Can environmental information disclosure spur corporate green innovation?

How can the disclosure of environmental information (EID) stimulate corporate green innovation (CGI)? This research challenges the prevailing assumption that environmental regulations impact CGI by influencing corporate compliance costs. Instead, it offers a fresh theoretical framework to explain how EID affects CGI. This study combines signal theory and resource dependence theory to develop a moderated mediation model, illustrating how EID reduces information asymmetry and alleviates corporate financial constraints (CFC). To test these hypotheses, this study utilized data from A-share listed companies spanning the period 2004 to 2017. This study considered the year 2009 as a crucial point of analysis, marking the period before and after the implementation of China's first EID policy in 2008. This study employed a Difference-in-Differences (DID) model. The results reveal that EID has a positive impact on CGI by mitigating CFC, with non-state-owned enterprises (non-SOEs) exhibiting a more pronounced mediating effect. These findings remain robust even when the parallel trend assumption was tested to eliminate interference from other factors. This study unveils the mechanism through which voluntary environmental regulation, represented by EID, influences CGI by mitigating information asymmetry and alleviating CFC. These results deviate from the predictions of compliance cost theory and Porter's hypothesis regarding the impact of traditional environmental regulations on CGI, providing a fresh perspective on the role of voluntary environmental regulation in driving CGI.

ESG ratings, monetary policy uncertainty, and bond issuance premium

Existing studies generally recognize the critical role played by macro monetary policy, of which the uncertainty will increase corporate bond issuance premiums at a micro level. However, relatively little is known about these relationships from the perspective of non-financial information in the corporation. So this study sets out to do further exploration. We use the database to obtain information, including the bond issuance of A-share listed corporations in China from 2015 to 2020. The findings suggest that high environmental, social, and governance (ESG) ratings from listed corporations significantly weaken the positive correlation between monetary policy uncertainty and bond issuance premiums. Specifically, it has a positive information pricing effect on China's primary debt issuance market, as well as a mitigating impact on macro-financial policy risk. We also find, through further mechanistic studies, that ESG ratings are more helpful in undermining the impact of monetary policy uncertainty on bond issuance premiums in the context of higher financial information quality. Our findings are conducive to enriching the research framework of the economic consequences of ESG ratings, meaningfully influencing the growing literature that exposed the mechanism of bond issuance premiums, and further, verifying the interaction of information at different levels (macro vs micro) in asset pricing.

Incentive contract design considering quotas production: A principal-agent perspective

The quality of primary products in a supply chain is determined by the agent and the principal. Simultaneously, there are quota production constraints on the principals. Our discourse centers on the design of incentive contracts for agents within these supply chains. We derived the parameters describing the contract, level of effort, profits for both sides, and the minimum requirements of the principal for the proportion of high-quality primary products. This study compares the decision-making paradigms of agents and principals in various contexts. The results show that decision-making mechanisms are strongly influenced by individual effort costs, various internal and external organizational variables, and the interplay of efforts on both sides. Using numerical experiments, we investigate the effects of different situations between clients and contractors on contracting and effort strategies. The results show that when the agent exerts unilateral effort, reasonable incentive contracts can spur the agent to increase effort and thus increase the proportion of high-quality primary products. In the case of bilateral efforts, a well-calibrated contract design benefits the agent (bearing less risk). For the principal, the expected profit increases in most cases. When considering the quota production, it is necessary to set an appropriate limit on the proportion of high-quality primary products.

Impact of common institutional ownership on enterprise digital Transformation-Collaborative governance or collusion fraud?

As a crucial external capital force of enterprises, common institutional ownership plays an essential role in enterprise innovation and development. However, few studies have focused on the impact and underlying impact mechanisms of common institutional ownership on the digital transformation of enterprises. Hence, this study uses Python to analyse the annual reports of listed companies from 2007 to 2021 and constructs measures of enterprise digital transformation. Then, based on panel fixed effects Poisson regression, this study examines the influence of common institutional ownership on enterprise digital transformation by using theoretical logic and empirical evidence. The results reveal that common institutional ownership significantly inhibits enterprise digital transformation; this result remains valid after a series of endogeneity and robustness tests, thereby indicating that common institutional ownership exerts a collusion fraud effect. The mechanism analysis shows that common institutional ownership hampers enterprise digital transformation mainly by increasing monopoly power within the market, aggravating information asymmetry between enterprise insiders and outsiders, and intensifying executive self-dealing. Further analysis reveals that the inhibitory effect of common institutional ownership on digital transformation is more significantly negative in the case of non-state-owned enterprises versus state-owned enterprises. This study expands the research on the factors influencing enterprise digital transformation. The results provide a helpful reference for further improving institutional investors' ownership structures and promoting high-quality enterprise development.

Investigating recycling decisions of internet recyclers: A step towards zero waste economy

Online recycling has been recognized as an efficient method for waste recycling. This paper focuses on the information asymmetry between an internet recycler and consumers in the online transaction of used products. This paper is to find an optimal strategy for the internet recycler when the consumers would make an adverse selection in submitting the classification results (the used products would be classified into two kinds according to the quality: High quality and Low quality) of used products in online orders to avoid the loss because of internet recycler's moral hazard, which might bring the extra cost for internet recycler. Therefore, this study used game theory to establish a Stackelberg game model for analyzing an internet recycler and consumers' decision-making in the online transaction of used products. Based on the analysis of consumers' behaviors in an online transaction, internet recycler's strategies are divided into two kinds: A, high moral hazard strategy, and B, low moral hazard strategy. It is found that the strategy of low moral hazard is optimal for the internet recycler compared to the strategy of high moral hazard. Further, though strategy B is optimal, the internet recyclers is suggested to increase their moral hazard probability when the H used products are increasing (High-quality ones). Besides, for strategy B, the correction cost for wrong H orders and correction benefit from correction of wrong L orders would decrease the optimal moral hazard probability, and the impact of the correction benefit from correction of wrong L orders on the decision of moral hazard probability is more obvious.

The impact of green financial development on stock price crash risk from the perspective of information asymmetry in Chinese listed companies

Solving the crash risk problem of corporate stock price caused by information asymmetry can mitigate the negative externality of its carbon emission to become green, low-carbon, and high-quality development. Green finance generally profoundly impacts micro-corporate economics and macro-financial systems but remains a giant puzzle of whether they can effectively resolve the crash risk. This paper examined the impact of green financial development on the stock price crash risk using the sample data of non-financial listed companies in Shanghai and Shenzhen A stock market in China from 2009 to 2020. We found that green financial development significantly inhibits the stock price crash risk; this is more obvious in listed companies with a high level of asymmetric information. And companies in high-level regions of green financial development attracted more attention from institutional investors and analysts. As a result, they disclosed more information about their operational status, thus reducing the crash risk of corporate stock price from the torrential public pressure of lousy environmental details. Therefore, this study will help continuously discuss the costs, benefits, and value promotion of green finance for synergy between corporate performance and environmental performance to improve ESG capabilities.

Effects of board characteristics on information asymmetry: Evidence from the alternative investment market

This study aimed to investigate the effect of board characteristics on information asymmetry as well as examining whether the disclosure environment moderates the association between board structure and the information asymmetry of listed firms in the UK. We primarily focus on six characteristics of board composition (board size, board independence, board financial expertise, board busyness, CEO duality, and board gender diversity) and their impact on the bid-ask spread (employed as a proxy of information asymmetry). This study used the ordinary least squares (OLS) model to examine these associations. Moreover, we used system GMM and lag estimation models to test for endogeneity problems. Using a sample of 5950 observations representing the non-financial firms listed on the Alternative Investment Market (AIM) for 10 years from 2010 to 2019, we found a negative and significant relationship between board size; board independence; and female directors and information asymmetry. However, board busyness and CEO duality are positively related to information asymmetry. Furthermore, we demonstrate that information disclosure moderates the relationship between board characteristics and information asymmetry; that is, board size, independent directors, and female directors mitigate information asymmetry by improving the level of information disclosure. By contrast, busy directors and CEO duality increase the problem of information asymmetry by reducing firms' information disclosure. The results of this study have implications for UK regulators, firm boards of directors, and firm stakeholders.

Weibo users and Academia's foci on tourism safety: Implications from institutional differences and digital divide

Tourism safety is essential for tourists and tourism practitioners. This study conducted a bibliometric analysis using VOSviewer and CiteSpace for 2018 articles indexed on the Web of Science (WoS). It also analysed 7293 Weibo posts between 1977 and 2022 using Python, MYSQL, AI sentiment, and Tableau. The first tourism safety publication on WoS appeared in 1977, while the first Weibo microblog dated was dated back to 2011. Compared to the information posted on Weibo, the annual publications about tourism safety on WoS recorded a stable increment. On Web of Science (WoS), the academic staff and universities produced the largest number of tourism safety posts. On the flip side, the most productive organisations on Weibo are government agencies in popular tourism destinations. "Accident", "medical tourism", "environment", "mediating role", and "hospitality" were important burst nodes in tourism safety on WoS. "Quality", "accident", and health-related words were the foci on both Weibo and WoS. On Web of Science, the top 10 most popular keywords of tourism safety-related articles could be classified into two groups: health ("Covid-19", "restoration", "pandemics", "Sars-Cov-2", "Sars", "mental health") and IT terminologies ("big data", "artificial intelligence"). It has been concluded that "artificial intelligence (AI)" is more likely to be included in the keywords on tourism researched by academia. In contrast, the public may not know about or use AI in the tourism industry. Besides, the top 10 most popular keywords on Weibo related to tourism risks and hazards were drowning and traffic risks and hazards, such as drowning and traffic risks. The digital divide may explain such a difference: the academic circle benefits more from the digital age than laypersons. It may also be the result of institutional differences and information asymmetry.

The Golden Tax Project III and green innovation: evidence from heavily polluting enterprises in China

Using Golden Tax Project III in China as a quasi-natural experiment, we investigate the influence of tax enforcement on green innovation based on the panel data of China's heavily polluting enterprises from 2012 to 2020. Our baseline results show that the Golden Tax Project III negatively affects green innovation, and the impact still exists after a battery of robustness and endogeneity tests. Mechanism analyses reveal that increasing financial constraints contributes to less green innovation. Furthermore, heterogeneity analyses show that the negative relationship is more prominent in non-state-owned enterprises, enterprises with fewer analyst coverage, enterprises with lower institutional shareholding, non-high-tech enterprises, and enterprises located in eastern region. Our research reveals a previously under-explored adverse consequence of the Golden Tax Project III, its hindrance to green innovation. Some implications are put forward to mitigate the negative effect of Golden Tax Project III on corporate green innovation.

Analysis of a maritime transport chain with information asymmetry and disruption risk

Maritime transport chain is facing huge information asymmetry after the outbreak of major emergencies, such as COVID-19 epidemic. The previous literature has proved that information investing and information sharing are two effective tactics to relieve information asymmetry between supply chain nodes, and help them improve the performance of the supply chain. This paper assumes random demand disruption is the main cause of the information asymmetry in a maritime transportation chain. To explore how the random demand disruption and channel competition jointly impact operational decisions in a dual-channel maritime transport chain composed of one port, two carriers and shippers, we construct a game-theoretical basic model, and proposed two strategies, i.e., information investing and information sharing. Several significant managerial insights are derived. First, we find that inaccurate disruption information leads to inaccurate decisions and huge losses; Second, investing in precise information benefits the port only if the chain members are optimistic about the market, and improves the revenue of the carrier who invested in information if the investment cost is reasonable; Third, accepting information sharing benefits the port only when the precise disruption and the distortion of information are relatively large, as well as the misappropriate rate is relatively small; and only when the port is pessimistic about the market or the channel competition is weak, sharing information may hurt the carrier who invested in information. Finally, the strength of the channel competition will enhance the impact of information inaccuracy on the maritime transport chain.

Introduction to Special Issue: Topics Related to Real Estate Market Efficiency

The efficiency of the real estate market is a major concern for homeowners, investors, lenders, policymakers, and researchers. Modern academic literature has mostly moved beyond an early emphasis on formal tests of informational efficiency. The Grossman and Stiglitz (The American Economic Review 70:393-408, 1980) paradox holds that perfect informational efficiency is impossible and the joint hypothesis problem implies that market efficiency is not even testable. Instead, researchers now commonly examine the speed, accuracy, and persistence of price movements in response to new information, as the allocative efficiency of a market ultimately depends on its degree of informational (and operational) efficiency. This special issue is devoted to exploring these issues.

Retailer-driven carbon emission reduction: contract design in the presence of information asymmetry and cap-and-trade

This study considers a supply chain consisting of a dominant brand-name retailer and a manufacturer in the presence of a cap-and-trade mechanism and consumers' low-carbon preference. The retailer exerts advertising efforts, while lacks of the manufacturer's private carbon emission reduction effort cost information. We construct the benchmark model with information symmetry and asymmetry respectively. We obtain all members' equilibrium solutions and analytically examine the impact of the manufacturer's carbon emission reduction effort cost, the retailer's advertising effort cost, and consumers' low-carbon preference on the supply chain members' decisions. And then, we systematically compare two scenarios to obtain the condition in which the manufacturer would be willing to share the private information. With the aim of improving the manufacturer's carbon emission reduction effort level and all members' economic performance, we further propose a two-part tariff contract for information symmetry and asymmetry, respectively.

What (If Anything) is Wrong with High-Frequency Trading?

This essay examines three potential arguments against high-frequency trading and offers a qualified critique of the practice. In concrete terms, it examines a variant of high-frequency trading that is all about speed-low-latency trading-in light of moral issues surrounding arbitrage, information asymmetries, and systemic risk. The essay focuses on low-latency trading and the role of speed because it also aims to show that the commonly made assumption that speed in financial markets is morally neutral is wrong. For instance, speed is a necessary condition for low-latency trading's potential to cause harm in "flash crashes." On the other hand, it also plays a crucial role in a Lockean defense against low-latency trading being wasteful developed in this essay. Finally, this essay discusses the implications of these findings for related high-frequency trading techniques like futures arbitrage or latency arbitrage-as well as for an argument as to why quote stuffing is wrong. Overall, the qualifications offered in this essay act as a counterbalance to overblown claims about trading at high speeds being wrong.

Bank loan information and information asymmetry in the stock market: evidence from China

In this study, we use bank loan information to construct proxies for corporate transparency and examine whether these measures reflect information asymmetry in the stock market. Our analysis is based on a novel dataset of stock transactions and bank loans of all publicly listed firms on the Shenzhen Stock Exchange, covering January 2008 to June 2013. We find that firms with outstanding loans have a lower level of information asymmetry in the stock market, whereas firms with defaulted loans have a higher level of asymmetry. Further evidence demonstrates that the effect of loan default on information asymmetry in the stock market is more pronounced when these loans are borrowed from joint-equity commercial banks or multiple banks and when the default occurs under inactive market conditions. Our results remain robust to a series of endogeneity and sensitivity tests and provide suggestive evidence of a close connection between the credit loan and stock markets.

An implementation framework of blockchain-based hazardous waste transfer management system

The rapid increase in volume and types of hazardous waste (HW) due to China's continuous economic growth makes it significant to conduct HW safety management. However, due to the information asymmetry between the regulators and regulated institutions, problems such as illegal dumping and statistical fraud are common in hazardous waste transfer (HWT) activities. Moreover, there is a severe problem of information isolated island among waste production, transportation, and treatment companies in the HW market. Promoting the information monitoring and tracking of the whole process of HWT is the main challenge for HW management. Blockchain provides an ideal solution to overcome the above challenges. This study developed a framework for the blockchain-based HWT management system, which could support government regulators to obtain relevant information in HWT and improve the efficiency of HWT. The HWT management system was introduced in detail from different perspectives, including infrastructure, blockchain service, functions, and users, emphasizing six information management functions. Finally, the positive impact and various challenges encountered in implementing blockchain in HWT management were discussed. This study applies blockchain to the research field of HWT management, which expands the application of blockchain in the field of solid waste management with great theoretical and practical significance.

Evolutionary game analysis between employees and employers about working overtime from the perspective of information asymmetry

Background

Overtime is an international phenomenon, especially in some Chinese Internet technology companies, the 996 work regime is a common corporate atmosphere. This paper holds that overtime work is the result of a long-term dynamic game between employees and employers. In such a dynamic evolution process, employers and employees both cooperate and conflict, they will choose a strategy conducive to their own development through long-term learning and improvement.

Methods

Based on the evolutionary game theory and principal-agent theory, this paper constructs a \documentclass[12pt]{minimal} \usepackage{amsmath} \usepackage{wasysym} \usepackage{amsfonts} \usepackage{amssymb} \usepackage{amsbsy} \usepackage{mathrsfs} \usepackage{upgreek} \setlength{\oddsidemargin}{-69pt} \begin{document}$$2\times 2$$\end{document}2×2 evolutionary game matrix. The strategies of employees can be divided into voluntary overtime and involuntary overtime, while the strategies of employers can be divided into providing overtime pay and not providing overtime pay. The stability of the system is related to four parameters: resource consumption, information asymmetry coefficient, trust coefficient, and moral hazard coefficient.

Results

Through an in-depth study of the model and data simulation, the system has five equilibrium points, an ESS point, and a saddle point in any case. Accordingly, we put forward two theorems and three propositions, which are verified not only theoretically but also by data simulation. Besides, the strategies of the employees and the employers will evolve from the initial state to (Involuntarily, Not pay) or (Voluntarily, Pay) under different situations. This is closely related to the initial parameters of the evolutionary game model and the payment matrix.

Conclusions

By summarizing the influence of each parameter on the evolutionary path, we believe that fairness and information equivalence between employees and employers can effectively promote both parties to reach the Pareto optimal state. In other words, employees and employers need to communicate and share information promptly to ensure the unity of information acquired by each other and achieve a win–win situation. This paper contributes to providing theoretical guidance and practical enlightenment for organizations to manage employees' overtime behavior scientifically and improve their work psychology reasonably.

Promoting Less Complex and More Honest Price Negotiations in the Online Used Car Market with Authenticated Data

Online peer-to-peer (P2P) sales of used and or high-value goods are gaining more and more relevance today. However, since potential buyers cannot physically examine the product quality during online sales, information asymmetries and consequently uncertainty and mistrust that already exist in offline sales are exacerbated in online markets. Authenticated data platforms have been proposed to solve these problems by providing authenticated data about the negotiation object, integrating it into text-based channels secured by IT. Yet, we know little about the dynamics of online negotiations today and the impact of the introduction of authenticated data on online negotiation behaviors. We address this research gap based on two experimental studies along with the example of online used car trade. We analyze users' communicative and strategic actions in current P2P chat-based negotiations and examine how the introduction of authenticated data affects these behaviors using a conceptional model derived from literature. Our results show that authenticated data can promote less complex negotiation processes and more honest communication behavior between buyers and sellers. Further, the results indicate that chats with the availability of authenticated data can positively impact markets with information asymmetries. These insights provide valuable contributions for academics interested in the dynamics of online negotiations and the effects of authenticated data in text-based online negotiations. In addition, providers of trade platforms who aim to advance their P2P sales platforms benefit by achieving a competitive advantage and a higher number of customers.

The future of buyer-seller interactions: a conceptual framework and research agenda

The revolution in information availability and the advances in novel interaction technologies have ushered in two major shifts that call into question the traditional assumptions of buyer-seller interactions. First, buyer-seller information asymmetry has greatly decreased in many interactions. Second, face-to-face communication is no longer the main format of buyer-seller interactions. In this article, the authors review empirical research on how these shifts have changed buyer-seller negotiations, an important type of buyer-seller interactions. Several insights arise from this review. First, the shifts have caused fundamental changes in buyers' and sellers' roles, power, and aspirations and information processing. Second, the shifts and these fundamental changes together cause major changes in buyer-seller interactional processes and outcomes, including (1) change in buyers' attitude and behavior, (2) change in sellers' effectiveness in interacting with buyers, and (3) change in buyer-seller interactional processes. Based on these insights, the authors develop a research agenda to guide the reexamination of existing theories and the development of new theories of buyer-seller interactions.

Influence of contract commitment system in reducing information asymmetry, and prevention and control of livestock epidemics: Evidence from pig farmers in China

The prevention and control of infectious diseases in livestock is of great significance for maintaining the food and health of people. The main bottleneck in preventing and controlling the epidemic is asymmetrical information between farmers and the livestock department regarding dead livestock. In this pursuit, China has levied the contract commitment system to ensure farmers to cooperate with livestock departments, cooperative organizations, and other farmers by proper contract in order to combat the livestock epidemic by reporting the status of dead livestock on time. Based on the data of 514 pig farmers in Hebei, Henan, and Hubei, this research employed the Heckprobit model to explore the contract commitment system's effect on pig farmers' behavior in reporting the status of dead livestock. The outcome showed that the contract commitment system encouraged the farmers to report dead pig information promptly. Moreover, modern information channels such as mobile phones or the Internet further enhanced the contract commitment system's effectiveness. Besides, the impacts of the contract commitment system on different scale farmers are found substantially heterogeneous. Based on the empirical findings, it is confirmed that the contract commitment system should not exclude government regulatory measures and economic incentive policies. It is a useful remedy to encourage farmers to report dead livestock information on time and supports in preventing and controlling livestock epidemics. Additionally, the government should enhance and strengthen the contract commitment system, establish the channels and platforms required to deliver necessary information about epidemics, and implement differentiated policy programs for different scale farmers. More importantly, these countermeasures can also provide important guidelines for other developing countries, facing livestock epidemics.

Vertical value-added cost information sharing in a supply chain

We study a two-echelon supply chain with two homogeneous manufacturers and one common retailer who has full knowledge about his own value-added service cost structure that is unknown to the manufacturers. The retailer may choose to disclose his cost information to the manufacturers. Using a three-stage game-theoretic model, we derive optimal pricing strategies for each participant, and optimal information sharing strategies, and the optimal level of the value-added services for the retailer. Our study also reveals when the manufacturers should accept the disclosed information by the retailer. It is shown that information sharing does not always create a win-win situation among the partners in the supply chain. When the value-added service cost efficiency is low, the retailer is willing to share complete information with the manufacturers; however, information sharing harms the manufacturers' profits if they accept the shared information. In contrast, when the value-added service cost efficiency is high, the common retailer has no incentive to share information with the manufacturers and the unique equilibrium is no information sharing. Finally, we utilize a revenue-sharing contract to achieve supply chain coordination and induce information sharing under asymmetric information.

Rumor has it: How do patients respond to patient-generated physician ratings?

This paper studies the impact of patient-generated ratings of primary care physicians in Norway. Norway has a universal health care system, with no available objective quality indicators. In May 2012, an online review platform that allows patients to rate their physician was launched. Relying on a difference-in-differences approach we show that higher-rated physicians see an increase in demand relative to lower-rated physicians. The effect is primarily driven by females and patients with high socioeconomic status. We find no indications that physicians change their practice style or supply of patient capacity in response to the ratings.

Does voluntary integrated reporting reduce information asymmetry? Evidence from Europe and Asia

The purpose of this research is to examine the effect of voluntary integrated reporting on information asymmetry in European and Asian firms and investigate size as a moderator variable to this relationship. Using a final sample of 94 firms in Europe and Asia that published integrated reports in 2016, the Ordinary Least Square is then performed to analyze the data on quarterly basis. The quarterly analysis is used to look at the relevance of accounting information decline as the time lag increases. The results show that there is an insignificant relationship between integrated reporting quality and information asymmetry which is captured by spread. In addition, the insignificant effect of size to moderate this relationship is also found. These results are supported by additional analysis. This research contributes to the existing debate about whether integrated reporting affects the market, particularly information asymmetry. To the best of the authors' knowledge, this is the first study to examine the effect of integrated reporting quality on the market on a quarterly basis.

Foreign investors and stock price crash risk: Evidence from China

This study examines whether and how foreign investors affect firm-specific crash risk. Based on China's stock market, we show that foreign investors significantly increase stock price crash risk and the positive association is more pronounced in firms with high levels of information asymmetry or efficient internal control. We address endogeneity issue using a quasi-natural experiment, namely, the revision of Foreign Investment Industrial Guidance Catalog in 2011, and results still hold. Overall, this study provides policy implications on the effect of foreign investor in emerging capital markets.

Loss aversion and market crashes

This study proposes a rational expectation equilibrium model of stock market crashes with information asymmetry and loss averse speculators. We obtain a state-dependent linear optimal trading strategy, which makes the equilibrium price tractable. The model predicts nonlinear market depth and the result that small shocks to fundamentals (e.g., supply or informational shocks) can cause abrupt price movements. We demonstrate that short-sale constraints intensify asset price collapses relative to upward movements. The model also generates contagion between uncorrelated assets. These results are consistent with the main puzzling features observed during market crashes, namely abrupt and asymmetric price movements that are not driven by major news events but coupled with a spillover effect between unrelated markets.

The influence of the COVID-19 pandemic on asset-price discovery: Testing the case of Chinese informational asymmetry

The circumstances surrounding the outbreak of the COVID-19 pandemic have generated substantial international political strain as governments attempt to mitigate the widespread associated social and economic repercussions. One theory has focused on the potential for Chinese informational asymmetry. Using Chinese financial market data, we attempt to establish the scale and direction of information flows during multiple distinct phases of the development of the pandemic. Two specific results are identified. Firstly, the majority of domestically-traded Chinese stocks present evidence of significant information flows at a far earlier stage than internationally-traded comparatives, suggesting that domestic investors recognised the dangers associated with COVID-19 far in advance of the rest of the world. One potential explanation surrounds the view that the severity of domestically-reported Chinese news was not appropriately recognised by international investors. Secondly, while evidence of safe-haven and flight-to-safety behaviour is evident throughout traditional energy and precious metal markets, cryptocurrencies became informationally-synchronised with Chinese equity markets, indicating their use as an investor safe-haven. This is a particularly concerning outcome for international policy-maker and regulatory authorities due to the fragility of these developing markets.

Impact of fiscal decentralization on firm environmental performance: evidence from a county-level fiscal reform in China

To promote county economic prosperity and social development, China enacted a fiscal reform known as "province governing county" (PGC) in the early 2000s. Using the difference-in-differences (DID) method and a massive sample of enterprises from 2003 to 2011, this study investigates the effect of PGC reform on firm environmental performance. The results show that enterprises in reformed counties have significantly decreased their pollution intensity since the fiscal reform. Our research reveals that the environmental effects of fiscal decentralization are related to changes in the political assessment metrics of local officials. It also shows that PGC fiscal reform has a significant positive effect on the environmental performance of large, small, and micro enterprises. Furthermore, it suggests that PGC fiscal reform benefits the environmental performance due to the informational advantages of county governments. In terms of environmental governance, although local governments have an information advantage in the allocation of green fiscal funds, well-designed mechanisms are needed to strengthen their motivation.

White lie effects of information asymmetry on stock momentum

This paper aims to explore the relationship between information asymmetry and stock momentum. Using winner and loser approach, we find that winners with exaggerated forecast of earnings per share are more likely to have contrarian profits in subsequent holding periods. On the contrary, winners with low or middle-low information asymmetry tend to continue their good returns in future holding periods. In addition, the losers with middle information asymmetry achieve the highest contrarian profits, which may be called “white lie effects.”

Information Asymmetry and Host Country Institutions in Cross-Border Acquisitions

Mergers and acquisitions (M&As) are often dubbed as a market for lemons because of the extent of information asymmetry embedded in M&A transactions. A country's institutional environment influences the quality and overall reliability of formal disclosures, thereby altering the extent of information asymmetry affiliated with an M&A transaction. We argue that the caliber of the host country's institutions-formal market-supporting institutions and the informal cultural institution of uncertainty avoidance-affects the public arbitration phase of M&A transactions, i.e., the phase in which firms attempt to resolve issues related to information asymmetry. We test our hypotheses using a sample of 3376 foreign acquisitions completed by U.S. firms between 2006 and 2016. Our results indicate that formal institutions lower arbitration duration. But, while high uncertainty avoidance lowers duration as expected for countries with low market-supporting institutions, it more strongly raises the duration for countries with high market-supporting institutions.

Being Deceived: Information Asymmetry in Second-Order False Belief Tasks

We analyze four well-known second-order false belief tasks. Superficially, all four tasks share a common logical structure: All are based around a principle of inertia, which says that an agent's beliefs are preserved over time, unless the agent receives information to the contrary. However, a deeper analysis reveals details that are both suggestive and puzzling. First, the four tasks exemplify all four possibilities inherent in the two dimensions of being-deceived versus not-being-deceived and change-in-world versus change-in-belief-only. Second, there is a feature common to all four tasks: All come with a "built in" first-order false belief. We call these inner first-order false beliefs. They introduce an informational asymmetry that has the same logical form in all four tasks, but whose role is unclear. We do two things in this paper. First, we show that inner first-order false beliefs play an important (though seemingly unremarked) role in the experimental design of the tasks. Second, we present some empirical results (for both typically developing children and children with Autism Spectrum Disorder) on the effects of being-deceived versus not-being-deceived and change-in-world versus change-in-belief-only on second-order reasoning ability.

Supplemental health insurance in the Colombian managed care system: Adverse or advantageous selection?

The aim of this article is to estimate the type of selection that exists in the supplemental health insurance market in Colombia where compulsory coverage is implemented through managed care competition. We build a panel database that combines individuals' information from the Ministry of Health and a database provided by two private health insurers. We perform the correlation test for consumption of health services frequency and supplemental coverage. Following Fang et al. (2008), we condition the estimation on health controls that are available to the econometrician but not to insurers. In both cases we obtain a positive correlation, suggesting that adverse selection predominates. In order to rule out some moral hazard effects, we estimate the correlation between previous frequency of healthcare service consumption and supplemental insurance purchase. The positive correlation obtained is robust to the inclusion of controls for diagnosis implemented by health insurers, suggesting that despite some risk selection strategies, they are not protected from adverse selection. We conclude that some subsidies to supplemental coverage purchase would lower public expenditure in Colombia.

Old boys' network in general practitioners' referral behavior?

We analyzed the impact of social networks on general practitioners' (GPs) referral behavior based on administrative panel data from 2,684,273 referrals to specialists made between 1998 and 2007. For the definition of social networks, we used information on the doctors' place and time of study and their hospital work history. We found that GPs referred more patients to specialists within their personal networks and that patients referred within a social network had fewer follow-up consultations and less inpatient days thereafter. The effects on patient outcomes (e.g. waiting periods, days in hospital) of referrals within personal networks and affinity-based networks differed. Specifically, whereas empirical evidence showed a concentration on high-quality specialists for referrals within the personal network, suggesting that referrals within personal networks overcome information asymmetry with respect to specialists' abilities, the empirical evidence for affinity-based networks was different and less clear. Same-gender networks tended to refer patients to low-quality specialists.