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The purpose of this study is to investigate the impact of the accounting system reform on corporate innovation behavior and the heterogeneity and underlying mechanisms of this impact. This paper further aims to study the impact of accounting system reform on corporate value.

This study takes China's A-share listed corporates as a sample and uses the exogenous policy shock of the implementation of the New Accounting Standards in 2007 to design the identification strategy of propensity score matching and difference-in-differences method. By comparing the differences between the innovation level of corporates in high-tech industries and non-high-tech industries before and after the implementation of the New Accounting Standards, the impact of the accounting system reform on corporates' innovative behavior can be identified.

Results show that compared with corporates in traditional industries, high-tech corporates obtained higher patent output after the implementation of the New Accounting Standards. This reform mainly affects corporate innovation by improving corporate risk-taking. In addition, this paper finds that the reform of the accounting system has increased the market value of high-tech corporates in the long run.

This study provides new empirical evidence for addressing the insufficient innovation incentives for market entities and enriches the existing literature on the economic effects of the change of accounting systems and the influencing factors of corporate innovative behavior from the accounting system perspective.

It is imperative for policymakers, financial institutions, and individual investors to comprehend the factors that impact stock market participation, given the growing significance of the stock market in terms of personal and national wealth. This study endeavours to explore the relationship between cognitive ability and participation in the stock market. We examine the relationship between cognitive abilities and stock market participation, and further explore the mechanism of their influence.

The data from the China Family Panel Studies is utilized, and Tobit and Probit regressions are employed. Additionally, an instrumental variable approach (IV-estimate) is implemented to address the endogeneity issue linked to cognitive ability, and the study’s findings are resilient.

The results reveal a significant positive relationship between cognitive ability and stock market participation. Additionally, the findings suggest that households with higher cognitive ability tend to aggregate more information, expand social networks, and take more risks. A likely explanation is that individuals with higher cognitive ability are more likely to process more external information and evaluate the subjective uncertainty of stock markets based on a well-defined probability distribution. Our findings indicate that the impact of cognitive ability on stock market participation varies among families with differing education levels, genders, marital statuses, and geographical locations.

Therefore, the roles of cognitive abilities in accelerating stock market participation should be fully considered. More information channels and sources that contain financial markets’ information (e.g. mobile applications and financial education) should be provided. Thus, the significance of cognitive ability in increasing stock market participation should be fully considered. Providing more information channels and sources, such as mobile applications and financial education, that contain financial markets’ information would be helpful. Our study contributes to promoting financial literacy and inclusion by highlighting the significant positive impact of cognitive ability, where institutions can tailor their outreach efforts and information channels to better serve individuals with different cognitive ability.

High-quality labor supply is inevitable to maintain sustainable and steady economic growth. This study mainly explores the impact of the social pension system on the health of human capital, and further explores its impact mechanism.

On the basis of the data from China Family Panel Studies from 2012 to 2018, this article uses the fixed effect model and the mediation effect model to empirically study the influence of the social pension scheme on the health of human capital and further explore its influence mechanism.

This study shows that the social pension scheme can significantly improve the physical and mental health of laborers, especially for low-income and agricultural groups. The implementation of the social pension scheme contributes to increasing medical services and reducing the labor supply for the benefit of human health capital. Therefore, the government should continue to expand the coverage of the social pension scheme and comprehensively improve the importance of human health capital on economic growth.

Medical costs and labor supply play a mediating effect in the relationship between social pension and rural labors' health status, which indicates that medical costs and labor supply level are still important factors affecting the health status of rural labor. There are essential factors affecting the health status of the rural labor force, and their role should be given more consideration in the process of system design and improvement.

The existing studies have more frequently studied the effect of the implementation of social pension schemes from the perspective of economic performance, but this paper evaluates the policy effect of social pension schemes based on the perspective of health human capital, which enriches research on health performance in related fields.

The purpose of this paper is to explore the matching relationship between factor endowment and industrial structure, and its impact on economic growth.

The assortative matching method is developed to quantitatively measure the matching between factor endowment and industrial structure. A series of empirical tests are then carried out to evaluate the impact on the economic development of the matching.

1) The matching between factor endowment and industrial structure has a significantly positive impact on economic growth. (2) Economic growth reaches its maximum when the gap between the two sectors narrows to zero. (3) This effect is particularly significant for countries with higher GDP per capita and GNI per capita. (4) The results remain robust after employing a series of tests.

Aggressive industrial policies are not desirable. The optimal industrial structure is the one that complied with the comparative advantage of the given factor endowment in the economy.

So far, there has been a significant lack of an applicable quantitative indicator for measuring the matching between factor endowment and industrial structure, which is essential for conducting empirical tests and providing evidence for related economic theories.

This study examines the effect of local government debt (LGD) on corporate earnings management using 25,624 firm-year observations from 2007 to 2019.

Pooled ordinary least squares (OLS) regression is used to examine the impact of LGD on earnings management. A difference-in-differences (DID) method is also used to alleviate potential endogeneity.

Results show that LGD motivates firms to increase earnings management, especially income-decreasing earnings management. Findings are robust to DID method and robustness tests. Heterogeneity analyses show that the positive effect of LGD on earnings management is pronounced in firms with political dependence and moderated by external governance mechanisms. Further discussions indicate that tax enforcement is an underlying channel for LGD to affect earnings management. Firms engage in downward real earnings management by increasing their abnormal discretionary expenditures and higher LGD leads to a greater book-tax difference in those firms that manipulate income-decreasing earnings management.

This study contributes towards examining the political costs hypothesis, the microeconomic effects of LGD and the determinants of earnings management.

China's New Rural Pension Program (NRPP) has been implemented for a decade, but the factors that facilitate rural residents' participation have received little attention. This study aims to investigate whether financial literacy has an influence on rural residents' behavior of participation in the NRPP. In particular, this study further verifies if high financial literacy is important and whether financial education can enhance the impact of financial literacy on current, long-term and dynamic pension decisions of rural households.

This study investigates the impact of financial literacy on rural residents' participation in China's NRPP using the China Household Financial Survey (CHFS) Data of 2015 and 2017. This study constructs an analytical framework for current, long-term and dynamic impacts and comprehensively analyzes the value of financial literacy in the decision making of the NRPP. This study uses the instrumental variable method to solve the possible endogeneity problem. In addition, the authors also demonstrate the positive role of high financial literacy in household pension decisions. Further analysis reveals gender and regional heterogeneity in the impact of financial literacy on pension decisions. The moderating effect model explores whether financial education has a significant moderating effect on financial literacy and pension decision making of the NRPP.

Financial literacy can improve the participation behavior of households in rural areas (dynamic effect) and promote their current and long-term participation in the NRPP, choosing a higher pension contribution level in the NRPP. However, financial literacy has no significant effect on the change in the contribution amount of the NRPP. Further research finds that high financial literacy has comparative advantages in household pension decision making in rural areas. There are gender and regional differences in the impact of financial literacy on pension decisions. In addition, effective financial literacy education enhances the current, long-term and dynamic impacts of residents' financial literacy on NRPP participation and pension contributions.

This study comprehensively considers the impact of financial literacy on pension decision making behavior from three aspects: current, long-term and dynamic, making up for the dearth in the existing literature that only focuses on the impact of financial literacy on current financial behaviors and bridging the gap between the theoretical framework and experimental results. Our study proposes new policy implications: (1) Governments and financial institutions should pay attention to financial literacy and education levels in rural areas and carry out financial education and training programs to increase social welfare levels by increasing rural residents' participation and pension contribution. (2) The community can strengthen the policy advocacy of the NRPP and make people develop a stronger sense of trust toward it. The government can also subsidize individual accounts through financial support.

This study comprehensively considers the impact of financial literacy on pension decision-making behavior from three aspects: current, long-term and dynamic, making up for the dearth in the existing literature that only focuses on the impact of financial literacy on current financial behaviors and bridging the gap between the theoretical framework and experimental results. Our study proposes new policy implications: (1) Governments and financial institutions should pay attention to financial literacy and education levels in rural areas and carry out financial education and training programs to increase social welfare levels by increasing rural residents' participation and pension contribution. (2) The community can strengthen the policy advocacy of the NRPP and make people develop a stronger sense of trust toward it. The government can also subsidize individual accounts through financial support.

Economic policy uncertainty (EPU) has huge impact and harm on real economy, so the economic logic and other economic effects behind this must be further studied. By constructing the “China Economic Policy Uncertainty Index” to capture the degree of EPU faced by Chinese companies, the authors empirically test whether and how EPU affects the level of executives' perquisite consumption.

This study investigates the relationship between EPU and executive perquisite consumption based on a sample of 3,185 publicly listed firms in China. To examine the relationship between EPU and executives' perquisite consumption, a mixed least squares method was used for regression. To alleviate the problem of missing variables that do not change over time and control the influence of unobservable individual heterogeneity at the firm level, the firm fixed effects model is used for regression.

The study finds that EPU is positively associated with executive perquisite consumption. This positive association is stronger for firms with smaller size, lower management shareholding and higher levels of separation of ownership and control. Effective external governance (i.e., analyst coverage, media coverage, auditor and market competition) can mitigate the relationship between EPU and executive perquisite consumption. Further analysis reveals that EPU increases executive perquisite consumption by holding more cash and decreasing firm risk taking. EPU hurts market value of firms by boosting executive perquisite consumption and tunneling.

In an environment with high EPU, the board of directors should reduce managers' compensation performance sensitivity to ease the agency conflict caused by uncertainty. Firms should improve their governance mechanisms and standard and pay attention to their environmental changes. Policymakers should pay attention to maintaining the continuity and predictability of policies, stabilizing the economic policy expectations of market entities and avoiding frequent changes in policies that can harm economic and firm value. The regulatory authorities should actively guide listed companies to increase active information disclosure during periods of high policy uncertainty.

This study contributes to the research on corporate governance by showing how EPU influences executives' behaviors. The authors advance relative studies by showing that this uncertainty embedded in a firm's external environments influences executive perquisite consumption. This study also contributes to the literature on how internal and external governances influence corporate behavior during uncertainty. These findings extend this line of research by suggesting that effective external governance is an attribute that can alleviate the effect of uncertainty on managers' opportunistic behaviors.

Financial asset return series usually exhibit nonnormal characteristics such as high peaks, heavy tails and asymmetry. Traditional risk measures like standard deviation or variance are inadequate for nonnormal distributions. Value at Risk (VaR) is consistent with people's psychological perception of risk. The asymmetric Laplace distribution (ALD) captures the heavy-tailed and biased features of the distribution. VaR is therefore used as a risk measure to explore the problem of VaR-based asset pricing. Assuming returns obey ALD, the study explores the impact of high peaks, heavy tails and asymmetric features of financial asset return data on asset pricing.

A VaR-based capital asset pricing model (CAPM) was constructed under the ALD that follows the logic of the classical CAPM and derive the corresponding VaR-β coefficients under ALD.

ALD-based VaR exhibits a minor tail risk than VaR under normal distribution as the mean increases. The theoretical derivation yields a more complex capital asset pricing formula involving β coefficients compared to the traditional CAPM.The empirical analysis shows that the CAPM under ALD can reflect the β-return relationship, and the results are robust. Finally, comparing the two CAPMs reveals that the β coefficients derived in this paper are smaller than those in the traditional CAPM in 69–80% of cases.

The paper uses VaR as a risk measure for financial time series data following ALD to explore asset pricing problems. The findings complement existing literature on the effects of high peaks, heavy tails and asymmetry on asset pricing, providing valuable insights for investors, policymakers and regulators.

How to realize social capital “exit from virtual to real” has become not only a hot issue that elicited economists' and the practice field's concern but also a key economic structure problem that the government has to solve urgently. The main purpose of this study is to explore effective methods for social capital to “exit from virtual to real”.

The study investigates the realization path of social capital's “exit from virtual to real” by using firm theory and data from the National Bureau of Statistics in China. Provincial panel data are also utilized to empirically test the impact of social capital's de-realization to virtual (or from virtual to real) on economic development and whether the path of social capital “from virtual to real” is valid.

This study analyzes the development status of social funds serving the real economy and the hazards of social funds' “exit from real to virtual,” which are mainly viewed as eroding the development of the real economy and causing operating difficulties. On the basis of firm theory, the internal motivation for why social funds flow to the real economy is explored from the perspectives of the needs of the real economy, price and profit. Moreover, this study designs a path for returning social capital to the real economy.

Overall, expanding aggregate demand while providing an effective supply and implementing a proactive fiscal policy that focuses on structural tax cuts while keeping margins in the virtual economy are appropriate for promoting the competitiveness of the real economy.

This study explores a topic, namely, social capital “exit from virtual to real,” that has received little attention. It provides an in-depth discussion of the following questions. (1) What is the current situation of social capital serving the real economy? (2) What kind of harm can social capital bring to society? What are the inherent barriers to the flow of social capital to the real economy? (3) At this stage, how can the effective transformation of social capital into the real economy be realized? The findings help in understanding the sustainable entrepreneurship concept, particularly in developing countries.

This work aims to address source and dynamics of institutional change. It seeks to develop analytic tools by adaptation of Schumpeterian notion on entrepreneurship, Nelson's work on basic institutions and specific institutions, and Nonaka's middle‐up‐down framework of knowledge management in contrast to top‐down process. Pragmatically it attempts to understand how to improve policy capacity that challenges China seriously.

The work adopts a detailed case study method. A paired case is chosen with the criteria that they have widespread impact in China, and are representative of general and specific institutional change, respectively. Data came from mixed sources: field work and publications. Comparison of the paired cases identifies similarities and differences of different institutional change.

Similarities in the cases are in the important role of institutional entrepreneurs, crucial necessity of field experimentation, and regulatory and legislative means of knowledge processing. Differences are that centralized “top‐down” process of knowledge development, together with committed and centrally guided field experimentation, characterizes general institutional change. In contrast, coordinated and distributed “middle‐up‐down” process, together with autonomously emerged creation at the grassroots, characterizes specific institutional change.

This is a new research area. Many more empirical and theoretical works are needed.

As to how China should improve policy capacity, the study indicates: to focus policy learning on specific parts and facets of institutional settings; to change policy‐makers' role from omni‐competent controller to catalyst/promoter of institutional change; to assign an active role to middle levels and allow broader participation and diverse experimentations.

The author explores interesting details of institutional entrepreneurship and institutional changes based on the two case studies. This work fills the gap of how to analyze institutional change from the innovation/innovation systems perspective.