Union effects on performance and employment relations: Evidence from China

This paper empirically studies union effects on the performance of, and employment relations in, China's private enterprises. The study finds a positive and statistically significant union effect on labor productivity, but not on profitability. It further finds that unions lead to better employee benefits and increased contract signing in employment. These findings suggest that, in the era of transition from a centrally planned to a market economy, unions in China's private enterprises do promote workers' interests as unions do in other economies. And they do that without abandoning their traditional role of harmonizing employment relations, as required by the Party.     

自然垄断产业的产权改革与规制:我国航空运输业例证

我国航空运输产业在发展中经历了产权、竞争与规制改革。产权改革与进入规制的放松是我国航空运输业改革成功的必要条件。在这一前提下,引入竞争同时放松价格规制对产业改革的成功起到至关重要的影响。此外,少数民营公司的成功运营表明私有资本能够最大化资本的利用效果。然而,多数民营航空公司的失败案例则表明价格下限规制和优质航线的不对称进入规制等制度环境是民营资本生存和发展的最大阻碍。     

Evaluating Chinese Industrial Reforms: SOEs between Output Growth and Profit Decline

This paper evaluates Chinese industrial reforms against a background of conflicting evidence for rapid output growth and declining profitability in China's state-owned enterprises (SOEs). Using enterprise level data for various ownership forms from four coastal cities it is shown that the profitability decline in SOEs has little to do with allocative inefficiency such as excess wage payments. Rather, growing competitive pressures on the domestic market are responsible for the erosion of profit rates in Chinese industry. Industrial reforms that lead to an increase in managerial, autonomy and provide material incentives to workers can be shown to have a positive impact on enterprise profit rates. The overall favourable assessment of industrial reforms in China is qualified by substantial regional differences not covered by the sample data.     

我国上市公司绩效影响因素实证研究——来自管理者自利与债权治理的初步证据

本文以我国证券市场1998～2006年上市公司为样本,在控制其他变量的影响后,研究发现管理者自利与债权治理均显著地负向影响上市公司经营绩效。由此得到的改善我国上市公司经营绩效的两个启示:一是加强对管理者的约束,有效激励管理者;二是完善债权治理,使债权对企业管理者形成"硬约束"。     

An Equilibrium Selection Theory of Monopolization

We develop a duopoly model in which firms compete for the market (e.g., investing in process innovation or product development) as well as in the market (e.g., setting quantities or prices). Competition for the market generates multiple equilibria that differ in the firms’ investment levels, relative size, and profitability. We show that monopolization that affects competition in the market can act as an equilibrium selection device in competition for the market. In particular, it eliminates equilibria that are undesirable for the monopolizing firm, while not generating new equilibria. This result complicates the task of determining whether a firm's dominance in a given market is the result of fair competition or unlawful monopolization. We discuss a number of implications for antitrust policy and litigation, and illustrate these by means of two well‐known antitrust cases.     

Indonesia's stock market: evolving role,growing efficiency

The banking sector traditionally dominated Indonesia's financial system, and until the 1990s the stock market remained of little significance. Re-opened in 1977 after two decades of inactivity, the stock exchange made little contribution to Indonesia's development until a series of reform and deregulation measures were implemented from December 1987. This study examines the evolving role of the stock market in the financial system, and analyses changes in its efficiency over time. We find that stock market activity grew markedly in importance relative to banking after the reforms began to take effect, gaining the ascendancy in 2004 and moving well ahead subsequently. One contributor to this success is improvement in efficiency. Using two simple technical trading rules, we demonstrate that the stock exchange secondary market has indeed become significantly more efficient over time.     

ECFA背景下两岸证券市场合作的溢出效应与合作障碍

ECFA的签署与实施标志着两岸证券市场合作间接化阶段的基本结束与正常化进程的开启,给两岸证券业带来了市场开放与扩大、技术进步、人才交流和信息共享等巨大的溢出效应。但两岸证券市场合作还存在着一些障碍,这也是两岸证券市场合作需要进一步突破的方向。     

Deregulated airline markets as open access commons

Summary This paper adapts the Copes open access model of market rent dissipation to the analysis of a deregulated airline industry. It demonstrates that the open access characteristics of such airline markets lead to the dissipation of market rents. The problems of the U.S. airline system are depicted in terms of the model and some remedies are proposed.The authors are indebted to Parzival Copes and two anonymous referees for helpful comments.     

Asymmetric Regulation and Airport Dominance in International Aviation: Evidence from the London-New York Market

International airline markets have the rather unusual feature of partial deregulation with asymmetric regulatory constraints: Some carriers face entry restrictions different from others for a given route. Like domestic air travel, international travel also features hubs, where a single carrier may dominate a given airport. This article examines the effects of asymmetric regulation and airport dominance on airlines' fares in the London-New York market, a market uniquely suited for identifying the effects of both of these issues. Comparison data from the symmetrically regulated Frankfurt-New York and Paris-New York markets enable a difference-in-differences identification strategy. Regulatory restrictions are found to decrease an affected carrier's fares, whereas airport dominance increases a dominant airline's fares.     

The determinants of capital structure: Evidence from China

This paper employs a new database containing the market and accounting data (from 1994 to 2003) from more than 1200 Chinese-listed companies to document their capital structure characteristics. As in other countries, leverage in Chinese firms increases with firm size and fixed assets, and decreases with profitability, non-debt tax shields, growth opportunity, managerial shareholdings and correlates with industries. We also find that state ownership or institutional ownership has no significant impact on capital structure and Chinese companies consider tax effect in long-term debt financing. Different from those in other countries, Chinese firms tend to have much lower long-term debt.     

Multinational corporations and domestic market structure: The case of Greek manufacturing industries

Conclusions In this paper we examined the potential of MNCs to give rise or to promote concentrated markets in a host country. Foreign presence in the form of MNCs affectsdirectly the market structure of the economy by in-creasing both the relative inequalities in the size distributions of firms (entropy) and the level of absolute concentration (Herfindahl-CR4). MNCs tend to populate capital intensive sectors and may also account for a potentialindirect stimulation on the concentration process through their effects on domestic barriers to entry. Industries characterised by such horizontal FDI are likely to be able to earn and maintain supra-normal profits in the domestic market. However, the effective curb of competition caused by MNCs did not show uneven distribution of gains in profitability to be present in the market for a sample of 100 large MNCs and local firms. We should suggest that concentration and other market imperfections may be the basic factor determining profitability in Greece,not multinationality per se. Moreover, the potential indirect influence of MNCs on domestic barriers may act as an agent for promoting structural changes, especially in the capital intensive sector.     

Aviation Policy: Past and Present

Airline deregulation has been a symbol of the trend toward less expansive government over the past quarter century. The move from economic regulation to deregulation has delivered on its efficiency promises. There have been significant benefits to consumers in terms of lower prices and more convenient schedules. However, airline competition, particularly at hub airports, remains imperfect. The nature of these imperfections is explained better by models of oligopolistic behavior than by the contestability theory. Paradoxically for this industry, the terrorist attack of September 11, 2001, has ushered in an expanded role of government in aviation policy. This expanded role does not reinstate government intervention in airline economic decisions. Rather, it provides financial stabilization (bailout and loan guarantees) of the industry in the short run and long-term structural change in aviation security.     

Financial Deregulation and the Cost Structure of State and Private Banks in Indonesia: Some Evidence from Microeconomic Data

Since the major deregulation of Indonesian banking in the late 1980s the quality and availability of local banking services has significantly expanded. But controversy continues over the impact of deregulation on the industrial structure of banking in Indonesia. This paper uses micro data to examine the impact of deregulation on the costs and profitability of the state commercial banks in comparison with a benchmark sample of relatively efficient private banks. The sample period covers both the pre- and post- deregulation eras. The study finds that deregulation had a strong impact At the private banks, large cost reductions have been passed on to customers in the form of narrower intermediation margins By contrast, margins have barely changed at the state banks. Profitability measured in relation to equity has fallen significantly, especially at state banks For recent years, the margins are not out of line with available data on international comparators.     

Corporate Tax Aggressiveness and Insider Trading

We examine the association between corporate tax aggressiveness and the profitability of insider trading under the assumption that insider trading profits reflect managerial opportunism. We document that insider purchase profitability, but not sales profitability, is significantly higher on average in more tax aggressive firms. We also find that the positive association between tax aggressiveness and insider purchase profitability is attenuated for firms with more effective monitoring and is accentuated for firms with a more opaque information environment. In addition, we provide empirical evidence that tax aggressiveness is significantly associated with greater insider sales volume in the fiscal year prior to a stock price crash. Finally, we find that the association between tax aggressiveness and insider purchase profitability weakens after the introduction of FIN 48, consistent with the increased transparency of tax positions under the new disclosure requirement reducing insiders' information advantage and hence their ability to profit from insider trading. To the extent that insider trading profits reflect managerial opportunism, our results are consistent with managers exploiting the opacity arising from tax aggressive activities to extract rent from shareholders, particularly those shareholders who sold their shares to the managers. Our findings are particularly important in light of the number of studies relying on the agency view of tax avoidance to develop arguments or to draw inferences.     

The Impact of APROC on Taiwan's Economy: A CGEAnalysis of Deregulation

The Taiwan Government defines the Asia-Pacific Regional Operations Center (APROC) project as designed 'to transform Taiwan into a regional economic center through overall liberalization and internationalization'. From this definition and the targets of APROC as set by the Taiwan Government, it is not difficult to see that deregulation is one of the basic means of achieving its goals. In this paper, we use a computable general equilibrium (CGE) model to evaluate the possible effects of this deregulation. The effects of deregulation on the economy go through four channels in the model: (i) deregulation liberalizes the market; (ii) deregulation moderates factor market distortion; (iii) deregulation attracts foreign investment, speeds up capital accumulation and enlarges capital stock in Taiwan; and (iv) deregulation attracts foreign investment and hence improves technology. Six simulations are conducted in this paper. All of the simulations show positive effects on Taiwan's economy as a whole, while for individual sectors the effects are various.     

Assessing the gains from deregulation in Japan's international telecommunications industry

The Japanese government terminated the monopoly of international telecommunications service by Kokusai Denshin Denwa (KDD) as part of the regulatory reform in telecommunications in 1985. Two new carriers entered the market in 1989. In defending its market share, KDD intensified cost reduction efforts and accepted lower profitability in order to carry out a series of sharp rate reductions. I have assessed the size of the net welfare gain associated with the deregulation. Deregulation brought about a 22.2% fall in KDD's unit cost for the eight-year period ending in 1992. Because this efficiency gain was fully passed along to telephone users in the form of lower rates, the corresponding increment of consumer surplus was of significant size, equivalent to 25.6% of total international telephone call revenues in 1992. (JEL L95, O53)     

FDI Deregulation Versus Labor Market Reform: a Political Economy Approach

This paper studies the political economy of foreign direct investment (FDI) in interaction with labor market policies. It analyzes the setting of reform focused on deregulating labor markets as a political compromise pressured by the lobbying of an industry lobby and a trade union. Using a common agency model of lobbying, we show that the interest group’s influence is socially distortive towards less deregulation. Also, our political economy framework shows that, for large countries, exogenous FDI liberalization policies lead to deregulation in the labor market. For small countries, such policies enhance more labor market rigidities.     

中、外大型零售企业的竞争力比较分析

随着国际零售业巨头全面进入我国,中国本土大型零售企业面临激烈的竞争,本文就中国零售企业与国际零售企业之间在盈利能力、管理水平、自有品牌、规模、技术水平等方面的差距进行讨论后,并提出了缩小这些差距的对策。     

Deposit market deregulation,implicit deposit rates,and monetary policy

Conclusion Previous analyses of the economic effects of deposit market deregulation generally have treated the gradual elimination of deposit rate ceilings and the effective removal of barriers to bank competition for deposits as separate issues. The key implication of the analysis utilized in this paper is that there are important interactions between these two forms of deposit market deregulation and their ultimate effects on market behavior and outcomes. One aspect of this interaction concerns the payment of implicit interest on deposit balances. Although implicit interest payments usually are viewed as a response to the imposition of ceilings on explicit deposit rates, the amount of implicit interest paid by banks in fact depends crucially upon the amount of monopoly power available to banks as a result of entry restrictions. Competition in deposit markets drives the implicit interest rate to 0 even if the explicit deposit rate is regulated, and the existence of imperfect competition in deposit markets makes the payment of positive implicit deposit interest a theoretical possibility even if the explicit deposit rate ceiling is removed.At a macroeconomic level, increased bank competition enhances the monetary and interest rate impacts of gradual relaxations of a binding deposit rate ceiling. If a ceiling on the explicit deposit rate is present, increased bank rivalry for deposits resulting from deregulation reduces monetary control whether the Fed targets a market interest rate or a reserve aggregate. When there is no ceiling on the explicit deposit rate, increased bank competition has ambiguous implications for monetary policy.The present trend in regulatory policy is pushing the U.S. financial system toward an environment in which explicit deposit rates are flexible, market determined variables and interbank rivalry for deposit funds is much more competitive. The thoretical analysis of this paper indicates that the likely results of these simultaneous developments are the demise of implicit deposit interest (marginal cost pricing of transactions services) and potential complications for the c onduct of monetary policy under either a reserve-oriented operating procedure or a procedure in which the Fed targets a market interest rate. However, the directions and magnitudes of the net impacts of those forms of deregulation ultimately are empirical issues that cannot be fully resolved.via a theoretical analysis.An earlier version of this paper was circulated by the Federal Home Loan Bank Board's Office of Policy and Economic Research as Invited Research Working Paper No. 59. The author is grateful for comments received from Donald Bisenius, Michael Bradley, Richard Brown, George Kanatas, Kenneth Kopecky, Byungkyu Lee, Randall Merris, Douglas Mitchell, Steve Peterson, Richard Startz, Richard Sweeney, Bill Witte, and participants in the Indiana University Money and Banking Seminar. Views expressed in this paper do not necessarily correspond to those of the Federal Home Loan Bank Board or the Board of Governors of the Federal Reserve System. Any errors are the author's alone.     

美国航空运输业市场结构演变及其政策启示

本文详尽描述了20世纪70年代中期以来美国航空运输业市场结构的演变过程,并运用产业组织中的SCP分析框架,全面分析了美国航空运输业市场结构演变的原因,最后总结出促进我国航空运输业发展的政策启示,如坚持民航产业政策的有效性和灵活性、重视航空运输企业国际竞争力的培育、鼓励低成本航空公司的发展和完善基于市场细分的分工协作体系等。