Skip to the content.

Registration

If you are interested in receiving information about future workshops, please fill out the following survey form: here. Please feel free to share this information with anyone else who may be interested.

Workshop Schedule

Next workshop

Title Homemade Foreign Trading
Speaker Zhiguo He
Affiliation University of Chicago
Date&Time Jan 11th 2023, 9:00am-10:00am, GMT+8 /Jan 10th 2023, 5:00pm-6:00pm, PST/Jan 10th 2023, 8:00pm-9:00pm, EST
Abstract Using cross-border holding data from all custodians in China’s Stock Connect, we provide evidence that Chinese mainland insiders tend to evade the see-through surveillance by round-tripping via the Stock Connect program. After the regulatory reform of Northbound Investor Identification in 2018, the correlation between insider trading and northbound flows decays, so does the return predictability of northbound flows. The reduction of return predictability is especially pronounced among less prestigious foreign custodians and cross-operating mainland custodians, behind which mainland insiders are more likely to hide. Our analysis sheds light on the role of regulatory cooperation over capital market integration.

Past workshops

Speaker
Affiliation
Date
Title Abstract
Shelley Xin Li

University of Southern California

Dec 14th 2022
Structured Sharing of Best Practices on Unstructured Information Sharing Systems: Evidence from an Enterprise Social Network Unstructured information-sharing systems, such as enterprise social networks (ESNs), can supplement top-down knowledge transfer with peer-to-peer knowledge sharing. However, the large volume and uneven quality of peer-to-peer shared content can make it difficult to find relevant and trustworthy information. We examine data from a retailer that introduced structured sharing of best practices (SSBP), a mechanism to systematically highlight best practices from high-performing stores in the ESN it already used. This significantly increased the sales trends of the stores where it was implemented, consistent with gradual learning from SSBP. Improvement was greatest in stores that (a) perceived higher ESN information overload before the intervention, (b) had lower ex-ante offline exposure to best practices, or (c) were exposed to higher-quality posts during the intervention and was lowest in stores serving markets differing from those served by the best-practices stores. Our results also suggest positive externalities on knowledge sharing by non–best-practices stores.
Chicheng Ma

University of Hong Kong

Nov 23rd, 2022
The Legal Origins of Financial Development: Evidence from the Shanghai Concessions The critical challenge to assessing the legal origins view of comparative financial development is identifying exogenous changes in legal systems. We assemble new data on Shanghai’s British and French concessions between 1845 and 1936. Two regime changes altered British and French legal jurisdiction over their respective concessions. By examining the changing application of different legal traditions to adjacent neighborhoods within the same city and controlling for an array of military, economic, and political influences, we offer new evidence consistent with the legal origins view: the financial development advantage in the British concession widened after Western legal jurisdiction intensified and narrowed after it abated.
Yanbo Wang

University of Hong Kong

Oct. 12, 2022
Has China’s Young Thousand Talents Program been Successful in Recruiting and Nurturing Top Chinese Scientists? We study China’s Young Thousand Talents (YTT) Program and evaluate its effectiveness, or lack thereof, in recruiting elite expatriate scientists and in nurturing the returnee scientists’ productivity. We find that YTT scientists are generally of high caliber in research but, as a group, fall below the top category in pre-return productivity. We further find that YTT scientists are associated with a post-return publication gain across journal-quality tiers. However, this gain mainly takes place in last-authored publications and for high (albeit not top) caliber recruits and can be explained by YTT scientists’ access to larger funding and research teams. Our paper has policy implications regarding scientific talents’ global mobility, especially in the context that early-stage scientists have increasing challenges to access research funding in the US and EU.
David Yang

Harvard University

Sept. 21, 2022
Exporting the Surveillance State via Trade in AI What are the international ramifications of China’s emergent leadership in facial recognition AI? We collect global data on facial recognition AI trade deals and document two facts. First, we show that China has a comparative advantage in this technology. It is substantially more likely to export facial recognition AI than other countries, and particularly so as compared to other frontier technologies. This comparative advantage may stem in part from the Chinese government’s demand for the technology to support its surveillance state — a form of “home-market” effect — as well as Chinese firms’ access to large government datasets. Second, we find that autocracies and weak democracies are more likely to import facial recognition AI from China, in particular those lacking domestic AI innovation or experiencing political unrest. No such political bias is observed in AI imports from the US or in imports of other frontier technologies from China. To the extent that China may be exporting its surveillance state via trade in AI, this can enhance and beget more autocracies abroad. Regulations of AI trade should thus be framed around regulations on products with global externalities.
Yuan Zhang

University of Texas at Dallas

May 25, 2022
The Bright and Dark Side of a News Paywall We examine the implications of a news paywall for the capital market by exploiting the adoption of a digital subscription model by Caixin.com, a major financial media outlet in China as a quasi-experiment. Using a difference-in-difference research design, we find that news articles at Caixin.com have more original and detailed content and have higher associations with future earnings news after the paywall implementation than before, compared to control media outlets. However, news articles behind the paywall are associated with higher bid-ask spreads relative to other news articles. Further analyses show the paywall leads to a decrease in retail investors’ activities on social media, but an increase in forecast accuracy by analysts who are more likely to subscribe to Caixin.com. Overall, we provide novel evidence that a news paywall improves news quality but also contributes to an unlevel playing field for investors.
Eric Zheng

University of Texas at Dallas

Apr. 6, 2022
The Mercy of AI: Combating Natural Disasters through Lending Natural disasters wreak economic damage and cause financial distress to victims. However, when those in need of money apply for loans, lending firms often tighten up their lending practice as a reaction to victims’ impaired repayment ability. In this study, we show how lenders’ use of AI can help those who suffer from natural disasters. Collaborating with a leading credit scoring company in China that offers AI-as-a-Service (AIaaS) for lenders, we are able to observe lenders’ use of AI services in assessing the risk of loan applications. Through a Stochastic Frontier Analysis, we find that lenders who use AI services fare better in reducing the default rate of applicants suffering from natural disasters. Notably, such a default reduction effect is more pronounced for underprivileged borrowers with lower credit scores. We explore possible mechanisms under play and discuss the societal implications of our findings.
Yanhui Wu

University of Hong Kong

Mar. 30, 2022
Social Media and Government Responsiveness: Evidence from Vaccine Procurements in China This paper studies whether and how public opinion on social media affects local governments’ procurement of vaccines in China from 2014 to 2019. To identify causal effects, we exploit the regional variation in the eruption of social-media opinion on vaccine safety following sudden vaccination scandals. We find that governments in cities exposed to more intensive social media discussion increased the frequency and share of the more-transparent (open-bidding versus private arrangement) format of procurement for vaccine-related products. The effects are robust when we use early-stage social media penetration in China as an instrumental variable. Moreover, the effects are larger in cities where governments adopted more surveillance technology, the information environment was more strictly controlled, and local officials had stronger career concerns. Our overall findings shed light on the mechanisms and limitations regarding the effect of social media on policy compliance and government accountability.
Hong Ru

Nanyang Technological University

Feb. 23, 2022
Government Credit and Industrial Pollution Using firm-level pollution data from Environmental Survey and Reporting Database in China and loan data from the China Development Bank (CDB), we analyze how government-subsidized credit from the CDB affects firm pollution activities from a supply chain perspective. Consistent with prior studies, we find that while SOEs in China produce substantially more pollution (e.g., emissions of chemical oxygen demand (COD), sulfur dioxide (SO2), ammonia-nitrogen (NH3-N), wastewater discharge, and waste gas emission) than private firms, CDB credit helps reduce the pollution from SOEs much more than the reductions from private firms. Moreover, we find that CDB credit to strategic industries at the top of the supply chain is associated with lower pollution levels for firms in downstream industries. We further shed light on the mechanisms underlying such CDB credit positive spillovers across the supply chain through emission abatement actions and outcomes. First, we find that CDB loans induce SOEs to use substantially less water and coals in their production than private firms. In particular, one standard deviation increase in CDB direct loan (upstream loan) is associated with an additional 2.35% (4.79%) reduction in freshwater usage and 8.4% (3.48%) decrease in coal usage compared to private firms. Second, the results suggest that CDB loans enable SOEs to reduce COD pollution through better treatment of COD {COD treatment/(COD treatment+COD emission)} compared to private firms. Our findings suggest the important role of government credit in reducing pollution across the supply chain.
Bohui Zhang

The Chinese University of Hong Kong, Shenzhen

Jan. 12, 2022
Knowledge is Power: A Field Experiment in Chinese and US Stock Markets This study examines the causal impact of financial knowledge on stock pricing efficiency. We created an investor education website and conducted a field experiment by providing knowledge about the pricing implications of accounting accruals to investors in randomized stock groups via social media in both China and the US. We find that treatment stocks experience a reduction in accrual mispricing relative to control stocks, and that the effect is most pronounced when both conceptual and methodological knowledge about accruals is provided. The education effect is stronger among stocks with investors who are either less sophisticated or can study the knowledge more intensively. Finally, we document a real effect of financial knowledge on firms. Treatment firms experience a decline in discretionary accruals in the post-experiment period, especially when they are heavily owned by individual investors or less monitored by institutions.
Yue Zhang

Westlake University

Dec. 22, 2021
Recent progress and challenges in machine learning for Natural Language Processing (NLP) In recent years, artificial intelligence has received increasing attention. Deep learning technology has enabled intelligent systems to perform tasks that are far more complex compared to what machines could do a decade ago. Investigating automatic understanding and generation of natural language texts, natural language processing has been a central topic of artificial intelligence since its dawn, and human language dialogue capabilities has been recognised as a major metric for evaluating artificial intelligence. Advances in the field allow intelligent systems to perform automatic speech to speech translation, question answering, essay scoring, automatic auditing and algorithm trading by news reading.
The field of natural language processing has evolved since the early days of computer science, going through three main stages, where rule-based methods, statistical methods and deep learning methods dominate the literature, respectively. Researchers and engineers have seen a shift from linguistic feature engineering to parameter tuning in their daily work as the state-of-the-art approaches shift from statistical learning to deep learning. Today, deep learning not only allows natural language processing systems to perform much better on existing tasks such as syntactic parsing and automatic machine translation, but also enables new tasks to be investigated.
This talk aims to introduce the field of natural language processing from a machine learning perspective, laying out the mathematical and algorithmic foundations for the major technologies of this field. The organisation follows the order of increasing complexity, which is also largely consistent with the development history of NLP technologies. In particular, an overview of major NLP tasks is introduced first, and the remaining talk evolves around machine learning methods.
Kenneth Huang

National University of Singapore

Nov. 17, 2021
Trade Protection and Firm Innovation: Impact from U.S. Anti-Dumping Sanctions on Innovation Output in China This study examines how trade protections, such as anti-dumping sanctions on foreign exports, impact innovations developed by affected foreign firms. Using data on U.S. anti-dumping sanctions levied on Chinese exports from 1985 to 2015 and domestic patents developed by Chinese firms in China that are associated with the sanctioned products, we found that anti-dumping sanctions led to an increase in the overall number of domestic patents in China in technology classes that were most relevant to the sanctioned products. This result is consistent with our theory that anti-dumping sanctions enlarge the gap between the pre-innovation and post-innovation rents, thereby providing greater incentives for sanctioned firms to innovate. Furthermore, this effect was boosted by a major national-level pro-innovation campaign instituted by the Chinese central government to promote domestic innovations that further increased the post-innovation rent. However, we also found that anti-dumping sanctions decreased the production of novel patents in China that were most relevant to sanctioned products, which is consistent with the theory that anti-dumping duties reduce the resources available to firms to develop innovations. To sum up, these findings suggest that affected Chinese firms produce more innovations to escape competition and future sanctions, but that they can go only so far to produce more incremental innovations than novel innovations due to resource constraints. This study addresses the literature gap concerning how trade protections affect sanctioned firms’ innovation and generate important strategy and policy implications from such protections’ unintended consequences.
Yongxiang Wang

The Chinese University of Hong Kong, Shenzhen

Oct. 13, 2021
The Chinese Collectibles Bubble Using novel, hand-collected data from the largest Chinese collectibles exchange, we examine an asset price bubble in the collectibles market in the 2010s. Because the securitized collectibles were traded outside of the exchange, the fundamental price of the securities was publicly observable. This feature, combined with plausibly exogenous shocks to the cost of information acquisition, barriers to arbitrage, Tobin tax, and maturity allows us to further examine bubble theories in ways typically possible only in laboratory experiments. Our results are broadly consistent with resale-option theory, the importance of limited arbitrage, and provide support for the external validity of several key findings of the experimental bubble literature.
Clive Lennox

University of Southern California

Sept. 15, 2021
A review of China-related accounting research in the past 25 years The past 25 years have seen an exponential growth in the number of China studies in the leading accounting journals. The rise in China-related research mirrors the country’s increased importance on the global stage. We organize our review of the China literature around three central themes: 1) political and regulatory forces, 2) China’s relations with the outside world, and 3) the availability of novel data and regulatory shocks. The former two themes address research questions that are more China-centric, while the third exploits the China setting to examine questions that are less China specific. We highlight the contributions that China studies have made to the broader accounting literature, the limitations of the current literature, and we offer suggestions for future research directions.