International Review of Economics & Finance最新文献

The study applies an endogenous switching probit model, using the data from the China Household Finance Survey (CHFS) to explore the joint decision mechanism between housing purchase and entrepreneurship and estimate the (treatment) effect of housing-purchase on entrepreneurship. The findings are threefold. First, a higher housing price reduces the probability of house-purchase intention, and also that of actual house-purchase-action. Second, both house-purchase-intention and -action discourage actual entrepreneurship investment. Third, house-purchase-intention has a negative effect on potential entrepreneurship plans, while house-purchase-action encourages households to plan for a business in the future.

This paper examines the impact of environmental corporate social responsibility (CSR) on stock price crash risk. Using a sample of publicly listed Chinese firms for the period 2010 to 2020, we find that environmental performance negatively affects crash risk. ISO 14001 certification, however, does not exert a significant effect. The negative relationship between environmental performance and crash risk is mediated by the visibility of the firm, and moderated by the certification of ISO 14001, respectively. In addition, the documented relationship is more evident for firms belonging to heavily polluting industries, non-SOEs and firms with greater media coverage and higher market competitive status. Our results remain consistent after controlling for endogeneity concerns and a batch of robustness tests. This study provides new insights into the CSR literature by highlighting the risk-mitigating role of environmental CSR in firms’ future stock price crashes.

The influence of elderly consumption is increasing, and community-based elderly home care service (CEHCS), as an important social security system, will have a significant impact on household consumption levels and consumption structure. This paper utilizes data from five batches of CEHCS pilot policies implemented in China from 2016 to 2020, combined with data from the China Health and Retirement Longitudinal Study (CHARLS) from 2011 to 2020, to design a dynamic difference-in-differences model to systematically evaluate the dynamic effects and mechanisms of CEHCS on elderly household non-durable goods consumption. The study found that after the coverage of CEHCS, the consumption levels of non-durable goods such as clothing, daily necessities, and cultural and entertainment products in middle-aged and elderly households significantly increased year by year, while consumption of durable goods significantly decreased. Moreover, the impact of CEHCS was more pronounced in households with lower housing assets and rural households. Mechanism analysis suggests that CEHCS promote the increase in non-durable goods consumption by alleviating children's labor constraints, reducing the family's caregiving burden, and diminishing precautionary savings. This paper provides further empirical evidence on the pathways through which elderly care services influence household consumption behavior, which holds significant implications for proactively addressing population aging and unlocking household consumption potential through micro-institutional design.

The paper proposes a new theoretical explanation for the spatial sorting that the skill distribution has fatter tails in big cities. The ownership of the house make people face the constraint of house’s minimum area when purchasing it, therefore, and finally induces the spatial sorting. The new theory could distinguish buying and renting houses, and identify public services attached to housing ownership and enjoyed by all people no matter who buy or rent houses. The policy implications are also different from those in previous theories: when land supply is reduced in big cities, it predicted a decrease in the number of low-skilled workers in previous theories, whereas it predicts an increase in the theory of housing ownership constraints. In big cities, public services attached to housing ownership would attract more high-skilled workers and decrease low-skilled workers, while public services enjoyed by all people would attract both of them.

This study investigates whether internal governance stemming from subordinate executives' employment horizons affects corporate cash holdings. Consistent with the idea that key subordinate executives provide checks and balances within a firm and affect corporate decisions, we find cash holdings increase with subordinate executives' horizon, supporting the precautionary motive for the former. Controlling for alternative explanations, the positive association between internal governance and cash holdings is hardly affected by the agency motive, tournament incentives between CEO and subordinate executives or confidence level of executives. Our findings are also robust to alternative measures of subordinate executives' horizon and cash holdings and are not driven by endogeneity issues. The analysis of cash sources documents that firms with longer subordinate executives’ horizon save a higher proportion of cash proceed through reduced dividend payouts and equity issuance, rather than debt. This study contributes to the literature by shedding light on how diverse agents with different employment horizons in the top management team influences the liquidity policy of the firm.

This paper investigates the effects of environmental performance shortfalls on corporate green innovation. On the basis of the theoretical framework of environmental performance feedback and using a sample of eight major energy-consuming industries in China, a negative relationship is confirmed that environmental performance below but in the neighborhood of peer level makes firms more inclined to pursue green innovation. Higher risk-taking willingness for firms with environmental performance below but close to peer level strengthens innovative intention. This correlation is pronounced when corporate financial performance, green innovation performance, and executive compensation are below peer level. We also find that green credit constrained firms prefer to engage in innovation activities when their environmental performance is below but near peer level and they have fewer bank loans simultaneously. The findings offer insights into the innovation behavior of firms in response to environmental underperformance.

Digital innovation and entrepreneurship activities are quite active and developing rapidly in China. However, the ways in which digital startups can efficiently utilise digital entrepreneurship ecosystems (DEEs) to improve their entrepreneurial performance remains unclear. To address this question, this study analysed data from 206 digital start-ups in China and found: 1) Ecological niche and ecological relationship significantly contribute to digital entrepreneurial performance. 2) Resource bricolage and opportunity iteration have a chained mediating effect between DEE and digital entrepreneurial performance. 3) Digital capability has a positive (negative) moderating effect between ecological relationship and resource bricolage (opportunity iteration). Finally, this study explores the implications of these findings and future research directions.

This paper investigates the dynamic spillover effects of major commodity prices within the Chinese oil industrial chain. By integrating the Granger causality test with the BEKK-GARCH model, a multidimensional spillover network is constructed to comprehensively analyze the price spillover relationships between commodities from 2013 to 2019. The study finds that crude oil price volatility is the primary driver of spillovers to other commodities within the industrial chain, with midstream commodities such as ethylene and benzene playing a critical intermediary role in the spillover process. Additionally, the spillover between commodities is generally bidirectional, with non-closed chain spillover patterns being more common. Based on these findings, the paper offers policy recommendations to mitigate the risks of price fluctuations, promoting the stable development of the oil market and the sustained growth of the national economy.

Innovation diversity has the potential to enhance a firm's technological capabilities and output by facilitating the sharing of know-how across teams. However, the diversification of corporate business segments can lead to management deterioration due to agency problems, ultimately resulting in damage to firm performance and innovation output. Therefore, this paper investigates the impact of diversified innovation and multi-segment firms on innovation outcomes.

We show that when a firm with multiple business segments exhibits a higher degree of innovation diversification, the positive impact of the internal knowledge spillover can mitigate resource inefficiency, resulting in higher levels of innovation performance. To address potential endogeneity concerns, we employ a quasi-natural experiment suggested by Seru (2014), and make a comparison between completed mergers and withdrawn mergers in order to examine the effects of merger-driven diversification on innovation performance. We further conduct three conditional tests, including institutional ownership, trade secrets legal protection and financial constraint. We find that the positive impact of innovation diversity and diversity of business segments on innovation performance will be more significant when firms have better corporate governance, face weaker trade secret legal protection and when firms are financially unconstrained.

In this study, we examine the risk transmissions between the bitcoin market, political uncertainty, and various financial market uncertainty measures. We find that the returns and volatilities of Bitcoin are the receivers of the information from political uncertainty measures, such as the geopolitical risk index and the party conflict indices. These effects are strong during periods of financial stress. Further, the financial market uncertainty measures switch between the roles of transmitters and receivers over time. Our results further show that Bitcoin has hedging and safe-haven properties that mitigate political uncertainty. Our results provide a full understanding of how political uncertainty is transmitted to the Bitcoin market.