This paper explores the widespread perception of insurers as bad payers, often accused of unjustly rejecting legitimate claims. We explore the mechanisms leading to this negative image by examining the strategic “nitpicking” behaviour of insurers. Such behaviour involves an insurer’s effort to find evidence that can help it cut the indemnities of honest claims. Our findings reveal that this nitpicking behaviour only arises in markets with asymmetric information, where policyholders are unable to observe insurers’ nitpicking strategies. Conversely, in markets with symmetric information, insurers lose the incentive to engage in nitpicking. Moreover, our study highlights that nitpicky behaviour leads to a reduction in welfare and Pareto-inefficiency. This is because nitpicking is essentially an overpriced gam- ble that charges lower premiums from policyholders at a no-loss state, but cuts actual indemnities received by policyholders at a loss state.

Emissions data collection and management are crucial to operationalizing an emissions trading scheme (ETS). Regulators need high-quality data to allocate emissions allowances and monitor compliance. However, collecting such data can be costly, challenging various actors. Emitters may misreport data, weighing the cost against their interest, while governments may struggle with limited resources in managing compliance. Third-party verification is a solution but tends to be ineffectual and causes new problems unless with sufficient oversight and support. This quality-cost dilemma becomes even more complex in multi-level ETSs, as in China’s national ETS (NETS). Despite increased regulatory efforts to address data challenges, there remains a lack of in-depth legal analysis on the relationship between data quality and cost. This Article establishes a three-element analytical framework—data quality, cost concerns, and intergovernmental relations in data management—to shed light on the nuances of data regulation. Using China’s NETS as a case study, we gain a deeper understanding of the three elements in a specific jurisdiction and the legal institutions, practices, and challenges involved. Governments, emitters, and third-party verifiers each have unique roles and limitations in this process. We suggest legal and regulatory strategies for finding solutions. Our actor-centered analytical model and practical recommendations for the NETS can serve as a valuable guide for jurisdictions facing similar data challenges.

Despite the lack of electoral accountability, China has built an expanding welfare system that is set to include most citizens. Why does China defy the conventional prediction of an exclusive autocratic welfare state? This paper looks at the critical time when China first established its social security system in the 1990s and argues that the state adopts a “demand-driven strategy” where the redistribution effort varies with the expected collective action of economic losers. Analyzing an original granular county-level dataset of China’s laid-off workers and social security taxation, the paper finds that a group of newly-emerged economic losers, precipitated by state policy, drives the local states’ efforts to redistribute. In particular, the number of laid-off state-owned enterprise workers explains 46% of the variations in social security collection among non-state-owned enterprises. Instrumental variable estimation, with legacy state-owned enterprises established in historical contingencies as the instrument for laid-off workers, shows consistent results. Further analysis on mechanisms demonstrates that layoffs lead to an increase in SOE protests, which in turn foster greater redistribution.

This article delves into the imperative shift from diversity to true equity in organizations, emphasizing the pivotal role of inclusive leadership. It traces the evolution of diversity and inclusion efforts, elucidates the essence of inclusive leadership, and underscores the compelling business case for achieving equity. The article elucidates the attributes and behaviors of inclusive leaders and provides strategies for overcoming challenges in implementing inclusive leadership. Additionally, it offers a structured framework for leaders to develop and refine their inclusive leadership skills. Case studies of organizations that have successfully embraced inclusive leadership are presented as inspirational exemplars. The conclusion highlights the transformative potential of inclusive leadership and urges readers to take actionable steps towards becoming inclusive leaders. Resources for further learning and development are provided, concluding with a powerful call to action, emphasizing the profound positive impact of inclusive leadership on individuals, organizations, and society as a whole.

This paper uses the IV-2SLS model to explore the impact of analyst attention on firms' internal and external innovation paths from a dynamic perspective of the life cycle. When firms are in the growth stage, the higher the analyst attention, the more firms will significantly increase their internal R&D efforts and make active technology acquisitions; As firms enter maturity, analyst attention plays a role in promoting R&D investment and corporate venture capital activities; When enterprises are in the recession period, firms are more inclined to innovate independently under the influence of analyst attention. This bias is more significant in non-state enterprises and high-tech enterprises. Further study finds that the interaction between analyst attention and firms' innovation path under different life cycles effectively enhances innovation output.

We investigate whether and how environmentally inclined politicians (EIPs), i.e., politicians with prior environment-related work experience, affect local environmental performance in China. We find that firms located in cities with EIPs have lower levels of sulfur dioxide (SO2) emissions. The effect is attenuated when the politician is in his/her second term and among firms that are economically important. Firms in cities with EIPs commit fewer environmental violations, receive more green subsidies from the local government, and choose to establish new polluting subsidiaries in cities without EIPs. We also find that the economic performance of cities governed by EIPs is not statistically different from that of cities governed by non-EIPs. Furthermore, the promotion likelihood of EIPs is negatively related to local emission levels. The findings overall suggest that local officials strategically leverage their expertise in environment protection to allocate more effort on environmental causes.

This paper examines how globalization process shapes the corporate ESG efforts in emerging markets. Using a staggered difference-in-difference model based on the gradual inclusion of China's A-shares in the MSCI index, we find that public companies improved their ESG performance and disclosure quality after being included. The results are robust to propensity score matched sample. Notably, the impact on ESG disclosure was significantly greater than on ESG performance, and the effect is more pronounced for non-SOEs and firms with weak governance. The inclusion also leads to significant increasesin foreign holdings, the proportion of women directors, and analyst attention, which have promoting effects on corporate ESG performance and disclosure ratings. This study sheds light on the macro-level determinants of corporate ESG engagement.

This paper examines whether sell-side analysts struggle to cope with macroeconomic uncertainty. We find that analysts issue more accurate earnings forecasts when facing higher economic policy uncertainty, which conflicts with the conclusions in the US. We provide a novel explanation for this finding and exclude the view that forecast accuracy improvement comes from analysts’ efforts to actively collect private information through site visits. Further evidence supports that heuristic cognitive bias and emotional framing effect hold back analysts’ tendency to optimism in China, resulting in higher forecast accuracy. As to why Chinese analysts do not work harder but issue more accurate forecasts, we suggest that it is mainly due to the different market regimes faced by analysts in the two countries. Our study sheds light on how macroeconomic uncertainty affects analysts’ unethical behavior and explains the cognitive processes involved.

We conducted a nationwide field experiment in China to evaluate the direct and indirect impacts of assigning firms to public or private citizen appeals treatments when they violate pollution standards. There are three main findings. First, public appeals to the regulator through social media substantially reduce violations and pollution emissions, while private appeals cause more modest environmental improvements. Second, experimentally adding “likes” and “shares” to social media appeals increases regulatory effort, suggesting visibility as an important mechanism. Third, treatment pollution reductions are not offset by control firm increases, based on randomly varying the proportion of treatment firms at the prefecture-level.

Subjective performance evaluation is widely used by firms and governments to provide work incentives. However, delegating evaluation power to local leadership could induce influence activities: employees might devote too much effort to impressing/pleasing their evaluator, relative to working toward the goals of the organization itself. We conduct a large-scale randomized field experiment among Chinese local civil servants to study the existence and implications of influence activities. We find that civil servants do engage in evaluator-specific influence to affect evaluation outcomes, partly in the form of reallocating work efforts toward job tasks that are more important and observable to the evaluator. Importantly, we show that introducing uncertainty about the evaluator’s identity discourages evaluator-specific influence activities and improves bureaucratic work performance.