Macro tax burden, FDI, and national innovation efficiency: A study on the impact of macro tax burden on national innovation efficiency.

Based on a panel dataset of 54 countries from 2008 to 2019, this article uses the mediation effect model to examine the relationship between macro tax burden, FDI and innovation efficiency. We find that:(i) the macro tax burden is positively correlated with the innovation efficiency; (ii) there is a non-linear effect of FDI on innovation efficiency conditional on macro tax rate. When the macro tax burden is greater than the critical value (25.28%), it indirectly limits innovation efficiency by hindering FDI inflows. This means that in order to promote innovation efficiency at the national level, the macro tax rate should be maintained at a reasonable level, because that can make the government raise more money to invest in and subsidy the innovation activities.

International oil price uncertainty and enterprise investment efficiency: An empirical research of listed companies in China.

This article investigates the effect of international oil price uncertainty on investment efficiency using quarterly data of Chinese A-share listed companies from 2011 to 2020. It is discovered that uncertainty about oil prices increases principal-agent conflicts and information asymmetry in enterprises, leads to more inefficient investment, and ultimately lowers firms' investment efficiency. Furthermore, China's unique property rights foundation, firm size, and life cycle limit the aforementioned consequences. Additional investigation reveals that by raising companies' cash reserves, oil price uncertainty exacerbates overinvestment behavior. The study presented in this article can serve as a guide for businesses looking to make the best decisions in the context of volatile global oil prices and support their long-term, stable development.

Climate policy uncertainty and its impact on real estate market dynamics: A sectoral and regional analysis.

This study explores the impact of Climate Policy Uncertainty (CPU) on real estate market volatility, utilizing the CPU index to assess how climate policy affects various real estate segments. It highlights the significant impact of CPU on sectors with high energy demand and emissions, such as industrial and residential. A multi-horizon analysis reveals the long-term sensitivity of CPU's influence, with significant sensitivity noted in coastal regions prone to climate risks. The findings provide crucial insights for investors and policymakers, emphasizing the importance of integrating CPU considerations into strategic decision-making for real estate investment.

Appraising eHealth Investment for Africa: Scoping Review and Development of a Framework.

BACKGROUND: As opportunities grow for resource-constrained countries to use eHealth (digital health) to strengthen health systems, a dilemma arises. Wise eHealth investments require adequate appraisal to address opportunity costs. Economic appraisal techniques conventionally utilised for this purpose require sufficient economic expertise and adequate data that are frequently in short supply in low- and middle-income countries. This paper aims to identify, and, if required, develop, a suitable framework for performing eHealth investment appraisals in settings of limited economic expertise and data. METHODS: Four progressive steps were followed: (1) identify required framework attributes from published checklists; (2) select, review, and chart relevant frameworks using a scoping review; (3) analyse the frameworks using deductive and inductive iterations; and, if necessary, (4) develop a new framework using findings from the first three steps. RESULTS: Twenty-four candidate investment appraisal attributes were identified and seven relevant frameworks were selected for review. Analysis of these frameworks led to the refinement of the candidate attributes to 23 final attributes, and each framework was compared against them. No individual framework adequately addressed sufficient attributes. A new framework was developed that addressed all 23 final attributes. CONCLUSIONS: A new evidence-based investment appraisal framework has been developed that provides a practical, business case focus for use in resource-constrained African settings.

Balance matters more: Research on the effect of corporate social responsibility equilibrium on stock price crash risk.

The impact of the degree and effectiveness corporate social responsibility (CSR) fulfillment on corporate value assessment by investors is significant. However, prior research on effects of CSR on stock price crash risk has showed contrasting results. Certain studies suggest that an abundance of CSR can become a self-serving tool for management. This may lead to concealing and accumulating negative information, resulting in stock price collapse. Based on principal-agent theory, we suggest that CSR equilibrium could be an effective approach to prevent the concealment of negative events by managers. Employing data from Chinese A-share listed companies spanning 2010 to 2020, we examine how CSR equilibrium and corporate governance levels influence the risk of stock price collapse across entities with different property rights. Empirical findings indicate that a balanced distribution of CSR can mitigate the risk of stock price collapse. Furthermore, we find that higher levels of corporate governance can mitigate the negative impact of CSR equilibrium on stock price collapse risk. Interestingly, this governance effect is more pronounced in state-owned enterprises compared to private enterprises, where the likelihood of hiding adverse information is higher. Additionally, it provides a theoretical explanation for the impact of CSR equilibrium on the risk of stock price collapse, based on the principal-agent problem, thereby expanding the applicability of the theory. Practically, the research findings carry significant implications for listed companies, CSR rating agencies, and investors.

Circular causality analysis of corporate performance and accounting quality in M&As.

The past performance and the capital structure of the companies that are involved in mergers and acquisition (M&As) are considered into the analysis of the circular causality relationship between financial performance and market value. Considering two models, one for value relevance and one for accounting conservatism, this paper aims to analyze if the capital market influences the accounting practices of a target company or that the accounting figures influence the capital market. The analyzed sample used in the study is represented by the target companies involved in M&As which took place in the European Union Enlarged in 2017-2018. Financial and market data were considered for eight years (2011-2018). Using the conservatism model, the results show that targets' earnings are significantly influenced by their financial leverage as an indicator for financial structure. Using the value relevance model, the capital market reaction is influenced by prices and return on equity that indicates the capital market influence on accounting figures.

Insurance participation, equity pledge and stock price crash risk: Evidence from China.

This paper analyzes the causes of equity pledge, external conduction mechanisms, and economic consequences from the perspective of insurance participation by integrating insurance participation, equity pledge, and stock price crash risk into a unified framework. An empirical analysis of sample data from listed companies in Shanghai and Shenzhen between 2007-2021, indicates that equity pledge reduces the risk of collapse as companies hedge the risk induced by the equity pledge. Further research has revealed that insurance participation can mitigate stock price crash risk brought by equity pledge through a regulatory effect, which is more pronounced for private companies and those with a high shareholding ratio, and companies in manufacturing industry. This is because private companies have a higher demand for capital as their property rights are not state-owned, the degree of separation of powers and agency conflicts is greater in companies held by large shareholders, manufacturing companies usually have stable earnings and cash flow performance, and the financial support provided by insurers for equity pledges at risk can effectively reduce the risk of their collapse.

The effect of digital government on corporate total factor productivity.

This study examines the influence of digital government initiatives on corporate total factor productivity (TFP). Employing a difference-in-differences (DID) methodology and analyzing data from publicly listed companies spanning the period 2010 to 2020, we investigate the impact of digital governance on corporate TFP. Our findings reveal a noteworthy positive effect, with an average TFP increase of 5%. Further exploration through heterogeneity analysis indicates that this impact is particularly pronounced in regions with robust network infrastructure, increased marketization, and decreased economic uncertainty, particularly among privately-owned enterprises. Moreover, we identify key mechanisms through which digital governance fosters this enhancement in TFP, including the facilitation of technological innovation, efficient allocation of high-skilled labor, and improved investment efficiency. Our research underscores the significant role of digital government initiatives in bolstering corporate TFP and contributes to a deeper understanding of the mechanisms underlying this relationship.

International operations and corporate R&D investment: Evidence from China.

This paper presents an examination of the relationship between international operations and corporate R&D investment. Using a large sample of Chinese listed firms for the 2009-2022 period and the ordinary least squares method, we find that international operations have a positive effect on corporate R&D investment. The finding remains valid after a battery of robustness tests. Mechanism tests show that international operations increase corporate R&D investment by diversifying product demand instead of increasing firms' international knowledge acquisition. This paper provides new evidence on the role of international operations in innovation activities.

Can good ESG performance of listed companies reduce abnormal stock price volatility? Mediation effects based on investor attention.

Today, with a growing emphasis on sustainable economic development, corporate environmental, social and governance (ESG) performance is attracting increasing attention and favor from investors. This triggers a question: can good ESG performance of listed companies mitigate the "up and down" of the stock market by drawing investor attention? This paper utilizes the data from China's A-share listed companies from 2011 to 2020, with investor attention as a mediating variable, to explore how the ESG performance of listed companies influences abnormal stock price volatility. The findings suggest that stronger ESG performance of listed companies significantly reduces abnormal stock price volatility, in which investor attention plays a partial mediating role. This paper confirms the robustness of the findings through multiple robustness and endogeneity tests. Heterogeneity analysis reveals that listed companies with good ESG performance during the growth period are more likely to significantly mitigate abnormal stock price volatility. Similarly, firms that maintain commendable ESG performance in bear markets significantly reduce abnormal stock price volatility. These findings enrich the theoretical research on the impact of ESG performance on abnormal stock price volatility, provide empirical evidence for listed companies to emphasize ESG investment and encourage investors to consider ESG ratings. Additionally, the study provides a new perspective for government agencies to utilize corporate ESG performance to maintain the sound development of the capital market.

The measurement of China's provincial physical capital stock based on the improved method and indicators.

Physical capital stock is the basic indicator of macroeconomic empirical studies and also an important manifestation of macroeconomic activity capacity. When measuring China's provincial physical capital stock by the perpetual inventory method, the treatment for the depreciation rate and the initial physical capital stock in the existing literature has some defects in reflecting the economic performance. The purpose of this paper is to build the most reliable and reasonable statistical series of China's provincial physical capital stock. We establish a measurement formula in form of the variable depreciation rate and improve the treatment for the depreciation rate and the initial physical capital stock. For the depreciation rate, we measure the benchmark depreciation rate of physical capital and determine the variable depreciation rate according to the economic growth rate, which makes the variable depreciation rate reflect the economic growth. For the initial physical capital stock, we measure the initial physical capital stock according to the capital output ratio, which makes the initial physical capital stock reflect the economic aggregate. Based on these improvements, we measure China's provincial physical capital stock from 1952 to 2022 by the perpetual inventory method. Through analyzing the measurement results, we have a more distinct insight into the temporal and spatial characteristics of China's provincial physical capital stock: The growth rate of physical capital stock at the provincial level has slowed in spite of remaining high; The eastern region is much higher than the central and western regions. According to these two characteristics, it is suggested that policymakers need to improve market mechanisms and adjust investment policies to promote a benign profile of economic growth and a regional optimization of capital formation.

Greenium of green securitization: Does external certification matter?

The financing costs of green asset-backed securities (ABS) are deeply affected by the increased information asymmetry and greenwashing risk resulting from risk transferring in securitization. To attract potential investors, many ABS issuers obtain external certifications, yet it is unclear whether they pay off financially. Based on a sample of 588 green ABS issued in China for 2016-2022, this paper examines the impact of external certification in the form of green certification and reputation of financial intermediaries involved in the issuance on the yield discount of green ABS over the paired non-green ABS. The empirical findings show that both external certifications lower the greenium of green ABS by serving as favorable signals and mitigating greenwashing concerns, especially in non-financial industry and the securities exchange market. Moreover, the information asymmetry and credit risk of issuers enhance the pricing effect of financial intermediary certification but undermine that of green certification. Our findings provide valuable implications to facilitate the financing efficiency of green financial markets and promote global low-carbon transition.

The impact of digital financial development on corporate leverage ratio: The case of a-share listed non-financial enterprises in China's Shanghai and Shenzhen stock exchanges.

This study investigates the impact of digital finance on corporate leverage ratios. The study employed a large sample of China's Shanghai and Shenzhen A-share non-financial listed enterprises from 2011-2020. The study's results depict that the development of digital finance can significantly reduce the leverage ratio of enterprises. We empirically identified that digital finance affects the difference in the term structure of the corporate leverage ratio. It was found that the development of digital finance has a significant negative impact on enterprises' short-term and long-term leverage ratios. Moreover, our heterogeneity analysis shows that the negative effect of digital financial development on corporate leverage ratios is different in state-owned and non-state-owned enterprises, large-scale and small-scale enterprises, and high-leverage and low-leverage enterprises. Mechanism analysis shows that the development of digital finance can reduce corporate leverage by lowering financing costs, alleviating financing constraints, and weakening non-systemic risks. Therefore, policymakers should focus on developing and adopting digital finance by creating a supportive regulatory environment, improving access to digital financial services, and encouraging innovation in the digital finance sector. Finally, our results remain robust after addressing endogeneity issues and conducting robustness checks.

Health insurance, agricultural production and investments.

We study the effects of health insurance coverage on agricultural production decisions, examining the causal relationships by exploiting a health care reform and providing a theoretical framework to elucidate underlying mechanisms. We find that the reform led to long-run increases in total cultivation investments and output, accompanied by a shift in households' cultivation portfolio towards riskier crops. We explain these findings using a model of agricultural investment, highlighting the important roles of health insurance in mitigating background medical expenditure risks and enhancing health. We also find that the reform improved households' financial well-being through reduced debts and defaults on loans.

Welfare costs of suboptimal retiree decisions.

We make a novel investigation of welfare costs associated with various suboptimal decisions made by retirees, both analytically and numerically. We utilize a unique framework that incorporates recursive utility with housing, and also encompasses expected utility and recursive utility without housing as special cases. Our findings indicate that under-investment in stocks incurs lower welfare costs compared to an equivalent over-investment. Suboptimal allocations in bond holdings result in higher costs than similar misallocations in stocks. Choosing not to participate in the stock market is less detrimental than avoiding the bond market. Should retirees opt to simplify their decision-making by investing solely in one type of asset, it is less costly for them to invest exclusively in bonds. Overconsumption of housing is less costly than an equivalent underconsumption. Suboptimal consumption imposes the highest welfare cost. Decisions regarding consumption, housing, and savings are found to be more crucial than the choice of how to distribute liquid savings between stocks and bonds. Additionally, recursive utility model better captures retirees' preference for bonds over stocks than expected utility model. Our results, which are consistent across various parameter settings, provide valuable insights for academics and policymakers aiming to enhance retiree welfare.

Do regional tax incentive policies improve productivity?

The difficulty in transforming old industrial areas constitutes a significant factor contributing to regional development imbalances. Can regional tax incentives, as a crucial component of regional policies, polish the "rust belt" regions? This study leverages the inaugural Value-Added Tax (VAT) reform in China as an opportunity to explore the potential of regional tax incentives in achieving sustainable development in traditional industrial areas. Drawing upon a comprehensive industrial enterprise database, we employ a Propensity Score Matching-Difference in Differences (PSM-DID) approach to examine the efficacy of these tax incentives. Our findings reveal that: (1) Regional tax incentives primarily enhance firms productivity by stimulating investment in enterprises, yet they do not contribute to improved investment efficiency or spur innovation within firms. (2) Regional tax incentives have alleviated financing constraints for enterprises in old industrial bases, significantly enhancing the Total Factor Productivity (TFP) of firms with higher financing constraints. This policy has had an even stronger impact on improving the TFP of state-owned and monopolistic enterprises. (3) Regional tax incentives have impeded productivity growth by preventing the exit of low-efficiency firms and the entry of high-efficiency ones. These incentives also increased the likelihood of "zombie firms" forming and failed to promote endogenous economic growth in the Northeast region. Additionally, they have distorted the allocation of resources towards capital and technology-intensive industries in that area. In China's old industrial bases, regional tax incentives should be coordinated with market-oriented reforms; these regional tax incentive policies should also be further enriched.

Period-aggregated transformer for learning latent seasonalities in long-horizon financial time series.

Fluctuations in the financial market are influenced by various driving forces and numerous factors. Traditional financial research aims to identify the factors influencing stock prices, and existing works construct a common neural network learning framework that learns temporal dependency using a fixed time window of historical information, such as RNN and LSTM models. However, these models only consider the short-term and point-to-point relationships within stock series. The financial market is a complex and dynamic system with many unobservable temporal patterns. Therefore, we propose an adaptive period-aggregation model called the Latent Period-Aggregated Stock Transformer (LPAST). The model integrates a variational autoencoder (VAE) with a period-to-period attention mechanism for multistep prediction in the financial time series. Additionally, we introduce a self-correlation learning method and routing mechanism to handle complex multi-period aggregations and information distribution. Main contributions include proposing a novel period-aggregation representation scheme, introducing a new attention mechanism, and validating the model's superiority in long-horizon prediction tasks. The LPAST model demonstrates its potential and effectiveness in financial market prediction, highlighting its relevance in financial research and predictive analytics.

A roadmap for affordable genetic medicines.

Twenty genetic therapies have been approved by the US Food and Drug Administration to date, a number that now includes the first CRISPR genome-editing therapy for sickle cell disease-CASGEVY (exagamglogene autotemcel, Vertex Pharmaceuticals). This extraordinary milestone is widely celebrated owing to the promise for future genome-editing treatments of previously intractable genetic disorders and cancers. At the same time, such genetic therapies are the most expensive drugs on the market, with list prices exceeding US$4 million per patient. Although all approved cell and gene therapies trace their origins to academic or government research institutions, reliance on for-profit pharmaceutical companies for subsequent development and commercialization results in prices that prioritize recouping investments, paying for candidate product failures and meeting investor and shareholder expectations. To increase affordability and access, sustainable discovery-to-market alternatives are needed that address system-wide deficiencies. Here we present recommendations of a multidisciplinary task force assembled to chart such a path. We describe a pricing structure that, once implemented, could reduce per-patient cost tenfold and propose a business model that distributes responsibilities while leveraging diverse funding sources. We also outline how academic licensing provisions, manufacturing innovation and supportive regulations can reduce cost and enable broader patient treatment.