A Bridge on Economic Issues between China and the World
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E vs. G: Environmental Policy and Earnings Management in China
Darwin Choi, Feifei Lai, Mar 12, 2025We examine the conflict between environmental and governance issues arising from China’s automatic air pollutant monitoring system, introduced in 2012. Our findings suggest that polluting firms engage in downward earnings management to potentially minimize regulatory attention, with factors such as firm size, profitability, and market conditions influencing the extent of this behavior. This study highlights the unintended consequences of environmental policies.
Sowing Seeds of Mobility: The Uneven Impact of Land Reform
Ting Chen, Jiajia Gu, Rachel Ngai, Jin Wang, Jul 16, 2025Land market frictions due to incomplete property rights are a major form of mobility barrier in many developing countries, where rural households risk losing land if they stop cultivating it. This implicit barrier is made explicit through China’s Hukou system. Using two land reforms that reduce these barriers, we construct a novel county-level reform index and argue that these reforms have contributed to improvement in agricultural productivity and have uneven impact across gender. They improve rural women’s transition to non-agriculture relative to rural men, but at the same time, increasing gender gap among the urban population.
China’s Successful Securities Regulation to Protect Investors
Thomas Bourveau, Xingchao Gao, Rongchen Li, Frank S. Zhou, Nov 12, 2025In emerging markets, controlling shareholders may extract private benefits at the expense of minority investors. To safeguard cash-flow rights, regulators have turned to dividend requirements, yet their rigidity risks stifling investments and growth. In China, the regulator successfully adopted an intermediate “comply-or-explain” approach to strengthen investor protection without forcing firms to forgo investments and growth.
Migration and Resource Misallocation in China
Xiaolu Li, Lin Ma, Yang Tang, Oct 23, 2024This article discusses how reducing frictions across Chinese provinces could significantly improve aggregate output, lower spatial inequality, and discourage population concentration in large cities.
Firm-to-Firm Referrals
Jing Cai, Wei Lin, Adam Szeidl, Dec 25, 2024Referring suppliers to clients reshaped the supplier-client network and improved business performance.
