Suppliers’ bargaining power mainly comes from their market position or top supplier status. However, it is also affected by the horizontal competition from top supplier size homogeneity based on the purchasing proportion of a buyer. Using a sample of listed companies in China, we find an inverted U-shaped relationship between the supplier size homogeneity with shared customers and trade credit provisions. As size homogeneity increases, suppliers may increase (decrease) trade credit provision to expand sales (for cash income). That is, based on the degree of supplier size homogeneity, the homogeneity may strengthen or weaken the supplier competition effect. We also find that if upstream and downstream firms have associated relationships, or if the business environment is poor, the competition effect from supplier size homogeneity is not obvious, whereas the weak financing ability of buyer promotes the supplier competition. In addition, the competition effect from supplier size homogeneity is not observed in state-owned firms.

Starting from the change in decision-makers’ risk attitude, which suggests “an increase in risk leads to a heightened tendency for risk aversion”, this study explores the nonlinear relationship between idiosyncratic risk and corporate cash holdings. Empirical analysis results indicate that, with the enhancement of decision-makers’ risk-averse degree, the marginal increase in corporate cash holdings presents an upward trend as idiosyncratic risk rises. Associated with the changes in managers’ risk attitude, the nonlinear relationship between idiosyncratic risk and corporate cash holdings becomes insignificant when the firm purchases directors’ liability insurance or is located in regions with better business environments. However, if the executives are older or hold academic titles, the increase in corporate cash holdings with the rise of idiosyncratic risk is more rapid.

In China, inadequate levels of cross-regional investment represent a challenge. Our study uses the bailout reform initiated in China in 2014 to test whether market-oriented reforms of this type can help stimulate national economic integration. We observed that following a bond default event, nonlocal listed firms tend to establish a higher proportion of subsidiaries in the province where the default occurred. This phenomenon can be attributed to China’s bailout reform signaling a reduction in local protectionism in financial and product markets. Meanwhile, we found that the effects of bond defaults on cross-regional investment are more pronounced under the following conditions: when the impact of the bond default is greater; when the economic and fiscal conditions of the province where default occurs are better; when local protectionism in the home province is higher; and when the degree of asset specificity of the listed firms is lower. Finally, we found that China’s bailout reform has led to positive economic consequences, including reduced operational risks and improved total factor productivity (TFP) of firms. Overall, our paper supplements the literature on bond defaults and cross-regional investment.

We incorporate econometrics approach into panel data methods to examine the impact of the board competence on the performance in Chinese banks. By investigating the biographical background of directors in the 20 largest banks during the period 2008 to 2016, our estimate shows that the board of directors play a prominent role in the performance. Especially, both the education background and the management experience have negative impact on the performance.

This study finds that reducing political influence over local courts weakens local government debt capacity. We establish this result by exploiting the staggered roll-out of a judicial centralization reform aimed at alleviating local court capture in China and find reduced judicial favoritism towards local governments post-reform. The majority of local government lawsuits are with contractors over government payment delays. The reform not only increases government lawsuit losses but also exposes their credit risk, as payment delays without court support signal government liquidity constraint. Investors respond by tightening lending and increasing interest rates, which curbs government spending.

This paper models the effect of corporate information preference on stock return volatility based on optimization problems of information decisions for firms and investors. Our model hypothesizes a positive correlation between corporate information preference and volatility. Utilizing the ideal institutional background of the Chinese stock market, we empirically confirm that corporate information preference has a positive impact on volatility, particularly for firms facing more severe financial distress, limited investor attention, and fewer analyst coverage. Our study provides a new perspective for analyzing the interaction between information supply and asset price dynamics.

We examine the impact of firm-investor communication on ESG issues through investor interactive platforms in Chinese stock exchanges from 2010 to 2022. Our regression analysis finds that increased ESG-based questions from investors and firms’ responses lead to increased stock liquidity, suggesting that investor-firm dialogues beyond financial aspects to include ESG-related themes contribute to greater information transparency. We posit that investors use such communication as a “voice” strategy, advocating firms for enhanced ESG disclosures and performance. This strategy yields a two-fold benefit: it aligns with investors’ ESG objectives and, alternatively, facilitates their exit through improved stock liquidity. Our robustness tests suggest a probable causal relationship between investor engagement on ESG issues and stock liquidity. Moreover, we find that a positive tone in ESG-based communications strengthens this relationship, prompting managers to enhance ESG disclosure transparency in response to investor pressure.

Using a comprehensive factor zoo, we document a notable factor MAX premium in the Chinese market. Factors with high maximum daily returns consistently outperform those with low maximum returns by 0.82% per month in the future, on a risk-adjusted basis. This premium remains robust controlling for various factor characteristics, and is not sensitive to the selection of factors. The factor MAX anomaly stands apart from lottery-type stock anomalies and contributes to elucidate most of these anomalies. The factor MAX premium concentrates in high-eigenvalue principal component factors, shedding light on the prevalent lottery preferences for factor investing in China’s A-share market.

Using official information published by Central Commission for Discipline Inspection (CCDI) of the CPC, we construct a database of officials who have been found guilty of corruption in China in the period 2012-21 with their personal characteristics and the amount of embezzled funds. We use it to investigate the correlates of corruption, estimate the effects of corruption on inequality, and find the expected increase in officials’ income due to corruption and the gain in income distribution ranking. We find that the amount of corruption is positively associated with education, administrative (hierarchical) level of the official, and years of membership in the Communist Party. The sample of corrupt officials belongs to the upper income ranges of Chinese income distribution even without corruption. But corruption is a significant engine of upward mobility. While only one-half of the corrupt official would be in the top 5 percent of urban distribution without illegal incomes, practically all are in the top 5 percent when corrupt income is included.

In the context of promoting high-quality economic development, using digital technology to empower industrial transformation and upgrading, thus driving consumption growth has become a key problem that needs to be solved urgently. By using data at the prefecture-level cities in China from 2011 to 2020, the paper has discussed the influence of the digital economy on residents' consumption and its internal mechanism. Theoretical analysis and empirical test results have shown that first of all, the digital economy has significantly improved residents' consumption, and this conclusion is still valid after the endogenous test and robustness test. Secondly, mechanism analysis has shown that the digital economy can increase residents' consumption by promoting the upgrading of the industrial structure. Thirdly, the promotion effect of the digital economy on residents' consumption is heterogeneous between urban and rural areas and between different regions. Compared with urban, and eastern and central regions, the digital economy has a more significant incentive for residents' consumption in rural areas and western regions, indicating that its development is beneficial to narrowing the gap of consumption between urban and rural areas and between regions. Finally, the improvement effect of the digital economy on residents' consumption has marginal increment nonlinear characteristics, which is continuously strengthened with the upgrading of industrial structure. The above research conclusions can provide a theoretical basis for further improving the infrastructure of the digital economy, accelerating the integration of the digital economy with traditional industries, and building a consumer Internet.