scale and hard-technology ventures, and establishing a modern science and technology financial system commensurate with scientific and technological innovation. In traditional bond issuance, underwriters perform the functions of information intermediation, quality assurance and price discovery. By conducting due diligence on issuer information, leveraging their own market reputation to provide quality assurance for issuers, and utilizing mechanisms such as roadshows and book-building, they mitigate information asymmetry and achieve optimal bond pricing that balances the financing needs of issuers with the interests of investors. As an important financial instrument supporting the national innovation-driven development strategy, the issuance process of STIBs shares common characteristics with that of traditional bonds. However, due to the unique risk profiles of science and technology innovation enterprises, namely, their asset-light attribute, high R&D expenditure and high growth potential, underwriters are required to possess professional capabilities that go beyond the traditional intermediary role. Compared to underwriting ordinary bonds, the additional costs incurred by underwriters when underwriting STIBs include: (1) costs associated with building a specialized team; (2) procedural costs; (3) investor education costs. Against this backdrop, examining the impact of underwriting STIBs on underwriters' own development holds significant theoretical and practical importance for revealing the micro-mechanisms through which financial intermediaries serve national strategies and for optimizing the allocation of financial resources.
This paper analyses the spillover effects of underwriting STIBs on future business expansion, as well as the underlying mechanisms, from the perspective of underwriters. The study uses STIBs issued in the interbank and exchange markets between 2021 and 2024 as the research sample. The results indicate that: First, underwriting STIBs increases underwriters' market share in the underwriting of non-STIBs; this effect is more pronounced in scenarios involving sole underwriting, large-scale issues, and fundraising for hard technology applications. Second, the underwriting of STIBs generates spillover effects by signaling the underwriter's business capabilities and reinforcing its market image as a supporter of technological innovation. Third, underwriting STIBs not only helps underwriters expand their client base but also improves bond pricing efficiency.
This paper makes the following contributions: First, by focusing on STIBs, it systematically examines the role of the bond market in supporting scientific and technological innovation. It highlights the significant value of these bonds in promoting the deep integration of finance and technology and in serving the innovative development of the real economy, thereby enriching research in the field of technology finance. Second, based on data on the issuance and underwriting of STIBs, this paper systematically examines, for the first time, the pricing efficiency of STIBs and the spillover effects of their underwriting behavior, providing new insights into the impact of STIBs on underwriters' differentiated competitive strategies and market operating mechanisms. Third, this study not only refines the analytical framework for financial intermediation functions, providing theoretical support for understanding the micro-level mechanisms through which the bond market supports technological innovation, but also offers important empirical evidence for regulatory authorities to improve the development of the STIB market and for underwriters to optimize their business strategies. It thus holds positive practical significance for promoting the deep integration of finance and technology.
This paper puts forward the following policy recommendations. First, vigorously develop STIBs, broaden the scope of issuers, improve risk-sharing mechanisms, and encourage long-term capital such as insurance funds and pension funds to invest in these bonds, thereby providing a stable source of funding for science and technology innovation enterprises. Second, promote the professionalization of bond underwriting and guide underwriters to build differentiated competitive advantages. Refine the specialized evaluation system for the underwriting of STIBs, incorporate the underwriting of such bonds into the assessment of financial institutions' sci-tech finance services, and enhance underwriters' willingness to underwrite science and technology innovation projects. Strengthen the intermediary responsibilities of underwriters in the identification of science and technology innovation attributes, information disclosure, and post-issuance management. Third, improve the regulatory incentive and coordination mechanism. Provide positive incentives in areas such as regulatory ratings and business approvals to institutions that demonstrate outstanding performance in the underwriting of STIBs, while increasing regulatory accountability for institutions that fail to conduct adequate due diligence during the bond's life cycle. By applying both incentives and constraints, the enthusiasm of financial institutions to serve scientific and technological innovation will be mobilized.

In the context of the deepening registration-based IPO reform, capital markets have imposed higher demands on information disclosure quality and intermediary performance. As the pivotal intermediary in the IPO process, sponsors operate across the entire issuance chain. How to incentivize them to exercise due diligence and effectively fulfill their gatekeeping role, thereby safeguarding the integrity of the IPO review process and enhancing the efficiency of resource allocation, remains an important yet underexplored question.
To strengthen oversight of sponsors, the stock exchange has introduced the IPO on-site supervision system since 2019. Under this system, the stock exchange conducts on-site inspections at sponsors’ offices for IPO projects that present material concerns or elevated risks. Supervisory teams examine working papers, review supporting evidence, and interview relevant practitioners to verify ambiguous or questionable information. Through these inspections, the IPO on-site supervision system aims to reinforce sponsors’ gatekeeping role, enhance the reliability of issuers’ disclosures, and ultimately improve the overall quality of IPO companies.
Theoretically, the IPO on-site supervision system may influence sponsor behavior through two mechanisms. First, by increasing the costs of misconduct, it generates a deterrence effect that prompts sponsors to perform due diligence more prudently in subsequent IPO projects. Second, through regulatory feedback and accumulated practical experience, it induces a learning effect that motivates sponsors to optimize internal processes and strengthen professional capabilities. These mechanisms may operate either independently or in tandem, thereby enhancing sponsors’ practice quality.
However, due to the non-public nature of the IPO on-site supervision list, the existing literature has yet to systematically examine whether and how this regulation affects sponsors’ professional conduct. To address this gap, we manually construct a dataset on IPO on-site supervision from 2019 to 2023 by combining textual analysis of review inquiry response letters, publicly available information, and interviews with sponsors. Focusing on IPO firms listed on the STAR Market and the ChiNext Market under the registration-based system, we investigate how the IPO on-site supervision system affects sponsors’ practice quality in IPO projects.
We document several main findings. First, IPO on-site inspections generate significant governance effects, improving sponsors’ performance in subsequent IPO projects. This improvement is reflected in higher quality disclosure in initial prospectus filings, reduced intensity of first-round exchange inquiries, and enhanced quality of sponsors’ responses. Second, mechanism tests indicate that both deterrence and learning channels underpin these effects. Third, analyses across different types of inquiry items show that inspections significantly reduce questions related to disclosure completeness and business compliance, while having a more limited impact on accounting and financial reporting issues. This pattern suggests that the primary effect of inspections lies in strengthening sponsors’ verification and due diligence functions. Fourth, cross-sectional analyses reveal that the governance effect is more pronounced among sponsors with lower profitability. In addition, the implementation of the revised Securities Law in March 2020 substantially increased legal liabilities and violation costs for sponsors, exerting a broad impact on sponsors. Consistent with this change, the governance effect of on-site inspections is more pronounced before the implementation of the revised law.
This study contributes to the literature in several ways. First, our study is the first to systematically examine the economic consequences of the IPO on-site supervision system, revealing its governance effects and extending the literature on penetrative supervision. Second, our study enriches research on the determinants of sponsors’ execution quality in IPO projects through the lens of external regulation. Third, by analyzing both regulatory pressure and learning effects, our study explores how the IPO on-site supervision system shapes sponsors’ behavior and provides new empirical support for their behavioral logic in capital markets. Our study also offers important practical implications by demonstrating the effectiveness of penetrative supervision in disciplining intermediaries and informing the design of regulatory frameworks governing the IPO process.