JOURNAL OF ZHONGNAN UNIVERSITY

OFECONOMICSANDLAW

No.2.May15，2020

HIGHLIGHTS

WhetherDeleveragingTaskConflictswithIndustrialPolicy：
AnEmpiricalStudyBasedonEnterprises’DebtStructure

YANG Yulong1WANG Feng2

·3·

(1.SchoolofAccounting,ZhejiangGongshangUniversity,Hangzhou310018,China;
2.SchoolofEconomicsandManagement,TongjiUniversity,Shanghai200092,China)

Abstract:Based on A-share companies listed on Shanghai and Shenzhen stock markets exchanged from 2003 to 2016, this paper studies the potential conflicts between the deleveraging task and the industrial policy. This result shows that deleveraging policy will reduce the proportion of the company's financial liabilities and increase the proportion of the company's operating liabilities. And the industrial policy will, on the contrary, increase the proportion of the company's financial liabilities and reduce the proportion of the company's operating liabilities. Moreover, deleveraging policy will reduce the financing convenience brought by industrial policies to enterprises, and cause enterprises to seek to occupy operating liabilities such as trade credits. After group testing the samples, the result also shows that the conflict between the deleveraging task and the industrial policy is mainly reflected in the sample of enterprises from the central and western regions or provinces with lower degree of marketization.

Keywords:Deleveraging Policy; Industrial Policy; Financial Liabilities; Operating Liabilities

FinancialRestatementandAllocatingAuditPartnerQuality

LIU Wenjun

·14·

(SchoolofManagement，FujianAgricultureandForestryUniversity，Fuzhou350002，China)

Abstract:Based on the data of China's listed companies from 2003 to 2017, this paper tests the impact of financial restatements on allocating audit partners quality. The study shows that audit firms are more likely to allocate higher quality audit partners to financial restatement clients, which can improve audit quality. In cross-sectional analysis, this paper shows the impact of financial restatements on allocating audit partners quality is more significant in firms with better institutional environment, lower agency costs, and shorter auditor tenure. In addition, allocating audit partners’ quality after financial restatements does not affect the earnings response coefficient and cost of capital. The results show that after financial restatements, the audit firms have a quality control system based on audit partners allocating, yet this cannot restore the reputation for the clients.

Keywords:Financial Restatement; Allocation of Audit Partners; Quality Control; Corporate Reputation

OnEstablishmentofFreeTradeZoneandCorporateTechnologyInnovation

TAN Jianhua YAN Lina

·48·

(SchoolofAccounting，ZhongnanUniversityofEconomicsandLaw，Wuhan430073，China)

Abstract:Based on the data of China's Shanghai and Shenzhen listed firms from 2012 to 2018, this paper empirically tests the impact of the establishment of the China Free Trade Zone (Free Trade Zone) on the technological innovation of firms. It is found that the patent applications filed by listed firms in the Free Trade Zone has increased significantly compared with that of listed firms that are not in the free trade zones, indicating that the establishment of the Free Trade Zone has promoted technological innovation in firms within the zones. This conclusion is still valid after using a series of robustness tests to control potential endogeneity problems. Market competition and financial constraints are the intermediary channels through which the establishment of the Free Trade Zone influences the technological innovation of firms, and they play partially the intermediary role. It is further found that the promotion effect of the establishment of the Free Trade Zone on the technological innovation of firms is reflected in non-state-owned firms and high-tech firms. This paper provides micro empirical evidences for the impact of the Free Trade Zone on the technological innovation firms within the zones accordingly, and has certain reference value in deepening the reform and opening-up policy in China at this stage.

Keywords:Free Trade Zone; Corporate Technology Innovation；Market Competition；Financial Constraints

HousePriceFluctuation,WageLevelandtheMismatchofLaborElementsamongRegions

LI Wenixiu LI Jianxin

·68·

(SchoolofEconomicsandTrade,GuangdongUniversityofFinannce，Guangzhou510521，China)

Abstract:At present, China is facing complex structural contradictions, and distortion of resource allocation is increasing and improving the efficiency of resource allocation has become a necessary way to improve long-term productivity. This paper constructs a mathematical model of labor mismatch between regions, systematically explores the impact of housing prices on regional resource allocation, and calculates the labor mismatch index of each region using panel data of China's provinces, and conducts an empirical test on the distortion of regional resource allocation aggravated by rising housing prices. In order to test the influence path of housing price on the mismatch of labor resources, this paper also establishes a mediating effect model with labor price as the mediating variable. The results show that: (1) the rise of housing prices significantly aggravates the distortion of labor resources allocation among regions. The housing prices rising in the eastern region has a more serious impact on the misallocation of resources than in the central and western regions, and the distortion of housing prices on the allocation of labor resources has become more serious with the passage of time. (2) The increase of housing price will aggravate the regional resource mismatch by raising the labor price level. Therefore, under the background of the economic restructuring economic structural transition proposed by the state, the government still needs to optimize the allocation of labor force structure, reduce the impact of housing prices on regional resource mismatch, and promote regional coordinated and balanced development under the requirements of "stabilizing land prices, stabilizing housing prices".

Keywords:House Price Fluctuation；Wage Level；Mismatch of Labor Elements；Industrial Structure；Regional Coordinated and Balanced Development

HowDoestheLocalGovernmentDebtAffecttheInvestmentand
FinancingBehaviorofEnterprises?

XU Yankun

·90·

(SchoolofEconomics,South-centralUniversityforNationalities,Wuhan430074,China)

Abstract:Based on the sample of private listed companies, this paper provides the internal mechanism and empirical evidence that local government debt affects the financing, investment and development of enterprises. It is found that: due to the crowding out effect, the high debt ratio of local government has become an important factor affecting the financing constraints of enterprises, and makes the financing cost of enterprises, especially the cost of debt capital significantly rise; in terms of investment behavior, the rising debt ratio of local government makes the investment scale of private enterprises significantly decline, and reduces the investment opportunities of enterprises, among which, private enterprises, affiliated enterprises of weak government enterprises and enterprises in areas with low marketization and legal environment，enterprises in PPP non incentive industries are more affected by local government debt, and county-level government debt in the overall debt level has the greatest impact on enterprise financing and investment behavior; Further, from the perspective of enterprise development, the leverage ratio of local government is too high, the rapid rise will aggravate the financial risk and operational risk of the local private enterprises, and the business performance will be adversely affected. Controlling local government debt, especially county-level government debt, accelerating the process of marketization and improving the legal environment will help to reduce the crowding out effect of local government debt on private economy and real economy, improve the cooperation mechanism between government and social capital, and change the crowding out effect of local government debt into the induced effect.

Keywords:Local Government Debt；Financing Constraints；Private Investment；Enterprise Financing; Enterprise Development

TheImpactofShort-TermInternationalCapitalFlowsontheEnterpriseLeverage

ZHANG Yuanjie SHI Jianhuai

·100·

(SchoolofEconomics,PekingUniversity,Beijing100871,China)

Abstract:This paper explores the impact of short-term international capital flows on the enterprise leverage by using the quarterly data of non-financial companies listed in Shanghai and Shenzhen from 2007 to 2018. The result shows that the growth of short-term international capital flows increase the enterprise leverage. Specifically, the impact on short-term leverage is higher than that on long-term leverage, and the impact on bank credit leverage is higher comparing with that on commercial credit leverage. Moreover, regarding on the ownership, it has a greater influence on the short-term leverage of private enterprise than that of state-owned enterprise, and the impact on the long-term leverage of state-owned enterprise is higher than that of private enterprise. Notably，for the listed enterprises with high financing constraints and long payback period, the promotion of short-term international capital flow on the rise of leverage is much more remarkable. The result provides a meaningful reference on how to strengthen the management of short-term international capital flows and reduce the impact of external shocks on the domestic financial market.

Keywords:Short-term International Capital Flow; Enterprise Leverage; Debt Maturity Structure; Debt Type

LandTenureStabilityandTransitionofLandRentalMarket:
EvidencefromChinaHouseholdFinanceSurvey

QIU Tongwei1LUO Biliang2HE Qinying1

·133·

(1.CollegeofEconomicsandManagement,SouthChinaAgriculturalUniversity; 2.NationalSchoolof
AgriculturalInstitutionandDevelopment,SouthChinaAgriculturalUniversity,Guangzhou510642,China)

Abstract:Securing land tenure is the precondition to develop land rental market, but few studies analyzed the effect of land tenure on the marketization of land rentals between acquaintances and they ignore the possibility that the transition of land rental market emerges. Based on data from the 2015 China Household Finance Survey and the extended linear regression and Probit regression are utilized, the paper assesses the relationship between land tenure and informal land rentals. The estimated results indicate stabilized land tenure not only increases land rentals between non-acquaintances and land rents, but also has positive impact on the for-profit land rentals between acquaintances and the land rents. The further analysis shows that 50% of the impact of land tenure on transaction partner can be explained by land rents. These findings indicate that land tenure security increases the marketization of land rentals. Our analysis implies that with the decreasing growth rate of land transfer scale, “Stabilizing Quantum, Adjusting Structure” should be the principle of developing land rental markets. At the same time, the potentially-positive effects of the new round of land titling on the transaction of land rental markets should be identified.

Keywords:Land Transfer; Land Tenure; Acquaintance Transaction; Land Rent; Market Transition