Abstract：Coexistence of high investment and low consumption is a stylized fact in China‘s economic development. This paper studies the fiscal foundation of the fact above theoretically and empirically. Our theoretical findings are as follows.(1)Public spending in production has positive impact on the ratio of investment to consumption， while market congestion and market competition have the opposite effect.(2)Taxation on consumption will depress consumption as well as stimulate public spending in production，resulting in the increase in the ratio of investment to consumption.(3)There is a hump-shape or inverted-U relationship between overall tax rate or capital average tax rate and the ratio of investment to consumption. Our estimation results，which are quite robust，support the theoretical findings aforementioned. According to our findings，we suggest some policies like weakening the dependence of economic growth on public investment，increasing public spending in livelihood，and reinforcing direct tax in tax system by promoting reforms in property tax and private income tax.
Key Words: Investment；Household Consumption；Structure of Fiscal Spending；Structure of Taxation

Abstract：The virtualization tendency in Chinese economy has developed rapidly in recent years， but the virtual investments grow to excess should not be conducive to the actual production accumulation as well as to increase the risk of macroeconomic fluctuations. In this paper， we build a simple optimal investment decision-making model based on maximizing shareholders-interests，and conclude a dynamic Euler investment equation. Using the panel data during 1998—2012 which include two sets of listed companies in Shanghai and Shenzhen，we explore the problem about deviation of enterprise’s investment structure from the point of view on the tax system and liquidity constraints. We find that there exists the tendency that towards equity in firms-investment，tax incentives for equity investment significantly greater than fixed assets investment; Cash flow could increase the ability of enterprises-fixed investment，but there is no significant relationship between cash flow and private enterprises-equity investment. Our study also shows negative relationship between sales growth and investment which suggests that the acceleration theory cannot explain the realistic options for Chinese enterprises-investment.
Key Words：Tax Incentive; Cash Flow; Fixed Investments; Equity Investment; Euler Equations for Investments

Abstract：Using China urban household survey data collected from 41 cities in 2009，this paper examines the effect of health risk contained in self-assessed health status on Chinese urban household‘s consumption. Main findings are as follows：householder‘s selfassessed health status generally does not affect household’s consumption，also is true even for low-income households. But elder householder’s self-assessed health status is a major source of the household‘s health risk. The significant effect of health risk on consumption comes mainly from the self-assessed “poor” or “very poor” members or elderly ones other than the head of household. Household confronted with larger health risk will reduce per capita consumption，food consumption and non-food consumption. Household will adjust non-food consumption to partially insure food consumption from the effects of health risk. Health insurance can alleviate the negative effect of health risk on households consumption，especially for lowincome households. This study has rich policy implications.
Key Words：Precautionary Saving; Health Risk; Health Status; Health Insurance; Household Consumption

Abstract：China accelerated the construction pace of trade unions，as the country‘s income distribution is worsening and labor relation is intensifying. However，it is widely controversial on whether trade unions have improved labor rights. Given the aggregation bias and selection bias arose from the firm level cross-sectional data，this paper innovatively studies union’s heterogeneous effect on different type of workers using an employeeemployer dataset including about 24 million workers surveyed in 35 cities in 2009. After controlling the selection bias using treatment effects model，we have found that：(1)Chinese trade unions have not only significantly improved workers-wage rate，but also reduced their working hours;(2)The wage effect is primarily driven by medium-level skilled workers，whose wage rate increase is above the average; such wage effect is less significant among less-skilled workers. For both low-skilled and medium-skilled workers who have joined trade union，working hour is shorter than average.(3)Further analyses have shown that，the company ownership affects trade unionism largely：the state-owned enterprise workers benefit from trade union mainly on the wage rate; while private，HMT，and foreign invested enterprise workers benefit mainly from working hours.
Key Words：Trade Union; Heterogeneous Effect; Employee-employer Data; Income Gap

Abstract：This paper examines how the implementation of labor contract law affected the cost stickiness of labor for China‘s A-share listed firms in manufacturing industry from year 2004 to 2011，and how those firms responded by replacing labor with machinery equipment. Our results show that labor contract law has aggravated the cost stickiness of labor for all firms，particularly pay stickiness(in terms of price). This effect is more pronounced for those private enterprises，particularly employee stickiness(in terms of quantity). Furthermore，those firms are more likely to replace labor with machinery equipment after the implementation of this labor contract law; and this effect above is more pronounced for those private enterprises.
Key Words：Employment Protection Legislation; Cost Stickiness; Corporate Response

Abstract：In response to the financial crisis，many developed countries provided the telecommunications infrastructure stimulus plan to seize the opportunity of the next information revolution and improve the national competitiveness since 2008. Using the exogenous variables of telecommunications reform to overcome the endogeneity between telecommunication infrastructure and economic growth，we separately examined fixed and mobile telephony infrastructure on economic growth effect during the different industrial development period. We find that mobile phone and fixed phone infrastructure complementarily promote economic growth in the early build out period(1990—1999). Telecommunications industry has quickly entered into the more mature period since 2000. We find that mobile services contribute much more to growth but that the effect diminishes over time as the markets for these services become more mature. The fixed telephone infrastructure is significantly negatively correlated with economic growth，which shows that this infrastructure has been idle with the decrease of the fixed telephone subscribers. Our results have important policy implications for rethinking the investment strategy of telecommunications infrastructure.
Key Words： Infrastructure; Economic Growth; Telecommunications Industry; Economic Reform

Abstract：This paper incorporates a shadow banking sector，which plays an essential role in high risk credit market，in a DNK-DSGE framework. We argue that Chinese shadow banking system is just an extension of conventional commercial banking system，and study how such financial system affects the effectiveness of monetary policy transmission. We find that after a positive interest rate shock，commercial banking system is depressed and low risk firms reduce their leverage ratios. Nevertheless，shadow banks expand their credit to high risk firms under such contraction environment. After a negative interest rate shock，the opposite is just true. Although shadow banking system plays a complementary role in financial intermediaries sector，its countercyclical behavior means that it may weaken the effectiveness of monetary policy. In addition，risk appetites of shadow bankers and agency problem will affect shadow bank interest rate and other macro-variables significantly.
Key Words：Shadow Banking; Dynamic Stochastic General Equilibrium; Monetary Policy

Abstract：Based on samples in comparatively earlier periods，existing literature indicates a low efficiency with investment of state-owned enterprises(SOE)，which has been characterized as a typical fact given the long-term phenomenon of overinvestment in China. However，using the same measurement as before，this paper finds a puzzle that the investment efficiency of non-SOEs is significantly lower than SOEs in recent years. As an explanation，we propose the financial constraint hypothesis and show that the gap between investment efficiency of non-SOEs and SOEs is larger in industries with higher external financial dependence. Further，this gap becomes even larger when the monetary policy is tight and smaller when it is expansionary. The results demonstrate that the monetary policy shocks in recent years deteriorate the financial constraint problems facing non-SOEs. The SOEs get subsidy through financial system，crowding out the credit resources of non-SOEs，which lead to a sharp decline in investment efficiency of non-SOEs.
Key Words：Investment Efficiency; Ownership; Financial Constraint; Monetary Policy Shock

Abstract：Coordinated development of regional economy has been a theoretical and practical concern for long time. It is an important question about the capital space allocation and change by securities market and their effect on coordinated development of regional economy. This article establishes securities market spatial movement model(SMM Model)and describes the result by numerical simulation. SMM model indicates the securities market can aggravate the “Inverted U” curve of regional average income differences：in a short time，securities market facilitates capital to agglomerate to developed regions，which will increase the regional average income differences. But in a long time，securities market will decrease the regional average income differences. Meanwhile，the article proves the SMM model with SYS-GMM by the provincial data of securities market and other economic data from 1997 to 2011.This paper holds that，the government should respect the objective laws of securities market capital space allocation，expand and deepen the breadth and depth of capital markets，improve the freedom of capital movements by actively promote the development of capital markets. Also，the government should support the development of securities markets in central and western regions，improve the convenience of participation in the securities markets in central and western regions，promote coordinated regional economic development by enhancing the total capital markets amount and adjusting its spatial structure.
Key Words：Securities Market; Capital Space Allocation; Coordination of Regional Economy

Abstract：Mutual fund split is a way to decrease fund NAV and attribute to “one”，based on maintaining investors’ total asset invariant. Theoretically fund performance and investors interest change nothing during this process， but in fact fund split results to investor inflow largely and fund scale expanding promptly. Based on behavioral finance theory，we find that the investors-excess demand for splitting mutual fund comes from nominal price illusion for low NAV fund; The manager of mutual fund caters this irrational demand of price illusion through fund splitting to expand fund scale; Further result shows that after splitting，the quantity of investor increases largely， especially individual investors increase significantly. The average long-term return of split fund is lower significantly than the market return. In a word，fund split is a way that rational mangers cater investors-irrational preference to realize their own benefit. The implicit expropriation to investors coming from different degree of rationality exposed by this paper deserves the regulators-attention.
Key Words：Nominal Price Illusion; Catering; Mutual Fund Split; Degree of Rationality

Abstract：This paper introduces bank capital and financial frictions into an open DSGE model with export goods sector and non-traded goods sector. Then we see how international crisis affects exports goods sector，then transmits to exports goods sector through the net worth of bank. In our model，bank provides credit to both sectors，thus connects them closer. We calibrate the parameter of our model using the data of emerging economies including China. The impulse response of our model tells that when there are financial frictions，export demand shock in export goods sector transmits to non-traded goods sector more intense. And government can use credit policy to offset this disruption. Finally there is a welfare analysis.
Key Words：Financial Frictions; Net Worth of Bank; Exports Goods Sector; Non-traded Goods Sector

Abstract：ODI substitutes the export or complement? We use firm-level data to examine the relationship between ODI of Chinese firms and their export. The results of our examination present some evidences. Firstly，ODI of firms complete the export of firms. Secondly，the investment of business has the most export effect. Thirdly，if the host countries are rich，the effect of export is obvious. Forth，the effect of export is invert U. At last，ODI not only adds the intensive of export but also enlarges the extensive of export.
Key Words：Outward Direct Investment; Export; Mahalanobis Matching; Different-in-Different

Abstract：The paper explores the impact effects of different knowledge capital investment on the total factor productivity，technological progress and innovation efficiency of large and medium-sized industrial enterprises in China. Using total factor productivity model and 1997-2010 Chinese large and medium-sized industrial enterprises panel data，we analyze the differences of knowledge capital and innovative effect in different regions and industries .The results show that：the structure of knowledge capital investment of large and medium-sized industrial enterprises in China has changed obviously，the effect of technology development and technical transformation investment impact on industrial enterprises in total factor productivity is positive significant，but the role of absorption of foreign technology and imported technology on the technological innovation of industrial enterprises continues to weaken. The research results also show that：the knowledge capital investment among different regions in China has significant different impacts on total factors productivity. The innovation effect of knowledge capital of different technological levels of enterprise also exists obvious differences. This paper suggests that innovation driving strategy and policy should be based on regional and enterprise technological level difference，the implementation of different innovation driving strategy and policy will improve total factor productivity and innovation efficiency.
Key Words：Knowledge Capital; Technology Capital; Total Factors Productivity; Innovation Driving; Innovative Policy