The Impact of the Digital Economy on Financial Regulatory Costs: An Empirical Analysis Based on the Solow Growth Model

As a novel economic form,the digital economy is reshaping the financial regulatory landscape and significantly impacting regulatory costs.This paper incorporates the digital economy and financial regulatory costs into the classic Solow growth model,uncovering an inverted U-shaped relationship between them.A subsequent mechanism analysis explains the rationale behind this relationship.To empirically examine this relationship in China,the paper utilizes inter-provincial panel data from 2013 to 2021 and employs methodologies such as the two-way fixed effects and moderating effects models.These analyses have important implications for the sound and sustainable development of China’s financial industry.The findings indicate:(a)As China’s digital economy develops,its impact on financial regulatory costs follows an inverted U-shaped pattern,initially increasing and then declining.This conclusion remains valid after robustness tests.(b)The influence of the digital economy on regulatory costs depends on favorable external conditions.Specifically,the impact is more pronounced in regions and periods with better digital infrastructure and more abundant human capital.(c)Additionally,redundant resources moderate this impact,which can weaken the inverted U-shaped relationship.Our findings not only provide a theoretical foundation for understanding the impact of the digital economy on financial regulatory costs but also offer valuable policy insights for optimizing financial regulation in China.

An Empirical Study on Environmental Regulatory Costs &Environmental TFP

This paper examines the cost of environmental regulation and the environmental total factor productivity （TFP） with directional distance function and the Malmquist-Luenberger （ALL） index respectively, using inputs and output data of 36 two-digit industries over the period 1998- 2010. It finds that Chinese industries incur a relatively high environmental regulatory cost and that China has paid a high price fulfilling its promise to emissions mitigation. A comparison between conventional and environmental TFP shows that the two indicators for all industries declined on average, but a hypothesis test reveals insignificant difference between the two. In addition, the rise in environmental TFP is mainly due to technological progress, which is consistent with findings of many researches; analysis demonstrates signs of absolute convergence of environmental TFP.

The Impact of Incentives on the Number of Suppliers

In the context of adulteration by suppliers,downstream firms need to choose between incentives and regulation to ensure product quality.Studies have shown that the adulteration behavior of suppliers increases with the degree of dispersion of suppliers,that is,the number of suppliers increases.Therefore,based on the assumption that the number of suppliers impacts quality uncertainty,this paper further introduces the number of suppliers into the incentive model to investigate the relationship between supply chain dispersion,that is,the number of suppliers,social integrity,and incentive strength.The study finds that the optimal number of suppliers depends on social integrity,regulatory cost,and incentive strength.There is a positive correlation between social integrity and the number of suppliers,while regulatory costs and incentive strength have a negative correlation with the number of suppliers.That means,the higher the social integrity,the lower the regulatory cost;and the lower the incentive intensity,the more optimal suppliers can be selected.