This paper estimates country-level quality for each tradable good using Feenstra and Romalis (2014) approach and provides empirical evidences that: 1) judicial quality is positively associated with average export quality, but a country with higher judicial quality does not exhibit comparative advantage in exporting contract-intensive goods in terms of quality; 2) a country with higher judicial quality does exhibit comparative advantage in importing contract-intensive goods in terms of quality; 3) importer’s judicial quality is a key determinant of relative quality of trade for contract-intensive goods, while exporter’s judicial quality is more relevant for relative quantity of trade for contract-intensive goods.

With respect to enterprises' outward foreign direct investments (OFDI), could bilateral political relationships have a complementary effect on institutional environment of host countries? Existing Literature does not place enough emphasis on the interactions between bilateral political relationships and institutional environment of host countries. This paper constructs a set of related indexes such as Bilateral Political Relationship and Differences with Host Country InstitutionalEnvironment, based on data of China's enterprises'OFDIfrom 2005 to 2014. The paper makes several important findings through empirical analysis. Firstly, amicable bilateral political relationship has a complementary effect on institutional environment of host countries, which boostsenterprises' OFDI; on the contrary, bilateral political conflicts lead toa deterioration effect on OFDI. Secondly, on either formal or informal institutional environment, amicable bilateral political relationship has a complementary effect by reducing institutionalobstacles in the host countries. Thirdly, the complementary effectbetween amicable bilateral political relationship and institutional environment of the host countriesalso promote the profits of enterprises' OFDI. Fourthly, the complementary effect is more significant in host countries with poor institutional environment. Based on the above analysis, in theimplementation of“the Belt and Road” strategy, Chinese government needs to strengthen relationship with host countries, in particular communicating with countries whose institutionalenvironment is diverse from China; meanwhile, it is also curialfor enterprises to build their own competitiveadvantages and ensure profits from outward investment.

We investigate the response of Chinese investment to oil price uncertainty shocks, using quarterly macro data spanning the period 2000-2015 and annual micro survey data over the period 1998-2007. The macro structural VAR analysis reveals that uncertainty shocks to oil prices inhibit aggregate investment in the short run and account for around 12% fluctuations in fixed asset investment. In the micro level, we initiate a new computation method for firm investment using heterogeneous firm-level depreciation rate. The panel-data VAR evidence shows that uncertainty shocks to oil prices hinder firm investment in the short run for private and foreign firms, yet not significantly affecting state-and collectively-owned firms. We also find that the results are more pronounced when we allow for more heterogeneity in depreciation rate to compute firm investment. Further exploration suggests a more policy-oriented feature for investment of state-and collectively-owned firms, which explains its unresponsiveness to oil price uncertainty shocks.

This paper intends to provide a new insight to understand why migrant workers in China have a low consumption rate. We focus on the effects of social comparison, or relative income, on household consumption rate. The survey data of Rural-to-Urban Migration in China from 2008 to 2009 was used to identify the relative comparisons among migrant workers, urban residents, and rural residents. We decompose relative deprivation index into relative income ranking and income inequality, and explore their impacts on household consumption jointly. On one hand, relative income ranking leads to conspicuous consumption motivation at present; on the other hand, this motivation is mitigated when relative income increases. Our results imply that households with lower relative income tend to consume more proportionally, while rise in inequality among migrant workers or urban residents can lower the current consumption rate of migrant workers, particularly for the poorer ones. Low relative income compared to urban residents will decrease current consumption, and this effect is especially strong for migrant households who intend to stay in the city in the long-run. Also, our result has significant policy implication that wage gap between urban and rural areas will curb the consumption in the long run.

Based on unbalanced panel data of commercial banks in China over the year of 2004 to 2014, this paper analyzes the effect of capital quality on bank lending behavior. The empirical analysis yields the following results: (1) capital adequacy ratio inhibits bank loans, while core capital adequacy ratio has the positive effect on bank lending. Both the effect is enhanced during the financial crisis, but is weakened during the Basel III regulation expected period. Leverage ratio really increases the caution of bank lending during Basel III regulatory expected period. (2) For loans structure, personal loans’ growth rate is more sensitive to the capital quality than the corporate loans’. Leverage ratio can support the banks issue corporate loans effectively during the financial crisis. (3) For industry loans, if banks have high core capital adequacy ratio, their real estate loans’ growth is lower but manufacturing loans’ growth is higher, and this preference reduces during the financial crisis and Basel III regulation expected period.

How to effectively solve the financing difficulty of small and medium-sized enterprises (SMEs) is an issue of common concern in academic and practical circles. Based on China industrial dataset, this paper investigates whether the development of small and medium-sized banks (SMBs) helps to mitigate SMEs’ financing difficulty. This paper further analyzes the mediator effects through which SMBs’ development mitigates SMEs’ financing difficulty based on multiple mediation models. We find that, SMBs’ development can effectively narrow the gap of loan financing between SMEs and big companies, and can mitigate the negative impact of tight monetary policy on SMEs’ loan financing as well. This paper further compares two channels (improving financial development channel and optimizing banking structure channel) through which SMBs’ development mitigates SMEs’ financing difficulty. We find that, improving financial development channel is more important than optimizing banking structure channel. Our research has an important reference value to mitigate SMEs’ financing difficulty.

This paper introduces a two-period OLG model which encompasses heterogeneous households and risky markets with different participation costs, it discusses the wealth effect of households’ risky asset allocation under different participation costs. Based on the Oaxaca-Blinder decomposition method, this paper utilizes CHFS 2011 data to prove the prediction of the model: from low wealth level, households first prefer indirect participation in risky asset, and will increase their direct participation as households’ wealth accumulates.

Financial literacy has been widely proved to be related with various individual financial behavior and people with higher level of financial literacy tend to behave better in financial markets. In this paper, using income transition matrix and Probit model, we look at how financial literacy will eventually work on micro income mobility. Our results show that families with higher level of financial literacy possess higher probability of upward income mobility. As our daily life tends to get more and more involved with the capital markets, our findings provide a brand-new but promising angle for micro income mobility research.

This paper focuses on the 18^th document in 2013 issued by the Organization Department of the Central Committee of the CPC, and analyzes the potential impact on stock prices of listed companies caused by the consequent resignations of politically-connected independent directors. This paper works on 312 samples of independent director resignations after the issue of the document, and finds that (1) Private firms that hire politically-connected independent directors have higher dividend payout ratio, ceteris paribus, which implies that the politically-connected independent directors not only provide the political resources but also improve the level of investor protection; (2) It did impair the market value of companies, especially for those private enterprises, the first time a resignation announcement was explicitly related to the 18^th document.Our findings show that firms obtain political resources by hiring politically-connected independent directors,while politically-connected independent directors urge firms to follow the capital market rules,which improves the level of investor protection.

In this paper, we test the cross effect of local bias and investor sentiment on stock markets. Text messages posted by investors are downloaded from an online stock forum in China. We build the Investor Sentiment Index based on the message content and the Local Bias Index based on their IP address. The empirical results show that the effect of Local Bias Index on stock market depends on the investor sentiment. As the investor sentiment is positive (negative), there is a positive (negative) effect of local bias on the relevant stock return. Besides, local bias positively affect stock trading volume and this effect is greater as the investors are optimistic than as they are pessimistic. Besides, the cross effects of local bias and sentiment on stock market are similar across five different regions with more than 20 list firms each. However, these effects are not significant and consistent in regions with less list firms.

With the unique data of China's independent directors ,this paper studies the relationship between the independent director said “no” and the reelection of the future. The results showed that issued a adverse opinion of the way sometimes than adverse opinion itself more important; even the same whether qualitative opinion, but if for the different matters, independent director future reelection possibilities are also different. Generally speaking, clear issued objections, against internal opposition matters, as well as collective said “no” independent director future re-election less likely. Therefore, the regulatory authorities should be reminded to provide more clear guidelines for the relevant legal risks.

In recent years, supply chain finance has been brought under the spotlight in both academia and industry. With the launch of One Belt, One Road Initiative, a number of companies in China are planning to sell their products their foreign counterparts, and success of the scheme relies upon the proper implementation of supply chain finance. But they are facing financial constrain of buyers widely. In this paper, a novel buy back financing scheme is introduced. We calculated the optimal order quantity under such novel financing scheme, and compare its efficiency to other commonly used financing scheme like commercial loan and trade credit. We demonstrate that the buy back financing scheme outperforms the two financing schemes and can greatly enhance the efficiency of the supply. This is very important to cut overcapacity and excess inventory.

This paper examines the impact of supply chain information on 2007-2012 Chinese-listed firms’ information environment, measured by stock price synchronicity. We find that disclosing large customers’ identities provides an important channel for investors to learn about the firm, which leads to a lower stock price synchronicity in disclosing firms. However, firms with disclosed customers being publicly listed are associated with higher stock price synchronicity than those with customers not publicly listed. We conjecture and find that it is driven by more low-cost and public available information sharing among industry level. Moreover, the effect is stronger when the customers are more concentrated, followed by more analysts, and have greater industry influence. The overall results show that the disclosure of customer information provides an extra channel for investors and improves information environment of capital market.