This study investigates the role of contextual cues in memory-based decision-making within high-stakestrading environments. Using trade records from a large Chinese brokerage firm and a novel dataset on COVID-19 quarantines, we find that quarantine periods trigger the recall of previously traded stocks, increasing the likelihood of subsequent orders for those stocks. The observed patterns align more closely with similarity-based recall than with alternative channels. Welfare analysis reveals that these memory-induced trades lead to an annualized loss of approximately 70 percentage points for the representative investor’s portfolio. We also find evidence at the market level: when the geographical distribution of quarantine risks is recalled, the probability of recalling the cross-sectional stock return-volume distribution from the same day increases by 1.6 percentage points. This study provides causal evidence from a real-world setting for memory-based theories, particularly similarity-based recall, and highlights a novel channel through which COVID-19 policies affect financial markets.

This paper investigates how foreign institutional investors, specifically Qualified Foreign Institutional Investors (QFIIs), influence the investment strategies of Chinese mutual fund management companies (FMCs) in which they hold shares. By analysing panel data from 1,766 mutual funds managed by 44 foreign-invested FMCs in China between 2005 and 2021, we explore whether QFII-invested FMCs (Q-FMCs) learn more from their domestic counterparts (D-FMCs) than other foreign-invested FMCs (NQ-FMCs). Our findings show that Q-FMC-managed mutual funds exhibit portfolio allocations more closely aligned with local DFMCs than those managed by NQ-FMCs. This imitation is particularly pronounced when selecting new stocks, enhancing portfolio performance, but not when rebalancing existing positions. Additionally, Q-FMCs trade more actively than NQ-FMCs. Robustness checks confirm these results across various ownership structures, fund characteristics, market conditions, and regulatory changes. These findings highlight the dual role of QFIIs as both investors and learners in China’s evolving financial landscape, offering insights into how foreign capital integrates into emerging mutual fund markets, informing regulatory policy aimed at fostering cross-border financial development.

We exploit a unique financial regulatory tool with data-governance functions as a quasi-natural experiment to explore the determinants of bank risk-taking. The paper finds that Examination Analysis System Technology (EAST) reduces bank risk-taking. This result is more pronounced in banks with higher capital adequacy ratios and higher liquidity levels. We also find that the inhibitory effect of EAST on bank risk is more significant for banks in eastern regions and listed banks. Our findings highlight the positive impact of data regulation on promoting financial stability.

在实现“双碳”与共同富裕目标并进的背景下，环保规制的公平后果日益受到关注。本文以2013、2014与2016年分批启动的碳排放权交易试点为准自然实验，基于2000—2023年中国区县面板数据，系统评估市场型环保规制的分配效应。结果变量方面，本文使用区县夜间灯光构建的不平等指标（基尼、泰尔、阿特金森）刻画县域经济活动分布，并以县域城乡居民收入对数差距作为补充。识别策略方面，除区县与年份双向固定效应的TWFE-DID外，进一步引入适用于分批采用的更强识别方法：（1）Sun-Abraham分组事件研究用于动态效应检验并规避传统事件回归在异质处理效应下的加权偏误；（2）Callaway-Sant’Anna ATT(g,t)在“尚未受处理/从未受处理”对照组框架下估计分组—时期平均处理效应；（3）合成双重差分（SDID）同时估计单位权重与时间权重，以匹配处理前趋势并降低对严格平行趋势的依赖。研究发现：在TWFE-DID下，试点显著降低了县域夜间灯光基尼与阿特金森指数；更强识别（ATT(g,t)、SDID）在城市层面同样指向夜间灯光泰尔指数的下降，但幅度更为温和。机制检验表明，试点显著降低城市单位GDP能耗，支持“绿色转型—要素再配置—分配格局改善”的作用链条。

The flow-performance relation in China’s mutual fund market differs from that in developed markets (e.g., the U.S.). We find that investors actively allocate capital to poorly performing funds, generating a negative relation at the bottom of return distribution. These flows are driven mainly by increased purchases rather than reduced redemptions. We then examine the mechanisms behind this anomaly. First, investors act on rational expectations of performance reversals, with this pattern being more pronounced among funds with higher activeness. Second, product differentiation attracts heterogeneous investors when performance is weak. Third, marketing and fund family effects serve as simple signals that amplify inflows. Overall, our study provides new empirical evidence on fund investor behavior and its economic consequences in an emerging market context.

We introduce a real-time dispersion measure based on cross-sectional stock returns explicitly designed to capture retail-driven speculative episodes. Elevated return dispersion effectively identifies periods characterized by intensified retail investor trading behaviors, driven by salience, diagnostic expectations, and extrapolative beliefs. During these high-dispersion states, momentum strategies collapse, and short-term reversals become dominant. Conditioning momentum strategies on our dispersion measure resolves the longstanding puzzle of missing momentum in retail-intensive markets such as China, substantially enhancing profitability. A dynamic rotation strategy between momentum and short-term reversal portfolios guided by dispersion states achieves annualized Sharpe ratios nearly double those of static approaches. Extending our analysis internationally, we employ Google search trends as proxies for retail investor attention, confirming that dispersion robustly predicts momentum and reversal returns globally. Our findings underscore the behavioral channel through which retail-driven speculation conditions momentum dynamics, providing clear implications for dynamic portfolio management strategies.

This study theoretically and empirically examines the impact of intangible capital on firm markups. The current research follows Altomonte et al. (2021) and first establishes a theoretical framework of intangible capital affecting firm markups. Accordingly, this study finds that an increase in intangible capital results in an increase in firm markups via the “production efficiency” channel but a decrease in firm markups via the “market-based pricing” channel. We use the data of Chinese manufacturing firms to further empirically study the influence of intangible capital on firm markups and its influencing mechanism. After a series of robustness and endogeneity tests, this research finds that intangible capital is conducive to increasing firm markups. Results of the empirical analysis also reveal that the positive impact of an increase in intangible capital on the markups of Chinese manufacturing firms via the “production efficiency” channel are higher than the negative impact of an increase in intangible capital via the “market-based pricing” channel. Moreover, the impact on the markups of different types of firms are not the same, with significant heterogeneity characteristics. This study provides micro evidence from a large developing country on how intangible capital affects the change in firm markups, thereby providing a new perspective on the economic effects of intangible capital.

We develop a deep-visualization framework for timing the factor zoo. Historical factor return trajectories are converted to two complementary image representations, which are then learned by convolutional neural networks (CNNs) to generate factor-specific timing signals. Using 206 equity factors, our CNN-based forecasts deliver significant economic gains: timed factors earn an average annualized alpha of about 6\%, and a high-minus-low strategy yields an annualized Sharpe ratio of 1.22. The outperformance is robust to transaction costs, post-publication decay, and factor category-level analysis. Interpretability analyses reveal that CNNs extract predictive signals from path boundaries and regime shifts, capturing patterns orthogonal to investor attention.

This paper examines how China allocates its newly accumulated foreign assets by analyzing the long-run relationship between net national savings, foreign exchange reserves, and outward direct investment (ODI). Using quarterly data from 2005 to 2023, a cointegrated vector autoregression framework shows that ODI—particularly through state-owned enterprises— has emerged as an important channel for recycling national savings abroad. Although short-run reserve fluctuations persist, sustained reserve accumulation has become less central to China’s external asset management. This study contributes to the literature by highlighting the institutional role of state ownership in shaping cross-border investment patterns and by identifying ODI as a strategic mechanism for channeling national savings internationally. The findings shed new light on China’s evolving approach to external asset allocation and its broader economic and geopolitical implications.

This study examines the economic consequences of China’s Three-Red-Lines policy, introduced in 2021 to cap real estate developers' leverage by imposing strict thresholds on debt ratios and liquidity. Developers breaching these thresholds experienced sharp declines in financing, land acquisitions, and financial performance. Privately owned developers(POE) are hit harder than state-owned firms (SOE), with larger drops in sales and higher default risk. Using granular project-level data, we show that the policy reduces developer sales primarily by curtailing new-project supply: breached developers launch fewer projects. On the demand side, homebuyers reallocate purchases from privately owned developers to SOEs, further widening the POE-SOE gap. The policy also reduced local governments’ land-transfer revenues and increased reliance on local government financing vehicles (LGFVs) for land purchases. These LGFV-acquired parcels exhibit very low subsequent development rates, which may increase local governments’off-balance-sheet debt risks.