The "Red May" Effect in the Chinese Stock Market
Eric Girardin
Zhenya Liu
Economic Consequences of Financial Globalization in China
Nader Nazmi
Money and Price Relationship in China
Hua Yu Sun
Yue Ma
Price Reactions to Cash Dividend Announcements: Empirical Evidence From the Chinese Stock Market
Simon S. Gao
Emilia Xu
Jane Zhang
Foreign Direct Investments in the Asian Region: competition or complementarity?
Chinese TVEs Facing New Challenges: Lessons from a case study
Professor Ian G. Cook
Dr Hantang Qi
Impact of Capital Structure on Agency Costs in Chinese Listed Firms
Hongxia Li
Strategic Thinking of IP issues for Developing Countries – A case study of the battle between Microsoft and Linux in China
Dr. Xiaobai Shen
Private Sector and Urban Unemployment Flows in China
Zhongmin Wu
Organization Development in Chinese State-owned Commercial Banks: A developing organizational development perspective
Maurice Yolles and Kaijun Guo
R&D, Human Capital and Labour Productivity: Evidence from 53 high-tech development zones in China
Knowledge Migration, Informatization and WTO in China
Maurice Yolles
Paul Iles
The Impact of Bank Ownership on Technical Efficiency in China
Aying Liu, Rose Y.H. Li, and Zongyi Zhang
Consumption and Stock Markets in Greater China
Xiaohui Liu
Chang Shu
Do Chinese stock markets share common information arrival processes?
Philip Kostov, Ziping Wu and Seamus McErlean
Stock return volatility and trading volume relation - Evidence from the Chinese stock market
Ping Wang
Long Run Performance of Chinese A share IPOs: Some Empirical Evidence from Shanghai and Shenzhen Stock Exchanges
Zhang Xin
China’s Joint Venture Accounting and Its Impacts on Chinese Accounting Reforms
Simon S. Gao
Gordon S.Y.Guo
Jane J. Zhang
Long-term Underperformance: Evidence from China’s Stock Markets
Gradual Opening and the Evolving Geography of FDI in China
The impact of FDI on productivity of China’s automotive industry
Ping Zheng, Gianluigi Giorgioni, and Pamela Siler
China’s WTO Accession and Continuous Inflow of FDI: Solutions to China’s Imbalanced Economic Growth
Nadeya Aljabri and Christopher S.P. Tong
Does foreign direct investment enhance Hong Kong export performance?
Ray Barrell, Amanda Choy, Sylvia Gottschalk and Dawn Holland
Production Sharing between China and Southeast Asia: evidence from the IT industry.
Alessia Amighini
Is the Relationship between Inward FDI and Spillover Effects Linear? An Empirical Examination of the Case of China
Peter J. Buckley, Jeremy Clegg and Chengqi Wang
Strategy of multinational enterprises in China-The conditions for success or failure of multinational enterprises’ implantations in China
Min Zhao
Trade Orientation and Mutual Productivity Spillovers between Foreign and Local Firms in China
Xiaming Liu and Bo Liu
Yingqi Wei
Foreign Direct Investment in China: The entry mode choice. Evidence from the Italian Case.
Valeria Gattai
Say Goodbye to the Joint Venture? The case of UK FDI in China
World Textile in Free Trade Regime
Dr. Ayub Mehar and Abdul Hayee
Ownership, Market Structure, and Industrial Performance: Evidence from Chinese Industrial Census Data
Jinghai Zheng
Xiaoxuan Liu
Arne Bigsten
HONG KONG HOUSING MARKET: AN ECONOMETRIC MODEL
Ray Barrell, Amanda Choy, Dawn Holland and Sylvia Gottschalk
Price Risk Control and Risk Transfers in Grain and Pig Production In China in 1990-2002
Dr. Ziping Wu
Transition of Mainstream Competition with Increasing Level of Contest and Business Growth in the Beer Market in China
Chinese Industrial Sector: Recent Reforms and Perspectives
Mario Biggeri and Giovanna Hirsch
Sustainable Development, Growth, Trade and Income Distribution & Poverty: Some Issues and Relationships
Somesh.K.Mathur
Excess Investment Demand and Efficiency Loss during Reforms: The Case of Provincial-level Fixed-Asset Investment in China
Duo QIN
Haiyan SONG
Domestic Market Fragmentation and Economic Growth in China
Sandra PONCET
Protectionism and Regional Specialization in China’s Industries
Provincial Migration in China
Opening-up or Institutional Development? Evidence from China
Yu CHEN*
The "Red May" Effect in the Chinese Stock Market
Eric Girardin
GREQAM
Université de la Méditerranée
Aix-Marseille II
Aix en Provence, FRANCE
Email:
Zhenya Liu
PEOPLE'S University of China
Beijing, P.R.China
The University of Birmingham
Birmingham,UK
Email:
This paper examines anomalies in the form of seasonal profit opportunities in the China A-share stock markets. In order to discover such inefficiencies, we studythe monthlyreturns pattern over the 1995-2002 period. We find no evidence of seasonal unit roots. Deterministic seasonality appears as a very strong feature with evidence of seasonal trends. It is found that returns are consistently higher in June than in any other month on both the Shanghai and the Shenzhen stock market. This is the so called "May Effect". Such effects are robust when account is taken of the possible sources of such anomalies, such as the failure to allow for the influence on returns of risk, and growth news. Finally, we study the implications of such seasonal patterns, in particular whether they give rise to profit opportunities, when account is taken of the cost of borrowing.
Economic Consequences of Financial Globalization in China
Nader Nazmi
Hollender Professor of Economics
Lake ForestCollege
555 N. Sheridan Road
Lake Forest, IL60045
Tel: 847-735-5147; Fax: 847-735-6291; Email:
By joining the World Trade Organization (WTO) at the end of 2001, China committed to liberalizing trade and investment and opening up its markets to foreign participation. This paper focuses on macroeconomic consequences of the integration of China’s financial sector into the world economy. It highlights key likely short-term and long-run outcomes of financial globalization in China. It argues that short-term impacts would include an end to China’s deflation and a realignment of renminbi. Over a longer time horizon, the anticipated reform in China's financial and banking systems will result in faster rates of economic growth.
Money and Price Relationship in China
Hua Yu Sun
Associate Professor in Economics,
Department of Economics,
University of International Business and Economics, Beijing, China
Email:
Yue Ma
Associate Professor in Economics
Dept of Economics,
LingnanUniversity, Tuen Mun, Hong Kong
Fax: +(852) 2891 7940; Tel +(852)2616 7202; Email:
Internet:
This paper tests the Granger causality from money to price in China since 1990s. This period is chosen for a number of reasons. The Chinese economy experienced both a historical double-digit inflation in the mid-90s and unprecedented deflation in the late 1990s and early 2000s. The People's Bank of China, which is the Central Bank of China, has been trying to adopt an active monetary policy to reduce inflation and contain deflation. However, there remains an open issue whether its policy is effective. We formally investigate the effectiveness monetary policy in the two regimes of inflation and deflation, respectively, via the vector auto-regressive (VAR) models. One of the biggest challenges in our research is frequent structural changes in the Chinese monetary system. This implies that both the lags and the parameters of the VAR model are not constant over time. Therefore we apply the surplus lag estimation recursively to conduct our Granger causality tests from money to price. The main findings of the paper are that the monetary policies have become impotent to the price level in the deflation era started from 1998. This conclusion is consistent the recent development of the neo-Keynesian macroeconomic model which predicts that the expansionary monetary policies are less effective in an environment of deflation.
Price Reactions to Cash Dividend Announcements: Empirical Evidence From the Chinese Stock Market
Simon S. Gao
Professor of Accounting and Finance
School of Accounting and Economics
NapierUniversity, Sighthill, Edinburgh EH11 4NB
Phone: 0131-4553351; Fax: 0131-4553575; Email:
Emilia Xu
Senior Manager, Investment Banking Dept, China Southern Securities Co. Ltd.
9~ Floor, HuashiPlaza, No. 16, Financial Street, Xicheng District, Beijing, China 100032.
Phone: 86-10-66212491; Fax: 86-10-66210025; Email:
Jane Zhang
Senior Lecturer in Accounting and Finance, SunderlandBusinessSchool, University of Sunderland, St Peter’s Way
Sunderland SR6 0DD
Phone: 0191-5152495; Fax: 0191-5152308; Email:
The primary aim of this paper is to investigate price reactions to cash dividend announcements of Chinese listed companies with a view to testing whether or not there is an association between dividend announcements and the changes of share prices in the Chinese stock market. The study is based on 232 observations from the final sample of 37 companies. The initial sample comprises all 64 Beijing listed companies on the SHSE, which represent over 57 per cent of all listed companies on the two stock exchanges from Beijing during the period under study. This paper has found a negative price reaction to the cash dividend decrease announcement and omission. However, there is no evidence that stock prices react favourably to the announcements of cash dividend increases and initiations. Although this finding is different from the results of some studies based on other markets, it comes as no surprise given the specific features of the Chinese stock markets. Cash dividends have not been well received in a comparison with stock dividends by the mass investors due to tax differences and shortage of tradable shares in the market.
Foreign Direct Investments in the Asian Region: competition or complementarity?
Dr. Haico Ebbers
ChinaEuropeInternationalBusinessSchool
Shanghai
And
Nyenrode Universiteit, the Netherlands
Email:
Jianhong Zhang
University of Groningen
The Netherlands
Email:
In contrast to two decades ago, when a foreign firm acquiring a Chinese firm was forbidden, Chinese government has realized the importance of cross-border M&A in Chinese economic development and gradually improved the investment environment. Chinese government has loosened controls on cross-border M&A by promulgating some regulations and measures. More complete and stable regulations and implementing rules with respect to M&A are expected to be work out in the near future. This improvement of the investment environment will inevitably reduce the cost of M&A. Obviously; Chinese location advantage has been increasing, which will provide more opportunities for Multinational enterprises (MNE) to combine their Ownership and Internalisation advantages through cross-border M&A.
Clearly, the countries in Asia are competing for the same foreign resources from Western Europe and the increase of the location specific advantage of China, due to liberal and transparent M&A legislation, may divert investments from other Asian countries.
The argument of the paper is that many L advantages will converge due to economic development in the Asian region and because of harmonising economic policies. This will make government policy the essential L factor; government policy will be the main factor to differentiate from other countries and to attract FDI.
Chinese TVEs Facing New Challenges: Lessons from a case study
Professor Ian G. Cook
School of Social Science
LiverpoolJohnMooresUniversity
Henry Cotton Campus
15-21 Webster Street
Liverpool L3 2ET
Tel: 0151 2314078; Fax: 0151 2314359; E-mail:
Dr Hantang Qi
BusinessSchool
University of Greenwich
Old Royal Naval College
Park Row, Greenwich
London SE10 9LS
Tel: 020 83319867; Fax: 020 83319005; E-mail:
ChineseTownship and Village Enterprises (TVEs) have been a significant element in the transformation of China from a rather closed collectivized peasant society in the Maoist period to a modern outward-looking marketized economy under the leadership of Deng Xiaoping and his successors. This paper summarizes the role of TVEs in China’s development trajectory. It then utilizes an original in-depth case study of a successful TVE in order to tease out the specific factors that underpin the growth of TVEs. The methodology underpinning this use of a case study is explained. Factors underpinning the success of this TVE include the role of central government policy, local government initiatives, market conditions, the role of finance, and entrepreneurial skills. Today, especially following China’s entry to the WTO in December 2001, TVEs face an uncertain future. They will, inter alia, be required to increase their capitalization, size of enterprise, international networking and links, managerial and technological expertise in order to cope with the increased competition that WTO entry will bring.
Impact of Capital Structure on Agency Costs in Chinese Listed Firms
Hongxia Li
HarbinUniversity of Science and Technology
China
Visiting scholar at ACABAM
AstonBusinessSchool
This study examines the impact of capital structure on agency costs in 211 non-financial Chinese listed companies for the period 1999-2001.There are two main findings. (1) Firms with a high debt-to-asset ratios have high sales-to-asset ratios and high return-on-equity ratios. If a firm has a high debt-to-asset ratio,creditors are much concerned about the payment of interest and repayment of principal and will have incentives to monitor the firm. Thus, a capital structure with high debt decreases agency costs. (2) Positive and significant correlation is identified between ownership concentration and the return-on-equity ratio. This is because the largest shareholders have a strong interest in firm performance and therefore a high ability to reduce agency costs.
Strategic Thinking of IP issues for Developing Countries – A case study of the battle between Microsoft and Linux in China
Dr. Xiaobai Shen
School of Economics and Management Studies
University of Edinburgh
WilliamRobertsonBuilding
50 George Square
EdinburghEH8 9JY
UK
Tel. (0)131 650 3819; Fax. (0)131 668 3053; Email.
This paper uses a case study on the battle between Microsoft and Linux in China to explore the Intellectual Property issues from the perspective of developing countries.
The case examines why and how Microsoft has become strong and powerful in the Chinese market while its moral image has not. In China, Microsoft has been fighting rampant piracy for years and is now facing the challenge from the Linux - Open-Source system. However, the outcome is not yet clear. There are strategic issues for Chinese to decide. How well China understands the evolution of international IP regime in the past and the future and its impact on developing countries like China is crucial. The paper explores the underpinning rationales behind the relative success of Linux system in China and points to the problems of the current international IP regime, especially in the area of software protection.
The paper points out that the battle between Microsoft and Linux in China might have an impact on software development globally. The outcomes of the battle may as well pose great challenges to the current international IP regime. However, the stance and strategy of the Chinese government in complying with international IP protection and developing national IP regime are crucial. Its decision on adopting which system as the platform for E-governance might tip off the balance of the two sides in the battle.
Private Sector and Urban Unemployment Flows in China
Zhongmin Wu
CanterburyBusinessSchool, University of Kent at Canterbury, Kent CT2 7PE UK
Shujie Yao
MiddlesexUniversityBusinessSchool. Hendon, London NW4 4BT UK
Almost all studies of unemployment are concerned with unemployment stock rates. In this paper, attention is focused on the unemployment flows behind these stocks. Using panel data for 29 Chinese provinces and over 11 years 1988-1998, we show the patterns of inflows into, and outflow from, unemployment. To measure unemployment inflow and outflow in provinces, the approach by Junankar and Price (1984), Eriksson and Pehkonen (1998) is developed to panel data. Evidences from China suggest that private sector increase the labour market flexibility. Private firms are contributing an increasingly great proportion of government tax revenues and are providing jobs to more and more urban workers.
Organization Development in Chinese State-owned Commercial Banks: A developing organizational development perspective
Maurice Yolles and Kaijun Guo
LiverpoolBusinessSchool, LiverpoolJohnMooresUniversity, Liverpool, UK
There are major resource-based problems facing China's state-owned commercial banks as the country joints the World Trade Organisation. There is a need for organisational development and change in these banks. This need will be explored broadly in terms of a new cybernetic form of Organisational Development (OD) that involves "organisational patterning". The implications of applying such an OD approach to China's banks are discussed.
R&D, Human Capital and Labour Productivity: Evidence from 53 high-tech development zones in China
Shunlong Chen
University of UlsterJordanstown, Northern Ireland, UK
Stephen Parkinson
LeedsMetropolitanUniversity, Leeds, UK
The paper explores the relationship between labour productivity and direct technology investment, human and physical capital investment. The analysis is unique by way of its focus upon the aggregate data of 53 high tech development zones (HTDZs) in China. The study uses a broad Cobb-Douglas production function model which integrates direct technology investment (captured by R & D expenditure and employment), and human capital and physical capital. The openness (measured by export performance) and availability of infrastructure are integrated into the analysis as well. The findings reflect the ineffectiveness in explaining technology investment, human and physical capital investment as determinants of productivity growth. The paper also predicts the existence of a U-shaped curve of innovation input intensity against output performance in the Chinese context. Although restricted by the aggregate nature of the study, some broad policy implications are discussed.
Knowledge Migration, Informatization and WTO in China
Maurice Yolles
LiverpoolBusinessSchool
Paul Iles
TeessideBusinessSchool
Informatization means different things to different people, but ultimately it refers to the harnessing of information and communication technologies within organizations. It is a myth that Informatization will solve the problems that will arise with China's joining of the World Trade Organisation. Informatization will aid some situations, but it will also cause its own problems in the longer term as its implementation is not thought through or properly addressed. Organizations involved in WTO will need to pass through a transformation brought on by a paradigm change. Informatization may not be such a dramatic process however. Both cases however require an understanding of knowledge processes. Illustration of the problems of WTO will be indicated with respect to the steel industry and the banking industry, drawing on consultancy workshops held with the Everbright Bank in Suzhou and Baogang steel company in Bautou. Illustration of structured approaches to inquiry will be provided.