Using data from Chinese A-share listed firms from 2015 to 2022, a difference-in-differences model is employed to empirically examine the impact of bankruptcy regimes, marked by the establishment of the bankruptcy court, on firms’ total factor productivity (TFP). The results show a significant decline in TFP among firms in regions following the establishment of the bankruptcy court. This result remains valid after a series of robustness tests. Mechanism tests reveal that bankruptcy court heightens firms’ risk aversion by endowing excessive rights to creditors. Consequently, firms tend to downwardly adjust capital structure, curtail innovation investment, and accumulate liquid assets as coping measures, ultimately contributing to a decline in TFP. However, well-developed market mechanisms can alleviate the negative impact of bankruptcy court excessively protecting creditors. Specifically, when firms are located in regions with weak government intervention and strong financial development, as well as in market environments with low uncertainty and strong competition, this negative impact can be mitigated. Moreover, we find that under bankruptcy court operations, while a series of risk reduction measures taken by firms triggers a decline in TFP, it mitigates the risk of financial distress. These findings provide fresh insights into the dual nature of creditor protection and offer valuable references for governments to improve the bankruptcy legal system.

The implementation of prefabricated housing (PH) has become prevalent in China recently because of its advantages in improving production efficiency and saving energy. However, the benefits of adopting PH cannot always be accrued by the stakeholders because of the arising transaction costs (TCs) in the projects’ development process. This study investigates the strategies for developers to make rational choices for minimizing the TCs of the PH project considering their own attributes and external constraints. A Bayesian Belief Network model was applied as the analytical method, based on the surveys in China. The single sensitive analysis indicated that developers influence the TCs of PH through the three most impactful factors: Prefabrication rate, PH experience, and Contract payment method. Furthermore, combined strategies were recommended for developers in various situations based on the multiple sensitivity analysis. Developers facing high prefabrication rate challenges are suggested to reduce the risks by procuring high-qualified general contractors and adopting unit-price contracts type. For developers with limited PH experience, adopting the Engineering-Procurement-Construction procurement method is the most efficient in reducing their TCs in the context of China’s PH market. This study contributes to the current body of knowledge concerning the effect of traders’ attributes and choices on TCs, expanding the application of TCs theory and fulfilling the study on the determinants of TCs in construction management.

Our study explored the rise of public companies competing to launch large language models (LLMs) in the Chinese stock market after ChatGPTs' success. We analyzed 25 companies listed on the Chinese Stock Exchange and discovered that the cumulative abnormal return (CAR) was high up to 3% before LLMs' release, indicating a positive view from insiders. However, CAR dropped to around 1.5% after their release. Early LLM releases had better market reactions, especially those focused on customer service, design, and education. Conversely, LLMs dedicated to IT and civil service received negative feedback.

Taking the national carbon market and seven local carbon markets in China, we use DEA model to measure market efficiency, and then classify them by hierarchical cluster method. Efficiency of the national carbon market and local carbon markets of Beijing, Shenzhen, Hubei and Shanghai are leading, while Guangdong is in the middle; Chongqing and Tianjin are left behind. Room for improvement and scale returns are further analyzed, and suggestions for each carbon market are proposed finally.

This paper studies how regulatory changes affect investors’ reactions at shareholder meetings in China. The objective of this paper is twofold: first, to analyse the information content transmitted to the shareholders of the largest Chinese companies listed on the China Securities Index 300 when an Annual General Meeting is held. A distinction is made between ordinary and extraordinary general meetings. Second, to find out if regulatory changes related to the Company Law of China and online voting in Annual General Meetings affect the information content of those meetings. The abnormal return obtained is examined through an event study using the Fama-French five-factor model. The results of our study indicate that the release of information and involvement of minority shareholders in general meetings during the research period led to higher return volatility and traded volume.

Using a comprehensive dataset for Chinese listed companies from 2009 to 2021, we find that online media is negatively associated with cash dividend level, and the proportion of positive news has a negative moderating effect on this relationship. Our results support the "information intermediary" effect and exclude the "external governance" and "market pressure" effects. We further propose that online media weakens the positive relationship between cash dividends and past earnings (rather than the future), indicating that cash dividends contain signals of improvement in past earnings and are replaced by online news. We also find that only firms with more positive news pay dividends that have signaling effects, and there is a synergistic effect between positive news and dividend signal. Additional results show that the effect of online media on dividend policy is more pronounced than traditional media, which has almost no influence. Our main conclusions remain valid after addressing potential endogeneity issues and conducting various robustness tests.

This study explores how Chinese mutual fund managers’ degrees of disagreement (DOD) on stock market returns affect investor capital allocation decisions using a novel textbased measure of expectations in fund disclosures. In the time series, the DOD negatively predicts market returns. Cross-sectional results show that investors correctly perceive the DOD as an overpricing signal and discount fund performance accordingly. Flow-performance sensitivity (FPS) is diminished during high dispersion periods. The effect is stronger for outperforming funds and funds with substantial investments in bubble and high-beta stocks, but weaker for skilled funds. We also discuss ffnancial sophistication of investors and provide evidence that our results are not contingent upon such sophistication.

We examine the dynamic connection between competition and bank risk within the credit market through the lens of moral hazard affecting banks and borrowers. By combining the perspectives of “competition-fragility” and “competition-stability”, we reveal the intricate influence that competition exercises over bank risk in this financial landscape. Our research scrutinizes these theoretical constructs empirically, drawing upon a dataset comprising 236 rural commercial banks in China from 2012 to 2020. The findings indicate a curvilinear relationship between competition and bank risk, as an inverted U-shape. Furthermore, competition plays a dual role - it improves borrowers’ moral hazard dilemma while exacerbating it for banks. This highlights both riskshifting and risk-margin effects within the competitive dynamics. Ultimately, the nonlinear association between competition and bank risk emerges due to the intricate interplay between the moral hazard factors affecting borrowers and banks.

This study investigates whether and how corporate social responsibility (CSR) affects stock liquidity. Utilizing panel data from 3,366 Chinese enterprises spanning 2010 to 2021, empirical findings suggest that CSR endeavors facilitate an uplift in stock liquidity. Specifically, a 1% increase in CSR score will improve stock liquidity by 0.128%. The research further reveals that media coverage and corporate operations are crucial channels for CSR to affect stock liquidity, with the former playing a more dominant role. Notably, the bolstering effect of CSR on stock liquidity is amplified during periods of increasing economic policy uncertainty. Heterogeneity analysis reveals that the influence of CSR on stock liquidity is particularly salient in state-owned enterprises. Additionally, different CSR subcategories (shareholder responsibility, employee responsibility, and social responsibility) vary in their effect on stock liquidity. Shareholder and employee responsibilities both enhance stock liquidity, with the impact of shareholder liability being particularly pronounced.

The progression of the social credit system is crucial for fostering enterprise innovation and elevating the quality of economic development. Based on the quasi-natural experiment of establishing demonstration cities for the social credit system, this study delves into whether the construction of a social credit system can indeed foster enterprise innovation. Our findings indicate that the establishment of demonstration cities for social credit system promotes enterprise innovation and improves the quality of innovation. Furthermore, mechanism test shows that it alleviates financing constraints faced by enterprises, leading to an increase in the scale and maturity of corporate loans, ultimately fostering corporate innovation. Further analysis of heterogeneity highlights that this positive impact is particularly evident in non-state-owned enterprises and those facing severe financing constraints. These findings present insights that the pivotal role of informal institutions, such as the social credit system, in facilitating the upgrading of industrial structures and augmenting the quality of economic development.