JOURNAL OF ZHONGNAN UNIVERSITY OF ECONOMICS AND LAW

No.2.Mar.15，2016

HIGHLIGHTS

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JOURNAL OF ZHONGNAN UNIVERSITY OF ECONOMICS AND LAW

No.2.Mar.15，2016

HIGHLIGHTS

Economic Explanation Paradigm: Another Synthesis of Economic Thought History

GAO Shaohui1LUO Biliang2HE Yiming1·3·

(1.SchoolofEconomicsandManagement,SouthChinaAgriculturalUniversity,Guangzhou510642,China; 2.Research

CenterofGuangdongAgriculturalEnterpriseDevelopment,SouthChinaAgriculturalUniversity,Guangzhou510642,China)

Abstract:Steven Cheung’s economics which bases on individual benefits maximization of New Classical Economics as internal core and adding some constraint conditions such as transaction costs, property rights and contract as protective belts, derives a series of testable hypothesis in order to get the general paradigm of economic explanation. It follows the fundamental assumptions of stable preference and rational choice in Mill Paradigm and Marshall Paradigm, but it adds the Coase Revolution of transaction costs constraint. As a result, its explanation capability is beyond Samuelson Paradigm and New Keynes Paradigm. So, Economic Explanation Paradigm is the same with Mill Paradigm, Marshall Paradigm, Samuelson Paradigm and New Keynes Paradigm, which should be considered to be an important synthesis in the history of economic thought. The appropriateness of technology choice and factor endowment is the key factor of increasing cross-country income disparity and technology gap. Based on the development track of the mechanism of appropriate technology choice, this paper systematically settles localized technological innovation theory, induced technological innovation theory, directed technical change theory and appropriate technology choice theory; and evaluates the role of capital deepening, heterogeneous labor and institutional constraints on the appropriate technology choices and cross-country productivity differences. On the basis of summing up the limitations of the existing literature, this paper points out the research frontier of appropriate technology choices. Theoretically, if the money velocity is relatively stable, a greater growth rate than the economy for money supply will inevitably lead to price rising. As commodity and service tax are taken as the main taxes in the taxation structure, it will necessarily have a direct impact on tax revenue. This paper constructs the co-integration model to confirm the existence of positive linkage between money amounts, price-level and tax revenue, and if the consumer price index has not been undervalued, the linkage will become more significant. In the current context of the new-stage for economy, the government should strive to reduce of the proportion of commodity and service tax, in order to directly reduce the tax burden on enterprises and residents, and induce monetary funds in the real-estate or stock market to flow to the real economy. And it also should effectively control the currency issue and the scale of bank liquidity creation to a reasonable level so as to match with the economic growth and reduce the potential risk of inflation. The strategy deviance leads to the rise of corporate risk, and then it will affect its financing activities. This paper discusses the relationship between strategic deviance and bank loan contracts. The study finds that greater strategy deviance will lead to higher interest rate, the shorter term and the less amount of the enterprises bank loan. Further research finds that the above relationship is only maintained in the enterprises which management team is relatively young, management holding is relatively low and management education is relatively low. It indicates that the bank takes enterprise strategy deviance into consideration when assessing risk, and management human capital and social capital can ease the deterioration of bank financing caused by strategy deviance. It reveals that both strategic information and management characteristics have a momentous influence on bank resource allocation. It also has some meaningful recommendation for enterprise strategy choice. Firstly，we analyze the process and mechanism of executive compensation formulation impacted by management power through the selection of the compensation benchmark. And then, we verify the impact of managerial power on the listed companies’ executive compensation based on the A-share listed companies from 2011 to 2014 and explore the mediating role of compensation benchmark between executive compensation and management power. The results show that the management power and compensation benchmark are both positively correlated with executive compensation. And we find that one possible way influencing compensation formulation used by listing corporation executives is through the influence of the board of directors on the choice of compensation benchmark so as to achieve the purpose of manipulating their own executive compensation. More and more Chinese and foreign scholars are focusing on China’s OFDI. What is the research’s contribution to international business theory innovation and reconstruction? This article is a literature review which is based on 14 kinds of academic journals. This paper generalizes the theory innovation of the research to China’s OFDI from three perspectives: The motivation of China’s OFDI, China’s MNEs’ advantage and Chinese firms’ internationalization strategy. Then it reconstructs the kinds of OFDI, MNEs’ advantage and the essence of internalization. This paper enriches international business theory and point out the direction of further study. From the perspectives of firm’s internal management and external environment, this paper investigates the impacts of governance cost and market competition on firm productivity, and further studies the marginal role of human capital playing in the impacts from the perspective of moderator effects and mediator effects. Using the dataset of Chinese industrial firms, we draw several conclusions through the fixed effects regression model. First, governance cost has a significant negative effect on productivity in both SOEs and NSOEs; however, market competition promotes NSOEs’ productivity while reducing SOEs’ productivity. Second, in NSOEs, human capital marginally promotes firm productivity, and also mediates the relationship between corporate governance and productivity; while in SOEs, it only moderates the effect of market competition slightly. Overall, this study offers clear policy implications, which could help the government release appropriate policies to improve corporate governance and industry competition, and distribute human capital more effectively in firms with different ownerships. Using investment and price data in China's grain production from 1991 to 2013, this paper empirically analyzes the factor demand and the substitution relations between factors in grain production against the background of labor costs rise through the estimation of shadow elasticity of substitution in translog cost function. The study fiunds that: (1)The factor demand of grain production is in a rational price adjustment range, and factor price is still the economic leverage adjusting factor needs; (2)There is an obvious substitution relation between agricultural machinery and labor, which means that using machinery to replace labor can significantly reduce agricultural labor input and effectively alleviate the constructive shortage of labor force caused by the selective transfer of labor force; (3) The substitution relation also exists between fertilizer and labor. In order to choose more-amount-and-less-times fertilizing style and to increase chemical fertilizer application while reducing the farmyard manure input, replacing labor with fertilizer should be a rational choice of the farmers in the consideration of rapidly rising labor costs.

Key words:History of Economic Thought; Synthesis of Economics; Economic Explanation; Research Paradigm; Mill Paradigm; Marshall Paradigm; New Keynes Paradigm; Samuelson Paradigm; Steven Cheung’s Economics Factor Endowment; Technical Change; Appropriate Technology Choice; Capital Deepening; Heterogeneous Labor Money Supply; Price-Level; Commodity and Service Tax; Tax Burden Corporate Strategy; Strategic Deviance; Enterprise Risk; Management Characteristics; Bank Loan Contract Management Power; Compensation Benchmark; Executive Compensation; Compensation Chinese firms; OFDI; Theory Innovation; Internationalization Corporate Governance; Market Competition; Productivity; Property Right; Human Capital Factor Substitution; Labor Cost;Shadow Elasticity of Substitution;Translog Cost Function

Review on the Appropriate Technology Choice in Backward Countries

YUAN Li1WANG Linhui2·11·

(1.SchoolofEconomics,NortheastNormalUniversity,Changchun130117,China;2.Schoolof

Business,EastChinaNormalUniversity,Shanghai200241,China)

Research on the Linkage between Money Supply, Price and Tax Revenue

PANG FengxiZHANG Liwei·21·

(SchoolofFinanceandTaxation,ZhongnanUniversityofEconomicsandLaw,Wuhan430073,China)

Strategic Deviance, Management Characteristics and Bank Loan Contract from the Perspective of Risk Taking

LI ZhigangSHI Xianwang·68·

(SchoolofAccounting,ZhongnanUniversityofEconomicsandLaw,Wuhan430073,China)

Management Power, Compensation Benchmark and Executive Compensation

REN Guangqian78·

(SchoolofBusiness,ZhengzhouUniversity,Zhengzhou450001,China)

Formulation

China’s OFDI and the Breakthrough of OFDI Theory: A Literature Review and Research Trends

LIU XiamingWANG JueLU Jian·86·

(SchoolofInternationalBusiness,SouthwesternUniversityofFinanceandEconomics,Chengdun611130,China)

Governance Cost, Market Competition and Productivity

XU Mingli1PANG Lirang1WANG Li1KONG Dongmin2·130·

(1.SchoolofEconomics,HuazhongUniversityofScienceandTechnology,Wuhan430074,China;

2.SchoolofFinance,ZhongnanUniversityofEconomicsandLaw,Wuhan430073,China)

The Demand and Substitution Relations of Grain Production Factors

WU LiliLI GuchengZHOU Xiaoshi·140·

(1.SchoolofEconomics&Management,HuazhongAgriculturalUniversity,Wuhan430070,China；2.Research

CenterofHubeiRuralDevelopment,HuazhongAgriculturalUniversity,Wuhan430070,China)