The influence of cultural friction on foreign divestment of multinational enterprises--the moderating role of formal institutional distance and political connections.

Multinational enterprises frequently divest their foreign assets in the current economic environment. Existing research, based on friction theory, has mainly focused on the impacts of political and economic disparities on foreign divestment while neglecting the nuanced influence of cultural factors. To address this gap, this paper draws on the cultural friction perspective to capture the diverse cultural resistance faced by each enterprise and explore the relationship between cultural friction and foreign divestment. Data from Chinese publicly listed enterprises engaged in foreign investment are leveraged, and a dual-level analysis is conducted using Logit panel regression and Cox survival analysis to examine the relationship between cultural friction and foreign divestment from both the viewpoints of the parent company and the overseas subsidiary. Additionally, the paper examines the marginal factors that affect the relationship between them from an institutional perspective. The findings reveal that cultural friction has a positive influence on the propensity of multinational enterprises to divest from foreign markets. Interestingly, a "formal institutional distance paradox" is demonstrated in our study, and politically connected enterprises are found to be more vulnerable to foreign divestment due to the "curse of political affiliations".

Foreign shareholder, overseas sale and corporate profit margin.

China is actively promoting the development of a robust trading nation. In this context, utilizing data from China's A-share listed companies spanning from 2003 to 2021, this study investigates the impact of foreign shareholders on enterprises in a scenario where overseas sales reduce the profit margin of Chinese firms. The findings reveal that overseas sales do indeed decrease the profit margin of Chinese enterprises; however, foreign shareholders mitigate this negative effect and various robustness tests support this conclusion. Mechanism analysis confirms that foreign shareholders primarily enhance enterprise productivity through improved production technology spillover effects, thereby alleviating the adverse impact of overseas sales on Chinese firms' profit margins. Heterogeneity analysis demonstrates that both longer holding periods for foreign shareholders and multiple foreign shareholders significantly alleviate the negative influence of overseas sales on Chinese firms' profit margins. Moreover, there is significant heterogeneity in how foreign shareholders alleviate these detrimental consequences based on property rights nature, institutional environment, overseas related party transactions and subsidiaries, as well as industry attributes. These findings have important reference value for China's efforts towards becoming a strong trading nation and can contribute to enhancing trade capacity in other countries.

Increasing the productivity of shallot planting and its impact on the agricultural market, West Java.

The main objective of this study is to increase the productivity of shallot planting and its impact on the agricultural market. This study analyzes the transmission of shallot prices at the Caringin Main Market (wholesale) level with shallot prices at the farmer (producer) level using quantitative analysis of the Asymmetric Error Correction Model (AECM). The results showed that long-term transmission with positive ECT coefficients and negative ECT showed the same and significant positive values. Positive ECT is 0.286909 and negative ECT is 0.289266, where when there is a price deviation above and below the average balance line of onion prices at the farmer level, it takes three weeks to adjust to the balance of changes in shallot prices. The onion market at the wholesale or parent market occurs asymmetric price transmission from the wholesale price level (Caringin Main Market) to production prices (at the farmer level). A significant t-value of one percent evidences this. Asymmetric price transmission can be caused by abuse of market power.

Prices for Common Services at Quaternary vs Nonquaternary Hospitals.

This study uses commercial claims data to assess whether quaternary hospitals charge higher prices for common, unspecialized services also offered by nonquaternary hospitals.

Green finance and environmental, social, and governance: evidence from Chinese listed companies.

In recent years, academics have paid more attention to green finance, and public companies have reached a broad consensus on the concept of timely environmental, social, and governance (ESG) disclosure. Due to the close relationship between green finance and ESG, this presents an opportunity to determine whether green finance compels companies to actively disclose ESG. The sample for this study consists of China's non-financial A-share listed companies from 2010 to 2021, and the empirical findings demonstrate that green finance can positively influence the ESG performance of listed companies. Through an analysis of heterogeneity, this study reaches the following conclusions: state-owned enterprises, heavy pollution companies, and companies in low-carbon pilot cities perform better in terms of green finance's role in promoting ESG scoring. This study also introduces market concentration and social trust as the moderating variables, enriching the green finance research framework. Through the analysis of moderating variables, the 'black box' effect of green finance on ESG is disclosed, providing theoretical support for the government and companies to better comprehend the policy effect as well as a reference for reform and experimental promotion of green finance.

Research on U-shaped relationship between short-term debt for long-term use and supply chain enterprise default risk: Evidence from Chinese listed firms.

This paper empirically investigates the impact mechanism of short-term debt for long-term use and the default risk of supply chain firms with the data of Chinese A-share listed firms from 2007 to 2021. The study shows that there is a significant U-curve relationship between short-term debt for long-term use and supply chain firms' default risk, and too high or too low a level of short-term loans and long-term investments will worsen firms' default risk. In addition, firm performance plays an mediating effect in the process of short-term debt for long-term investment affecting the default risk of supply chain firms. Finally, customer effect and firm heterogeneity play a moderating role in the impact of short-term loans and long-term investments on the default risk of supply chain firms, and the U-shaped relationship will be strengthened under the high-intensity customer effect. This study has important theoretical and practical significance for analyzing the impact of default risk contagion in supply chain enterprises.

The impact of sustainable public procurement on corporate ESG performance-The Chinese evidence.

Public procurement is an important bridge between public demand and market supply and may affect corporate behavior. However, in the advocacy of sustainable development, the extant research has rarely combined sustainable public procurement (SPP) with corporate ESG performance, to explore whether governments have contributed to the development of sustainable corporate performance through their sustainable procurement activities. This paper fills in the gap by matching the actual implementation of SPP of 42,369 projects in China over 2015~2020 with 20,125 corporate ESG performance data, to analyze the relationship between SPP implementation and corporate ESG performance. The results show that the implementation of SPP has a significant positive impact on corporate ESG performance. Further heterogeneity analysis reveals that the impact is stronger in China's eastern and central regions than in other regions, and corporates at a mature stage are more likely to follow the government sustainable behavior. In addition, the implementation of SPP has a long-term effect on corporate ESG performance. The above findings have important policy implications: firstly, there is a better role for government to play as the "invisible hand", to participate in the market economy; Specifically, SPP policy should be added to government policy tool box to improve corporate ESG performance in addition to disclosure requirement, and the SPP policy employed should in particular attend to the "missing sectors" of sustainability in SPP for the good of corporate ESG; secondly, the government should implement differentiated policies tailored to the region's economic development conditions and corporate development characteristics; thirdly, a long-term evaluation mechanism should be established so that the government can play a more long-term demonstration and leading role.

Financial crisis early warning of Chinese listed companies based on MD&A text-linguistic feature indicators.

Nowadays, the international situation is severe and complex, and the structural issues within the Chinese economy are prominent. Consequently, the financial risks faced by Chinese listed companies continue to escalate. Hence, it is of great practical significance to furnish effective early warnings for financial crises in listed companies. In this paper, we first employ web crawler technology and natural language processing technology to assess four text-linguistic features in the Management Discussion and Analysis (MD&A) section of the annual financial reports of listed companies in China from 2011 to 2020. These features are text tone, forward-looking, readability and similarity. Subsequently, we combine these features with traditional financial indicators and explore thirteen mainstream machine learning models to comparatively analyze their effectiveness in predicting financial crises in listed companies. The empirical findings of this research reveal that MD&A text readability and similarity indicators contribute valuable incremental information to prediction models, whereas text tone and forward-looking indicators exhibit the opposite effect. The latter two indicators can be manipulated more effortlessly by management, as this study's empirical findings indicate no evidence of their contributions in incremental informational value. In fact, the forward-looking indicator even introduces additional noise to the prediction. Finally, by comparing the early warning effects of thirteen machine learning models, it is found that RF, Bagging, CatBoost, GBDT, XGBoost and LightGBM models maintain stable and accurate sample recognition ability. In general, this paper constructs a more effective financial crisis early warning model by exploring the MD&A text-linguistic feature indicators, thereby offering a fresh research perspective for further investigations in this field.

The roles of liquidity and delay in financial markets based on an optimal forecasting model.

We investigate the roles of liquidity and delay in financial markets through our proposed optimal forecasting model. The efficiency and liquidity of the financial market are examined using stochastic models that incorporate information delay. Based on machine learning, we estimate the in-sample and out-of-sample forecasting price performances of the six proposed methods using the likelihood function and Bayesian methods, and the out-of-sample prediction performance is compared with the benchmark model ARIMA-GARCH. We discover that the forecasting price performance of the proposed simplified delay stochastic model is superior to that of the benchmark methods by the test methods of a variety of loss function, superior predictive ability test (SPA), Akaike information criterion (AIC), and Bayesian information criterion (BIC). Using data from the Chinese stock market, the best forecasting model assesses the efficiency and liquidity of the financial market while accounting for information delay and trade probability. The rise in trade probability and delay time affects the stability of the return distribution and raises the risk, according to stochastic simulation. The empirical findings show that empirical and best forecasting approaches are compatible, that company size and liquidity (delay time) have an inverse relationship, and that delay time and liquidity have a nonlinear relationship. The most efficient have optimal liquidity.

The Problem of Limited-Supply Agreements for Medicare Price Negotiation.

This Viewpoint discusses how limited-supply agreements (introduction of generic products in reduced volumes) might thwart efforts to negotiate lower prices on prescription drugs in the US.

Nomen est omen? How and when company name fluency affects return expectations.

Investors perceive stocks of companies with fluent names as more profitable. This perception may result from two different channels: a direct, non-deliberate affect toward fluent names or a deliberate interpretation of fluent names as a signal for company quality. We use preregistered experiments to disentangle these channels and test their limitations. Our results indicate the existence of a significant non-deliberate fluency effect, while the deliberate fluency effect can be activated and deactivated in boundary cases. Both effects are consistent across different groups of participants. However, whereas the fluency effect is strong in isolation, it has limitations when investors are confronted with additional information about the stock.

Macro tax incentives and corporate sustainable innovation: Evidence from Chinese Enterprises.

Innovation has become the driving force behind China's economy's sustainable growth. Due to the efficient transmission of taxation leverage, preferential tax policies are frequently used to stimulate innovation. Therefore, the incentive effect of preferential tax policies on sustainable innovation has gradually become the focus of attention. This paper takes the 2016-2019 China A-share listed high-tech enterprises as a sample, calculates tax incentive intensity with the aid of B-index, and studies the incentive effect of preferential tax policies on the sustainability of corporate innovation. This study shows that: (1) Tax incentive intensity has a positive incentive effect on corporate sustainable innovation. (2) The R&D expenses plus deduction policy and the preferential tax rate policy can significantly enhance corporate sustainable innovation, but there is a substitution effect between them. (3) Based on the heterogeneity of institutional environment and enterprise characteristics, the incentive effect of tax preferential policies is more obvious in enterprises which are non-state-owned and in areas with low government intervention and sound legal system. However, the incentive effect of different types of preferential policies differs in the size of the enterprise. This study will provide reference for the improvement of preferential tax policy system and the optimization of innovation policy environment.

The moderating role of CEO power on the relationship between environmental, social and governance disclosure and financial performance in emerging market.

The study proposes to examine how environmental, social and governance disclosure (ESG) affect the financial performance (FP) of Indian firms. Furthermore, it aims to evaluate the moderation impact of CEO power (CEOP) on the association between ESG on the FP. The study's target population is all firms indexed in NIFTY 100, representing the top one hundred firms by market capitalisation from 2017 to 2021. Data relating to ESG were collected and built based on the available data on Refinitiv Eikon Database. Results reveal that EDI positively and significantly impacts the ROE and TQ of Indian firms. Furthermore, SDI and GDI negatively and significantly affect the ROE and TQ of Indian firms. Moreover, ESG and CEOP have a significant impact on ROE. Nevertheless, ESG has a negative but highly significant impact on ROE, whilst it has a negative and low considerable impact on the TQ of Indian firms. Nonetheless, CEOP does not moderate the association between ESG and FP measured by ROE and TQ. This research contributes to the existing literature by introducing a moderator variable that has not been used in the Indian context; CEO power, which provides stakeholders and regulators with useful findings that would encourage firms to create an ESG committee to enhance ESG disclosure to compete on the world market and reach the United Nations (UN) Sustainable goal 2030. Furthermore, this paper provides insightful recommendations for creating an ESG legal framework for decision-makers.

The impact of green financial development on stock price crash risk from the perspective of information asymmetry in Chinese listed companies.

Solving the crash risk problem of corporate stock price caused by information asymmetry can mitigate the negative externality of its carbon emission to become green, low-carbon, and high-quality development. Green finance generally profoundly impacts micro-corporate economics and macro-financial systems but remains a giant puzzle of whether they can effectively resolve the crash risk. This paper examined the impact of green financial development on the stock price crash risk using the sample data of non-financial listed companies in Shanghai and Shenzhen A stock market in China from 2009 to 2020. We found that green financial development significantly inhibits the stock price crash risk; this is more obvious in listed companies with a high level of asymmetric information. And companies in high-level regions of green financial development attracted more attention from institutional investors and analysts. As a result, they disclosed more information about their operational status, thus reducing the crash risk of corporate stock price from the torrential public pressure of lousy environmental details. Therefore, this study will help continuously discuss the costs, benefits, and value promotion of green finance for synergy between corporate performance and environmental performance to improve ESG capabilities.

Does the history of opening ports and trading influence the long-term business credit environment of cities? Evidence from the Yangtze River Delta region of China.

Based on the China City Commercial Credit Environment Index (CEI), a more scientific spatial DID model was used to examine the long-term impact of the opening of ports and trading in the late Qing Dynasty on the urban commercial credit environment, taking cities above the prefecture level in the Yangtze River Delta as a sample. The study confirms that: (1) the opening of ports and commerce in the late Qing Dynasty had a significant contribution to the urban commercial credit environment, which was conducive to the transformation of production methods and interpersonal relationships from traditional to modern, and to the improvement of the urban commercial credit environment. (2) Before the signing of the Treaty of Shimonoseki, the local forces of the late Qing Dynasty were resistant to the economic aggression of the Great Powers, and the positive impact of the opening of ports and trading on the commercial credit environment of port cities was more significant, but the impact was not obvious after the signing of the Treaty of Shimonoseki. (3) From the history of the opening of ports for trade in the late Qing Dynasty, the economic aggression of the Western powers against the non-patronage areas by means of the buying class objectively strengthened the concept of rule of law and credit awareness in the local market and exerted a long-term influence on the commercial credit environment of the cities, but the impact of the opening of ports for trade on the commercial credit environment of the patronage areas was not prominent. (4) Cities located in the sphere of influence of the common law powers had a more pronounced impact on the commercial credit environment as their institutions and concepts were more easily transplanted, while the impact of the opening of ports and trading on the commercial credit environment of cities in the sphere of influence of the civil law powers was not significant. Policy Insights: (1) Enhance the ability to negotiate with foreign countries on economic and trade matters from a level-headed world perspective, and be bold and adept at fighting unreasonable rules, standards and requirements in order to better optimise the business credit environment; (2) Regulate the use of administrative resources and avoid undue administrative intervention, which is an important prerequisite for improving the basic system of the market economy to enhance the business credit environment; (3) Emphasise both connotative development to follow a Chinese style modernisation path, and (3) emphasising selective cooperation to promote outward development, promoting the interaction, convergence and matching of domestic and foreign regulations, and continuously improving the regional commercial credit environment.