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.

Effects of information asymmetry on cooperation in the prisoners' dilemma game

Effects of inforination asymmetry on cooperation in the prisoners＇ dilemma game are investigated. The amplitude A is introduced to describe the degree of information asymmetry. It is found that there exists an optimal value of amplitude Aopt at which the fraction of cooperation reaches its maximal value. The reason lies in that cooperators on the two-dimensional grid form large clusters at Aopt. In addition, the theoretical analysis in terms of the mean- field theory is used to understand this kind of phenomenon. It is confirmed that the information asymmetry plays an important role in the dynamics of the dilemma games of spatial prisoners.

Survey on Resistance Emotion of NCMS in Information Asymmetry and Countermeasures

Through survey on current situation of NCMS construction in Guangxi, we analyze deep reasons for farmers' resistance to NCMS. Major reasons include inadequate propaganda and training effort; narrow compensation scope influencing institutional functions; unreasonable reimbursement mechanism; low level of informatization management; imperfect supervision mechanism; and imperfect laws and regulations. In these situations, we put forward following countermeasures and suggestions: enhance training to ensure working efficiency; expand compensation scope to raise security level; adjust compensation standard to raise reimbursement proportion; lift level of informatization management to reduce costs for institutional operation; strengthen organizational construction to reinforce fund management; open up fund-raising channels to perfect legal system.

Cooperation Mechanism Design for Integrated Electricity‑Heat Systems with Information Asymmetry

Cooperation between electric power networks(EPNs)and district heating networks(DHNs)has been extensively studied under the assumption that all information exchanged is authentic.However,EPNs and DHNs belonging to different entities may result in marketing fraud.This paper proposes a cooperation mechanism for integrated electricity-heat systems(IEHSs)to overcome information asymmetry.First,a fraud detection method based on multiparametric programming with guaranteed feasibility reveals the authenticity of the information.Next,all honest entities are selected to form a coalition.Furthermore,to maintain operational independence and distribute benefits fairly,Benders decomposition is enhanced to calculate Shapley values in a distributed fashion.Finally,the cooperative surplus generated by the coalition is allocated according to the marginal contribution of each entity.Numerical results show that the proposed mechanism stimulates cooperation while achieving Pareto optimality under asymmetric information.

Empirical Study on Information Asymmetry Based on Chinese Forward Exchange Rate Market

Many published studies have considered information asymmetry between domestic and foreign investors about local assets in the stock market, particularly in developed markets. The present study proposes a new perspective to address the issue in the case of China ＂s forward exchange rate market. Following the framework of Clarida and Taylor （1997）, the term structures of exchange rates in the domestic forward and the non-deliverable forward markets are constructed and then applied to predict future spot exchange rates based on a vector equilibrium correction model By comparing the forecast accuracy on the basis of the root mean square error and the mean absolute error, it is shown that dynamic out-of- sample forecasts of the domestic forward market are superior to those of the non-deliverable forward market, suggesting that domestic investors are better informed than foreign investors. The result has several important policy implications, especially for exchange rate determination.

The impact of XBRL on information asymmetry:evidence from loan contracting

This paper examines whether and how the adoption of eXtensible Business Reporting Language(XBRL)reduces information asymmetry in loan contracting.We hypothesize that the adoption of XBRL can enhance information dissemination and mitigate the information asymmetry problem between borrowers and lenders.Using a sample of 554 US bank loan contracts,we find that borrowers who adopt XBRL enjoy more favourable price and nonprice terms of bank loan contracts.Additional analyses indicate that the relations among XBRL adoption and bank loan price vary with loan structure.Overall,this research provides evidence that technology advancements such as XBRL reduce cost of bank loans by decreasing information asymmetry between borrowers and lenders.

Strategic Contracting for Software Upgrade Outsourcing in Industry 4.0

The advent of Industry 4.0 has compelled businesses to adopt digital approaches that combine software toenhance production efficiency. In this rapidly evolving market, software development is an ongoing process thatmust be tailored to meet the dynamic needs of enterprises. However, internal research and development can beprohibitively expensive, driving many enterprises to outsource software development and upgrades to externalservice providers. This paper presents a software upgrade outsourcing model for enterprises and service providersthat accounts for the impact of market fluctuations on software adaptability. To mitigate the risk of adverseselection due to asymmetric information about the service provider’s cost and asymmetric information aboutthe enterprise’s revenues, we propose pay-per-time and revenue-sharing contracts in two distinct informationasymmetry scenarios. These two contracts specify the time and transfer payments for software upgrades. Througha comparative analysis of the optimal solutions under the two contracts and centralized decision-making withfull-information, we examine the characteristics of the solutions under two information asymmetry scenarios andanalyze the incentive effects of the two contracts on the various stakeholders. Overall, our study offers valuableinsights for firms seeking to optimize their outsourcing strategies and maximize their returns on investment insoftware upgrades.

A blockchain and IoT-based lightweight framework for enabling information transparency in supply chain finance

Supply Chain Finance(SCF)refers to the financial service in which banks rely on core enterprises to manage the capital flow and logistics of upstream and downstream enterprises.SCF adopts a self-testing and closed-loop credit model to control funds and risks.The key factor in a successful SCF service is the deployment of SCF businessoriented information systems that allow businesses to form partnerships efficiently and expedite cash flows throughout the supply chain.Blockchain Technology(BCT),featuring decentralization,tamper-proofing,traceability,which is usually paired with the Internet of Things(IoT)in real-world contexts,has been widely adopted in the field of finance and is perfectly positioned to facilitate innovative collaborations among participants in supply chain networks.In this paper,we propose a BCT and IoT-based information management framework(named BC4Regu),which works as the regulatory to improve the information transparency in the business process of SCF.With BC4Regu,the operation cost of the whole supply chain can be significantly reduced through the coordination and integration of capital flow,information flow,logistics and trade flow in the supply chain.The contributions in this paper include:(1)proposing a novel information management framework which leverages Blockchain and IoT to solve the problem of information asymmetry in the trade of SCF;(2)proposing the technical design of BC4Regu,including the Blockchain infrastructure,distributed ledger-based integrated data flow service,and reshaped SCF process;and(3)applying BC4Regu to a group of scenarios and conducting theoretical analysis by introducing the principal-agent model to validate the BC4Regu.

The Impact of Cost Information Sharing on Procurement Contract Design

In this paper,we provides contract design mechanisms and analysis for manufacturers to manage decentralized supply chain.Suppose the manufacturer’s final product consists of components,each produced by a different supplier,and the manufacturer first purchases components from suppliers,then assembles them into final product and meet demands aftermarket realization.While supply chain’s internal cooperation always benefits both,suppliers are often reluctant to proactively share their own production cost structure,otherwise manufacturers may depress purchase prices,which may reduce supplier’s profit.Manufacturers on the other hand,prefers to be informed of true cost information in order to gain greater revenues.We takes manufacturer’s perspective and design the optimal contract menu for suppliers,both to enable suppliers to disclose private cost information and to maximize the benefits.We start by modeling the original problem and find that the original problem is a complex multidimensional optimization problem.We then examine the nature of the original problem solving and devise the solution algorithm to arrive at the optimal contract menu.This algorithm reduces the complexity of the original question from o(2 n)to o(n).We further investigate the influence mechanism of model parameters on the results and find that when market demand increases or the selling price of the final product increases,value of private information increases significantly.However,if market demand uncertainty increases,the value of information may increase or decrease for both sides.

Behavior characteristics and market operation problems of existing building energy-saving renovation market

The long-term and effective implementation of the existing building energy efficiency renovation depends on the development of the existing building energy efficiency renovation market.The key to the development of the existing building energy efficiency renovation market is the joint role of the market players.Starting with the analysis of the externalities and information asymmetry of the existing building energy efficiency renovation market,this paper analyzes the behavioral characteristics and influencing factors of the existing building energy efficiency renovation market entities(central government,local government,owners,energy conservation service enterprises,third-party evaluation institutions,and other market entities),and reveals the problems of the existing building energy efficiency renovation market,such as the absence of government,the lack of main power,and the lack of financing channels,Thus,it lays a platform foundation for the research on the behavior strategy and security system of the existing building energy-s aving renovation market.

Bargaining strategy of oil companies in international oil and gas development Projects-Based on a bilateral bargaining model

Bargaining between the host country and oil companies is very common to international oil and gas development projects.The existence of information asymmetry gives the host country an endogenous bargaining advantage.Foreign oil companies might change their unfavorable negotiating position by changing the order of bidding and adjusting bidding strategies.This paper introduces both factors into a bilateral bargaining model to study the impact of information asymmetry and bidding order on the strategy and equilibrium returns of oil companies.According to the ownership of the right to bid first,two scenarios are designed for the model to compare the equilibrium returns of the host country and oil companies.The results show that:1)There is a first-mover advantage in the process of bilateral bidding,so oil companies better bid first;2)The information asymmetry will lead to a higher nominal income ratio of oil companies and a lower nominal income ratio of the host country,but it doesn’t affect the total income ratio at all.

A Study on‘the Market for Lemons’and the Strategy of‘Unification’in Booking Systems:A Case Study on the FAHSYSU Simulation T System of the Training Center for Clinical Skills of the First Affiliated Hospital of Sun Yat-sen University

Based on the blueprint of the training center for clinical skills of our hospital,this paper discusses the effect of‘the market for lemons’in its booking system from the perspective of economics of information,uses the law of large numbers and the central limit theorem to model to carry out the case study of FAHSYSU Simulation T,and takes measures of offsetting adverse selections to increase booking efficiency.The paper also analyzes how to apply the ancient Chinese theory that man is an integral part of nature to wipe out‘the market for lemons’.

Digital Transformation, Information Search, and Women's High-Quality Employment

The promotion of fuller and higher-quality employment is a prime task for China's high-quality development.Both employment security(ES)and employment quality(EQ)need to be improved for women who,as an essential part of labor force,have long been faced with high stress and employment threshold.The role of digital transformation in promoting women's employment through reducing the cost of job information search is analyzed with the Job Search Theory in this paper.By using China Household Finance Survey(CHFS)data,this research found that digital transformation of households in China contributes to women's employment significantly,raises the number and proportion of female family members in employment,and enhances women'access to medical care insurance,endowment insurance,unemployment insurance,housing fund and overtime pay.Digital transformation can improve the information accessibility of households,and the reduction in information asymmetries benefits women's employment,as indicated by the mechanism analysis.The positive impact of digital transformation is more pronounced for households in Central China,Western China and provinces with high unemployment rates,as well as those supporting the elderly and without housing.This paper will serve as a reference to fuel high-quality employment and reduce dificulties for women in the context of digital transformation.

Analysis of stage-investing strategy in equity financing market

Stage-investing strategy is a primary measure to mitigate asymmetric information during equity investment. This paper attempts to investigate the problem faced by equity investors wishing to make optimal investment decision under stage-investing strategy. A serial investment-decision making model will be designed to help investors to take the best choice.

The impact of reporting frequency on the information quality of share price： evidence from Chinese state-owned enterprises

As a major global exchange, the Stock Exchange of Hong Kong （SEHK） only requires semi-annual reporting whereas other major exchanges including the ones in Chinese mainland require quarterly reporting. We argue against the traditional view that higher reporting frequency is necessarily more beneficial. The decision on reporting frequency depends on how the information is being processed by the recipient traders and the results are not obvious. Using a sample of Chinese companies dual- listed in both China A share market and SEHK （AH shares） as the experimental group and mainland＇s companies listed on SEHK （H shares） only as the control group, we apply the difference-in-difference （DID） method to investigate the impacts of reporting frequency on stock information quality. The results suggest that after China A share market require quarterly financial reporting for all listed companies in 2002, the information asymmetry of the H tranche of AH stocks increases. Different from prior studies, the results suggest a negative association between stock information quality and financial reporting frequency. We argue that the increased information asymmetry in the H tranche is caused by the noise spilled over from the A tranche. We conduct multivariable GARCH tests and find evidence supporting this conjecture.

Accruals quality,underwriter reputation,and corporate bond underpricing:Evidence from China

This study examines the relationship between accruals quality and the underpricing of corporate bonds in China and how underwriter reputation affects this relationship.We?nd that(1)accruals quality is negatively associated with the magnitude of bond underpricing and(2)the impact of low accruals quality on underpricing is partially offset by hiring reputable underwriters.A path analysis shows that approximately 11% of the effect of accruals quality on underpricing is attributable to the indirect path through reputable underwriters,suggesting that accruals quality is more effective than reputable underwriters in lowering bond underpricing.These?ndings are signi?cant for initial bond offerings,but not for secondary bond offerings.We also?nd that low accruals quality is associated with more restrictive non-price contract terms such as greater collateral requirements and stricter covenants.

Can returnee managers promote CSR performance？ Evidence from China

With growing economic globalization, returnee managers who have obtained education or work experience overseas play a much more crucial role in corporations, especially in emerging economies. Using hand-collected managerial background data from a sample of firms listed on the Shanghai and Shenzhen Stock Exchanges from 2010 to 2014, this paper investigates the impact of returnee managers on corporate social responsibility （CSR） performance. We find that returnee managers can promote CSR performance. Further analyses show that the impact of returnee managers on CSR is more pronounced when managers have a foreign study background compared to managers with foreign work experience. The impact only holds when managers obtained their experience in developed economies. When enterprises face greater information asymmetry, returnee managers are more willing to use CSR as a tool to convey a positive image to stakeholders. CSR can help managers reduce information asymmetry and improve firm value. The results are robust through a series of robustness checks including a propensity score matching （PSM） procedure and a Heckman two-state sample selection model. This paper contributes to growing studies on the economic consequences of returnee managers and advances our understanding of the determinants of CSR at the individual level. The results also have implications for government and enterprises attracting talents with overseas experience.

The capital market spillover effect of product market advertising:Evidence from stock price synchronicity

We analyze whether product market advertising has a spillover effect on stock price synchronicity by transmitting firm-specific information to the capital market and attracting more investor attention.Using a sample of Chinese listed firms from 2009 to 2017,we find that firms with greater advertising expenditures have lower stock price synchronicity.The results are robust after we address endogeneity concerns.In accord with our hypothesis that product market advertising increases the amount of firm-level information capitalized into stock prices through the information channel,we find that the impact of advertising on synchronicity is more pronounced for firms with a higher degree of information asymmetry and firms in the consumer-product industry.Further tests show that product market advertising enhances the ability of current period returns to reflect future earnings,and thus rules out that the negative relationship between advertising and synchronicity is driven by noise trading.Our results imply that product market advertising plays an informative role and improves information efficiency in a capital market.

OPTIMAL AND INCENTIVE COMPATIBLE PRICING FOR HETEROGENEOUS PERIODS

This paper studies a service firm whose business time can be divided into several periods, each providing different value to customers. Heterogeneous service is a major reason resulting in imbalances between supply and demand. Since customers differ in their degree of impatience, firrns can use differential pricing mechanisms to optimize their objectives and match supply with demand in each period, by inducing customers to choose different periods. We study two types of firrns, an internal firm, the objective of which is to maximize the system＇s （including the f＇nan and all the customers） total net value, and a commercial firm, which aims to optimize its own profit. Though impatience factors are customers＇ private information, for each type of firm, we derive the optimal incentive compatible pricing policy, under which all the coming customers will follow the firm＇s assignment, that is, patient customers will buy the service in high-value periods, but their waiting time will be longer, while impatient customers will enter into the low-value periods, but they will be compensated by shorter waiting times. Furthermore, in the internal firm, we also prove that this mechanism enables the decentralization of decisions, while maintaining centralized system-wide optimality. Numerical analysis shows that when there is sufficient capacity, the internal firm does not always need to set lower prices than the commercial firm in every period.

The pricing and performance of IPOs in China's poor counties

In the context of China’s drive to alleviate poverty,we focus on the initial public offering(IPO)firms located in China’s poor counties and investigate their IPO pricing and post-IPO performance.Contrary to the findings reported for the U.S.,we find that the problem of information asymmetry between Chinese firms located in rural areas and their investors is so severe that these IPO firms are associated with significantly higher underpricing.This effect is more pronounced for firms located in rural areas with poor traffic systems.We do not find significant market performance differences between rural and urban firms after their IPOs,but the operating performance of rural firms improves in the short term.Our additional analyses indicate that rural IPO firms have significantly lower investor attention and higher agency costs than urban firms.Overall,we enrich the literature on IPO pricing and the economic effects of geographic location.