Journal of China Economics

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SU Shibin CAI Limin

2025, 1(13): 1-25.

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In order to further promote the development of new quality productive forces

tailored to local conditions, based on the shortcomings of existing research and the logical

relationship diagram of new quality productivity, a new quality productivity evaluation index

system was constructed. The core elements of the three-level index system of new quality

productivity were determined by integrating the SRCFS model and simulated annealing

algorithm to optimize the projection pursuit model. The evaluation and prediction of new

quality productivity in China during the two periods of 2019-2023 and 2025-2035 were

evaluated and predicted using the combination of minimum deviation method and grey

metabolism prediction model. At the same time, the self-organizing mapping neural network

clustering method was used to classify and analyze the characteristics of new quality

productivity in the above two periods. Studies have found that, as a whole, the level of new

productivity in my country has shown a year-on-year growth trend in the short-term and

medium-term development process, but there are still regional differences; under the short

term development, the new quality productivity of various provinces and cities in my country

can be divided into developed and medium developments. And the three levels of

underdeveloped development, most of them have not reached the level of development; with

the development of medium and long term, the new productivity of new quality in various

provinces and cities in my country will show a relatively significant improvement, except for a

few provinces and cities, it has basically reached the level of medium developed and above.

Therefore, in the process of cultivating and developing new productive forces in my country,

China must not only make overall layout, but also cooperate with local conditions.

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Employment Effects of Robots: An Analysis Based on

Heterogeneity-Robust Estimator

ZHAO Man

2025, 1(13): 26-58.

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Employment is the foundation of people’s livelihood. The report of the Party’s

20th National Congress proposed to “strengthen the employment priority policy, improve the

employment promotion mechanism, and promote high-quality full employment.” In the new

stage of China’s high-quality development, how to better benefit the dividend of scientific and

technological innovation to the labor market is an important measure to achieve high-quality

full employment. According to the International Federation of Robotics (IFR), with the rapid

development of artificial intelligence technology represented by robots, China has become the

world’s largest country in the installation of robots, and surpassed the total installation of other

regions for the first time in 2021. The large-scale use of robots has had a profound impact on

China’s labor market, and the employment “creation effect” and “destruction effect” of robot

application have a direct impact on the labor market. Then, will the application of artificial

intelligence technology represented by robots lead to unemployment?

In order to answer the above questions, based on the data of Chinese industrial enterprises and

import and export data of China Customs, this paper uses PSM-DID estimation method to

study the impact of robot application on the job market from the enterprise level. The

benchmark results show that the application of robots in enterprises is a “positive choice”, and

the application of robots significantly promotes the employment demand of enterprises, and

the employment increase of enterprises after the application of robots is about 28.85%.

Mechanism analysis finds that the application of robots mainly promotes enterprises to

increase employment by improving enterprise productivity and increasing output. Further

research shows that compared with labor-intensive and eastern enterprises, robot application

has a stronger role in promoting employment in non-labor-intensive and central and western

enterprises. In addition, this paper also finds that there is no “crowding out effect” in robot

application, and robot application does not significantly reduce the employment of non-robot

application enterprises in the industry. The conclusion of this paper provides some empirical

evidence for the effective use of technological innovation to promote the realization of more

adequate and higher quality employment in the new development stage.

Based on the research findings, this paper draws the following policy implications. First,

improve supporting facilities and encourage enterprises to apply robots. Relevant government

departments should formulate industrial policies to promote the development of robotics

technology and actively guide enterprises to apply robots in order to promote the realization of

high-quality full employment. For example, reduce the income tax of enterprises to purchase

robots, and reduce the initial investment cost of enterprises to introduce robot technology, so as

to encourage enterprises to apply robots. In addition, further improve the infrastructure for the

development of the robot industry, and increase financial support for the industry, such as

setting up a special fund for robot research and development, establishing a robot industrial

park, attracting science and technology groups to settle in and carry out robot research and

development, production and sales, and enriching the types of robot products to better match

the production links of enterprises. Thus, the employment effect of robot application can be

more effectively brought into play. Second, adapt to local conditions and implement policies

for enterprises to deepen the application level of robots. Relevant government departments

should adapt to local conditions and implement policies for enterprises to actively guide

enterprises to further improve the application level of robots. Effectively exert the dividends of

the development of artificial intelligence technology, and constantly stimulate the employment

effect of robot application while promoting the development of enterprises. Third, build a

training system and strengthen the skills training of workers. The relevant government

departments should increase the skills training of the labor force, especially the low-skilled

labor force, to help them adapt to the job changes brought by the application of robots. For

example, enterprises are encouraged to cooperate with universities to establish robot

experiment bases, set up training courses for robot engineers, robot operators and other

professions, and train professional and technical talents to help the labor force transition from

traditional positions to new technical positions.

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Patience is a Virtue: Patient Capital and the Financialization

of Real Economy Enterprises

QIU Rong TIAN Zihao DING Rui

2025, 1(13): 59-80.

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Patient capital, as an emerging concept, plays a critical role in addressing the

challenges posed by the financialization of real economy enterprises. Unlike traditional short

term investment models, patient capital emphasizes long-term financial support, reducing

firms' reliance on frequent financial market operations to achieve short-term profitability. This

innovative mechanism enables enterprises to allocate resources toward core business

development and innovation, effectively mitigating the risks associated with excessive

financialization. By fostering stability and growth, patient capital contributes to a healthier

economic ecosystem while aligning with broader objectives of sustainability and corporate

responsibility. In view of this, this paper investigates the mechanisms through which patient

capital reduces uncertainty perception and risk-taking levels, aiming to provide a new

perspective on restraining enterprise financialization.

Theoretically, this paper elaborates on the logical foundation of patient capital in curbing

financialization. Patient capital, characterized by its emphasis on long-term orientation, strong

risk resilience, and strategic relationship-building, offers enterprises a pathway to financial

stability. By ensuring stable and predictable funding sources, patient capital reduces the

dependency of firms on short-term financial operations that prioritize quick returns. This shift

in focus allows enterprises to reallocate resources toward areas that promote sustainable

growth, including core business activities and innovation-driven projects. Furthermore, patient

capital investors prioritize long-term value creation over short-term profit maximization,

fostering trust-based and cooperative relationships with enterprises. These relationships not

only reduce uncertainty perception and risk-taking levels but also optimize the allocation of

capital, thereby mitigating the adverse effects of financialization on the real economy. This

theoretical framework establishes a solid foundation for understanding the mechanisms

through which patient capital can transform enterprise financial strategies.

Empirically, this study uses data from Chinese listed companies between 2009 and 2022 to

examine the effects of patient capital on enterprise financialization. The findings confirm that

patient capital significantly restrains financialization, with the results remaining robust after

multiple robustness checks and endogeneity discussions. Specifically, patient capital reduces

financialization by lowering uncertainty perception and risk-taking levels among enterprises.

By providing stable financial support, patient capital minimizes firms' reliance on short-term

profit generation, enabling them to withstand market fluctuations and economic pressures.

Moreover, the long-term nature of patient capital facilitates better alignment with firms'

strategic goals, encouraging sustained investment in productive and innovative activities.

These findings highlight patient capital's critical role in stabilizing corporate financial behavior

and promoting high-quality economic development.

Further analysis reveals the heterogeneous effects of patient capital on financialization. When

financialization is divided into moderate and excessive levels, the results show that patient

capital exerts a stronger restraining effect on excessive financialization. Excessive

financialization, characterized by over-investment in financial assets at the expense of

productive investment, can lead to the formation of asset bubbles and heightened financial

instability. Patient capital mitigates these risks by encouraging enterprises to prioritize long

term investments over speculative financial activities. This effect is particularly significant in

reducing the adverse consequences of excessive financialization, including the erosion of

productive capacity and increased systemic risk.

Additionally, this paper identifies the role of patient capital in stabilizing firms’ earnings

volatility. Financialization, while offering short-term financial gains, often increases

operational risk and revenue instability. Patient capital counters these effects by providing a

stable financial foundation, reducing firms’ susceptibility to market fluctuations and enabling

them to maintain consistent profitability. This stabilizing effect underscores the inherent trade

offs in financialization: excessive pursuit of short-term returns can result in high volatility and

increased risk exposure, whereas a focus on long-term growth and prudent investment fosters

sustainable economic benefits. The findings emphasize that patient capital plays a vital role in

addressing the “more haste, less speed” dilemma, where short-term financial pursuits hinder

long-term enterprise success.

This study makes several important contributions to the literature on financialization and

corporate governance. First, it provides a theoretical framework for understanding how patient

capital influences enterprise financialization through its unique emphasis on long-term stability

and risk mitigation. Second, it offers empirical evidence on the mechanisms through which

patient capital reduces uncertainty and risk-taking, contributing to the broader understanding

of financial stability in the real economy. Third, it demonstrates the significant policy

implications of patient capital for fostering sustainable economic growth and preventing

excessive financialization.

This research also offers actionable insights for policymakers and practitioners. Promoting the

growth of patient capital should be prioritized to support long-term economic stability and

high-quality development in China's real economy. Furthermore, enhancing the coordination

between primary and secondary financial markets can strengthen the foundational support for

patient capital. Finally, targeted measures are needed to manage financialization, with a

particular focus on preventing excessive financialization among enterprises. By leveraging the

unique benefits of patient capital, policymakers can create a more resilient and sustainable

economic system.

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The Gap between Words and Deeds in Digital Transformation

and Stock Price Crash Risk

ZUO Xiangtai

2025, 1(13): 81-105.

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Digital transformation is a strategic change process that triggers significant

changes in the attributes of an enterprise entity through a combination of information,

computing, communication, and connectivity technologies. This process thereby improves the

enterprise entity and enhances its comprehensive competitive advantages. By utilizing relevant

digital technologies, it can effectively promote the digital transformation of enterprises and

industries. In the specific application process: on the one hand, it aims to accelerate the digital

transformation and upgrading of enterprises and comprehensively deepen the digital

transformation of key industries; on the other hand, it seeks to promote the digital

transformation of industrial parks and industrial clusters, and to cultivate a transformation

support service ecosystem. In terms of its breadth of influence, digital transformation can not

only promote the high-quality development of the macro economy, but also impact the capital

market performance of micro enterprises.

However, there is a discrepancy between the words and actions of some companies regarding

digital transformation. That is, they claim to have a rich digital transformation strategy, but

their actual investment is relatively meager. This discrepancy exacerbates the risk of share

price collapse and affects the stability of the capital market, which in turn further impacts the

actual benefits of enterprises. In this paper, we select a sample of listed companies in China’s

Shanghai and Shenzhen A-shares from 2010 to 2021 to empirically analyze the specific impact

of digital transformation with inconsistent words and deeds of enterprises on the risk of stock

price collapse, and to explore the possible causes of such inconsistency. It is found that digital

transformation with inconsistent rhetoric and behavior leads to a significant increase in the risk

of share price collapse faced by firms, and this finding remains robust after a series of

robustness tests. In a further study, a deeper investigation into the causes of digital

transformation misalignment reveals that firms’ perceptions of economic policy uncertainty

significantly widen the gap between firms’ digital transformation “words” and “deeds”, with a

more pronounced effect in the sample of loss-making firms. Meanwhile, the heterogeneity test

shows that investors are more tolerant of SOEs’ digital transformation behaviors that are

inconsistent with their rhetoric.

These findings, on the one hand, provide an interpretable explanation for the disparity findings

in previous studies, and on the other hand, offer new ideas for enhancing the stability of the

capital market and realizing the high-quality development of the economy. From a policy

perspective, attention should be paid to the impact of economic policy uncertainty on the

digital transformation of enterprises, and efforts should be made to actively reduce such

uncertainty in order to promote a more “real” digital transformation. In addition, enterprises

should focus on consistency between words and deeds, enhance transparency, and adhere to

“real” digital transformation actions in order to reduce the risk of stock price collapse,

establish a good corporate image, and attract more investment. Overall, the research in this

paper provides useful insights for understanding the relationship between corporate digital

transformation words and actions and stock price crash risk, as well as new insights for the

stability of the capital market and the advancement of high-quality development of China’s

economy.

In response to the phenomenon of inconsistency in corporate digital transformation, this paper

argues that the government should consider and formulate policies to regulate corporate

behavior, as this phenomenon may pose a potential threat to the stability of the capital market

and the interests of investors. By discussing the inconsistencies in the digital transformation of

enterprises, we can accurately identify whether the enterprises have actually fulfilled their

promises of digital transformation in the future, or whether they have only remained at the

level of false propaganda. Then, reasonable thresholds can be set to effectively limit the

excessive propaganda behavior of enterprises in digital transformation, thereby better

protecting the interests of investors at the source and building a solid foundation for the long

term and stable development of the capital market. On the other hand, the relevant regulatory

authorities need to conduct a comprehensive and systematic assessment of enterprises whose

words and deeds are inconsistent. Based on the assessment results, severe penalties should be

imposed on enterprises whose words exceed their deeds, forming a strong deterrent. At the

same time, timely and effective encouragement and support should be given to enterprises

whose deeds exceed their words, stimulating their motivation and creativity.

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Does Industry Information Disclosure Affect Corporate

Financialization? Empirical Evidence from Industry

Information Disclosure Guidelines

HUANG Bingyi ZHANG Tianyi

2025, 1(13): 106-128.

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Information disclosure is a key factor influencing the effectiveness of capital

markets. Perfecting the information disclosure system of listed companies and deepening

capital market reforms are hot issues of concern for regulatory authorities and academia.

Financial information is increasingly unable to meet the increasingly diverse information needs

of investors. Operational information disclosure such as management discussions and analyses

has gradually become a focus of attention for investors and academia. However, there has been

little research on the economic consequences of industry-specific operational information

disclosure. In recent years, the yields of financial products and real estate investments have

remained high for many years, and the number of entities engaged in financial product

investments has continued to increase. The trend of entities becoming more financially

oriented is becoming increasingly evident, and the problem of “moving away from the real

economy towards the virtual economy” is becoming more serious. Against this background,

this article takes industry-specific operational information disclosure as a starting point to

explore the impact and economic consequences of industry information disclosure on

corporate financialization.

This article takes companies listed on the Shanghai Stock Exchange as the research sample and

constructs a multi-timepoint difference-in-differences regression model using the successive

releases of the “Industry Information Disclosure Guidelines” between 2015 and 2021 to

examine the impact of industry information disclosure on corporate financialization. Empirical

tests reveal a significant negative correlation between industry information disclosure and

corporate financialization, indicating that industry information disclosure can restrain

corporate financialization behavior. The above findings remain robust after conducting placebo

tests, PSM+DID tests, and other robustness tests. In further research, this article conducts

heterogeneity analyses of market competition, and management experience. It is found that

industry information disclosure has a stronger inhibitory effect on corporate financialization in

companies in low market competition, and less management experience. In the mechanism

test, this paper finds that industry information disclosure inhibits corporate financialization

through the learning imitation effect of information spillover and the governance effect of

improving information transparency. Additionally, industry information disclosure can also

inhibit management financialization behavior through the external governance function of

information disclosure. Furthermore, industry information disclosure promotes corporate real

investment, enhances investment efficiency, and helps companies “move from the virtual

economy to the real economy,” indicating that industry information disclosure plays a positive

role in promoting company operations.

This article not only explores the economic consequences of industry information disclosure as

a form of operational information disclosure but also further enriches the economic

consequences of operational information disclosure. It also explores the impact mechanism of

operational information disclosure on corporate investment decisions, providing decision

making references for regulatory authorities to further deepen industry information disclosure

supervision.

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Government Debt Management and Corporate Innovation:

Based on Special Supervision of Government Debt Cleanup

as Quasi-Natural Experiment

JIANG Wei GAO Chunxing HU Jinyan

2025, 1(13): 129-163.

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In recent years, the interaction between local government debts and corporate

innovation has garnered significant attention from both academia and policymakers. The Third

Plenary Session further highlighted that scientific macroeconomic regulation and effective

government governance are intrinsic requirements for leveraging the advantages of the

socialist market economy system. It stressed the importance of balancing development and

security, preventing local government debt risks, constructing a high-level market economy

system, and stimulating society’s intrinsic motivation and innovative vitality. Against this

backdrop, this paper leverages a quasi-natural experiment created by the State Council’s

special supervision on clearing overdue payments owed by local governments, to investigate

the impact mechanism of overdue payment clearance on corporate innovation. This study

contributes to a comprehensive understanding of the role of effective local government

governance in the development of new-quality productivity in China and provides policy

recommendations to consolidate enterprises' status as the main actors in technology innovation

decisions, R&D investment, research organization, and the commercialization of research

outcomes.

This study employs the Difference in Differences (DID) method and Quantile Control Method

(QCM), based on the State Council’s special supervision on clearing overdue payments owed

by local governments, to examine the promotion effect of overdue payment clearance on

corporate innovation. Key findings include: ⅰ . Overdue payment clearance can alleviate

liquidity constraints for enterprises, increasing funds available for R&D and thereby enhancing

their willingness to invest in innovation. ⅱ . It also optimizes the financing environment and

mitigates market distortions, improving valuations of innovation projects and thus boosting

enterprises' inclination towards innovation investment. ⅲ.The governance effects of overdue

payment clearance are more pronounced in firms with higher levels of innovation focus and in

emerging industries. ⅳ.Further analysis using QCM reveals that regions with dense emerging

industries and effective policy implementation, such as Beijing and Hubei, exhibit the most

significant policy treatment effects.

Based on the above analysis, the following policy recommendations are proposed. Firstly,

given that overdue payment clearance significantly alleviates liquidity constraints for

enterprises, the government should further promote the full implementation of overdue

payment clearance, actively push forward the “decentralization, regulation, and service”

reform, and timely supervise the effectiveness of these reforms. Land finance has historically

driven economic growth while amplifying the fragility of local government finances,

particularly through government debt arrears, which have severely undermined the social

credit environment and reduced the effectiveness of macroeconomic regulation and

government governance. Specialized supervision facilitates the formation of local government

debt repayment mechanisms, effectively resolving debt arrears issues, reducing financial

burdens for private enterprises, enhancing business credit, and lowering financing costs,

thereby fostering effective innovation project investment opportunities and promoting

economic restructuring, the development of emerging industries, and the perfection of the

socialist market economy system. Notably, despite multiple policies issued by the central

government to resolve government debt and support private enterprises, challenges remain in

implementation due to objective conditions. During this process, it is essential to adopt

stringent measures to prevent the addition of new hidden debts and ensure genuine debt

resolution, creating a more favorable business environment for enterprise innovation and

encouraging greater engagement in technology innovation and market expansion.

Secondly, while guarding against local government debt risks, the government must prioritize

the critical role of strategic emerging industry enterprises in the innovation-driven

development strategy, vigorously cultivating the innovative vitality of private enterprises.

Under the support of land finance, local governments often pursued performance-based

expansion through excessive financing and large-scale infrastructure investments, leading to

crowding out of emerging industry innovation investments and increased government debt

pressure. Given the specific deployment of comprehensive deepening reforms outlined in the

communiqué of the Third Plenary Session, emphasizing the construction of systems to support

comprehensive innovation and the improvement of the macroeconomic governance system, the

government should accelerate the establishment of effective governance structures, actively

promote fiscal transformation, improve the management system for government debts,

establish comprehensive monitoring and regulatory systems for local government debts, and

build long-term mechanisms for preventing and resolving hidden debt risks. Accelerating the

reform and transformation of local financing platforms and providing strong support for

private enterprise innovation is imperative. Local governments need to optimize debt

expenditure structures, reasonably expand the scope of support for local government special

bonds, and enhance the innovation capabilities and competitive advantage of private

enterprises, especially those in emerging industries, through fiscal support, tax incentives, or

innovation funds.

Lastly, according to the QCM assessment results, there are significant differences in the effects

of overdue payment clearance policies across different regions. Therefore, the government

should tailor corresponding institutional constructions during the clearance process based on

the scale of local government debts and regional economic development levels, promoting

balanced regional economic development and overall enhancement of innovation capabilities.

Establishing sound legal systems, demarcating legal boundaries, and fostering a positive

business environment are key to ensuring enterprise innovation and development and are

intrinsic requirements for advancing the rule of law. On one hand, robust supervisory and

auditing systems for governmental financial management and budget execution should be

established, along with internal management and budget control mechanisms to enhance

financial transparency and accountability, ensuring timely settlement of enterprise payments

and enabling enterprises to protect their legitimate rights when facing arrears. On the other

hand, to mitigate adverse impacts on government and social credit environments and enterprise

investment caused by government arrears, the New Budget Law and other relevant financial

regulations should be used as a basis to explore new methods for repaying remaining arrears,

such as asset restructuring and debt swaps, providing legal grounds for enterprises to safeguard

their rights and supervise rectification of government arrears, thereby fostering a transparent

business environment and a proactive innovation environment that promotes a comprehensive

innovation landscape.

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The Impact of the Policy of Pre-tax Deduction for R&D

Expenses on the Level of Cooperative Innovation Activities

of Enterprises: Theoretical Analysis and Empirical Test

AN Huizhi

2025, 1(13): 164-188.

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The Third Plenary Session of the 20th Central Committee of the Communist Party

of China proposed to build a system and mechanism to support comprehensive innovation and

to enhance the overall effectiveness of the national innovation system. One of the important

specific reform measures is to increase the proportion of the policy of pre-tax deduction for

R&D expenses. At present, China's current policy of pre-tax deduction for R&D expenses

stipulates that the percentage of deduction for independent and collaborative innovation

activities of general enterprises is 100%, and the percentage of deduction for independent and

collaborative innovation activities of integrated circuit enterprises and machine tool enterprises

is 120%. In practice, how should the proportion of the policy of pre-tax deduction for R&D

expenses be increased? Should the proportion of deduction for independent innovation and

collaborative innovation be increased in the same proportion, or should there be a tendency to

give more policy incentives for a certain R&D method? What is the rationale? Much literature

has examined the innovation incentive effects of the policy of pre-tax deduction for R&D

expenses. However, the existing literature has not fully understood the impact of the policy of

pre-tax deduction for R&D expenses on firms’ collaborative innovation. With the

development of the times and the increasing complexity of technology, R&D need to be

carried out more and more cooperatively, and the latest research suggests that collaborative

innovation can play an important role in accelerating the solution to the scientific and

technological “necklace” problems that China faces. Accelerating the self-reliance of high

level science and technology requires the integration of high-quality innovation resources from

society, and cooperation between enterprises can improve the efficiency of innovation by

sharing. Only by comprehensively recognizing the implementation effect of the policy of pre

tax deduction for R&D expenses can we provide valuable lessons for the next policy reform.

This study mainly discusses the impact of the current policy of pre-tax deduction for R&D

expenses on the collaborative innovation activities of enterprises from both theoretical analysis

and empirical tests.

In contrast to the common belief that the policy of pre-tax deduction for R&D expenses will

incentivize enterprises to engage in innovation activities, the theoretical analysis finds that the

policy of pre-tax deduction for R&D expenses will change the costs of independent and

collaborative innovation in R&D projects, which will affect the relative size of the expected

benefits that enterprises can get from choosing to complete R&D projects in an independent or

collaborative way, and may lead to the fact that enterprises are more inclined to engage in

independent innovation activities. Using the data of listed private companies in China's

manufacturing industry, a Difference-in-Differences model is established to conduct an

empirical study, and the results show that the policy significantly increases the R&D

investment intensity and the number of independent invention patents filed by enterprises, but

significantly reduces the number of joint invention patents filed by enterprises with high R&D

investment intensity. For enterprises, they can or should choose whichever innovation method

can be more profitable. However, the policy of pre-tax deduction for R&D expenses is funded

by the state, and it is important to evaluate the social impact of the policy in changing the

tendency of enterprises' R&D methods. The cost of independent innovation is higher than that

of collaborative innovation, and if there are enough R&D project plans and financial

constraints on firms' innovation activities, a change in the propensity of firms' R&D

approaches will lead to a decline in the number of differentiated R&D tasks that firms can

undertake and relatively few breakthrough innovations, relative to what would have been

possible if the policy had not changed the propensity of firms to innovate in a differentiated

way. A change from one collaborative innovation activity to several independent innovations

and an increase in the number of R&D projects that need to be supported by financial

resources can lead to a waste of financial resources.

Internationally, tax incentives for R&D expenses are also commonly practiced in developed

countries. Countries such as France and Japan have set a high percentage of R&D expense

credit for collaborative innovation activities. According to Article 244 of the French tax law,

the tax credit ratio for the part of qualified R&D expenses of enterprises less than or equal to

100 million euros is 30%; the tax credit ratio for the part greater than this amount is 5%; the

tax credit ratio for qualified R&D expenses incurred by enterprises in collaborative R&D is

40% for large enterprises and 50% for small and medium-sized enterprises. Japan's tax

incentives for R&D expenses stipulate that the credit ratio for qualified R&D expenses is 2%

-14% for large enterprises and 12%-17% for SMEs. For collaborative R&D or entrusted R&D,

the credit rate is 30% for R&D expenses incurred with scientific research institutes or higher

education institutions, 25% for R&D expenses incurred with R&D venture corporations, and

20% for R&D expenses incurred with other entities (including large enterprises). The higher

credit rate for R&D expenses incurred in collaborative innovation activities is a reflection of

the emphasis on collaborative innovation in the above countries. This study concludes that the

above policy design is less likely to crowd out collaborative innovation activities and has a

better policy effect than the current policy design in China. It is suggested that when adjusting

the policy of pre-tax deduction for R&D expenses, differentiated pre-tax deduction ratios

should be designed for independent and collaborative innovation activities of enterprises, and

higher pre-tax deduction ratios should be set up for collaborative innovation activities of

enterprises relative to independent innovation activities, so as to improve incentives for

collaborative innovation activities and make the policy serve better for the development goal of

“realizing a high level of scientific and technological self-reliance and entering the forefront of

innovative countries”.

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The Impact of Integration of Urban and Rural Pension

Insurance on the Economic Resilience of Rural Households

LIU Zilan, YE Yifeng

2025, 1(13): 189-217.

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This article uses data from the China Household Finance Survey (CHFS) and

employs the overlapping generation model and the difference in differences model to

theoretically and empirically test the impact of integration of urban and rural pension

insurance on the economic resilience of rural households. The empirical results show that

integration of urban and rural pension insurance promote the economic resilience of

rural households, and this effect shows an inverted “U” shape due to changes in regional social

security levels, family life cycles, and income levels. This effect is more pronounced in

samples from regions with medium social security levels, middle-aged families, and low - to

middle-income families. Mechanism analysis shows that integration of urban and rural

pension insurance can not only alleviate short-term risk shocks, but also cultivate the long-

term development ability of rural households by increasing household financial asset allocation

and adjusting livelihood strategies, thereby enhancing their economic resilience. The research

findings in this article have policy implications for optimizing the design of the social

insurance system and promoting integrated urban-rural development.

The vision of “providing care and joy for the elderly” is a beautiful aspiration for achieving a

harmonious society. In theory, the improvement of a social security system that covers both

urban and rural residents can help narrow the urban-rural gap, improve income distribution,

enhance the quality of life and welfare for the rural population, and act as a “regulator” of

social equity and a “driving force” for social development. However, existing studies on the

effects of the integration of urban and rural pension insurance have mainly focused on static

economic growth aspects such as the income and consumption of rural households. There is

relatively limited literature that directly links the integration of urban and rural pension

insurance to the future welfare of rural households, quantifying its long-term effects.

Therefore, this paper, within a micro-welfare analysis framework, takes economic resilience as

an entry point to analyze the role of urban and rural pension insurance integration in promoting

the long-term development of rural households.

Using data from the China Household Finance Survey (CHFS) for 2013, 2015, and 2017, and

treating China's integration reform of urban and rural pension insurance as a quasi-natural

experiment, this paper empirically examines the impact of urban and rural pension insurance

integration on the economic resilience of rural households and its mechanisms. The results

show that the integration of urban and rural pension insurance helps enhance the economic

resilience of rural households, and this effect exhibits regional and household heterogeneity,

with a greater impact on samples from regions with moderate levels of social security, middle

aged households, and low and middle-income households. Further analysis indicates that the

integration of urban and rural pension insurance not only mitigates short-term risk shocks but

also fosters the long-term development capacity of rural households by increasing household

financial asset allocation and adjusting livelihood strategies, thereby improving their economic

resilience.

Our research provides a social insurance-based solution to enhance the economic resilience of

rural households and offers empirical evidence and policy recommendations for the

optimization of the urban-rural residents’ basic pension insurance system. The study shows

that the integration of urban and rural pension insurance plays an important role in improving

the economic resilience of rural households. Therefore, efforts should be made to actively

promote the economic effects and broader benefits of the urban-rural pension insurance

system, encourage rural households to participate in the insurance scheme, and incentivize

households to increase their contribution levels. At the same time, the government should

consider adopting appropriate premium reduction and subsidy measures in the design of the

urban-rural pension insurance system to alleviate the payment burden on rural households

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County Entrepreneurial Activities and Rural Industry

Revitalization: Analysis Based on the Perspective of

Dissipative Structure Theory

Deng Jinqian Chi Huiling

2025, 1(13): 218-239.

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Entrepreneurial activities can enhance income opportunities for farmers,

transitioning the rural economy from a “labor-based” to an “entrepreneurial” model.

Entrepreneurial activities play a crucial role in activating the endogenous dynamics of rural

areas and fostering industrial revitalization. This paper integrates the theory of dissipative

structures into the rural industrial revitalization framework, applying interdisciplinary methods

to explore how county-level entrepreneurial activities influence industrial revitalization. Using

panel data from 2,045 counties between 2011 and 2020, this study empirically examines the

role of county entrepreneurial activities in promoting rural industrial revitalization. The

findings indicate that these activities attract negative entropy flows—such as information and

material resources—into the revitalization system through increased employment, capital

agglomeration, and technological innovation. This process helps establish a stable, orderly

dissipative structure that drives industrial revitalization. The heterogeneity analysis reveals that

the positive impact of county-level entrepreneurial activities on industrial revitalization is more

pronounced in western regions and in counties not part of e-commerce demonstration zones.

This paper offers two key innovations: First, it applies the theory of dissipative structures to

rural industrial revitalization, using an interdisciplinary approach to examine the relationship

between county-level entrepreneurship and industrial revitalization from a novel perspective.

Second, it focuses on the county level, a crucial link in urban-rural integration, and measures

industrial revitalization across four dimensions: agricultural industry chain extension,

agricultural multifunctionality, the development of agricultural and rural service industries, and

the establishment of benefit linkage mechanisms. This empirical analysis expands the research

scope beyond provincial or prefectural levels, addressing the limitations in existing literature.

Based on the findings, this paper proposes several policy recommendations:

First, rural areas should leverage local industries and resources to actively promote

entrepreneurship and provide diverse employment opportunities for farmers. Support for

sustainable agricultural practices, such as organic farming, should be strengthened, ensuring

economic and ecological balance. Social capital should be encouraged to invest in rural

projects, utilizing financial tools like angel investments and equity funding to facilitate

economic transformation. Integrating resources such as capital, talent, technology, and markets

will ensure the sustainability of entrepreneurial activities. Digital technologies and e

commerce should be used to foster new “agriculture+” business models, enabling integrated

rural industry development and improving the business environment, which will support

farmers’ income growth and county-level economic development.

Second, policy support and capital investment should be prioritized in western regions and non

e-commerce demonstration counties. Infrastructure improvements in roads, railways, and

logistics will reduce business costs, enhance agricultural product distribution, and foster rural

industrial expansion. Talent attraction mechanisms, including entrepreneurship subsidies and

housing support, should be implemented to encourage young professionals to start businesses

in rural areas. Additionally, expanding digital inclusive finance will help alleviate funding

constraints and lower barriers for entrepreneurs.

Third, rural industries based on local resources should be developed. Encouraging farmers to

diversify into industries such as specialty farming, handicrafts, and forest-based economies

will improve industrial structure and promote value-added sectors. This will shift rural

industries from isolated production to integrated value chains covering production, sales, and

services. Leveraging local cultural heritage and natural resources will create employment

opportunities and foster a feedback loop where entrepreneurship drives job creation.

Developing local brands and region-specific products will enhance the economic

competitiveness of rural industries.

Finally, "return-home entrepreneurship" policies should be strengthened to increase awareness

and participation. Tailored policies should be developed for different villages based on local

conditions. Using technology to provide farmers with market information will expand their

opportunities and break geographical barriers. Legal support should be offered to ensure

entrepreneurs understand key regulations. Training programs will improve business

management skills and encourage innovation, helping to reduce system entropy and achieve

comprehensive rural revitalization.

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