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This paper investigates the moderating role of the macroeconomic environment in the crash risk-policy uncertainty sensitivity. We find that managers have lower risk perception and crash risk is less sensitive to policy uncertainty during periods of economic expansion. Managers' risk perception is the critical channel through which the macroeconomic environment affects the relationship between crash risk and policy uncertainty. Consequently, when firms' managers have an accurate understanding of the future economic environment, the moderating effect of economic growth is lower. This manifests in the weaker moderating effect of economic growth for SOEs and firms with stronger managerial ability, lower managerial ownership, and high media attention, which further supports the risk perception channel. [ABSTRACT FROM AUTHOR]

This paper explores China's endogeneity of economic policy uncertainty (EPU). Previous studies have disagreed on the causal relationship between uncertainty and the business cycle. By using shock-based restrictions, we identify structural shocks and investigate the endogeneity of China's EPU index. The findings suggest that an increase in EPUs is more likely to cause fluctuations in the Chinese economy than the reverse. The paper also uncovers spillovers of China's EPU on the US EPU, indicating a national strategy at play. In the long run, EPU shocks in China account for at least 22% of China's economic activity variation and 30% of the US EPU variation. These findings remain consistent when accounting for the COVID-19 period, adopting heteroskedasticity identification schemes, and using alternative EPU indexes. • Comprehending the endogeneity of EPU is essential for economic theory and policy. • China's EPU is closely linked to economic fluctuations and the US EPU. • We employ shock-based restrictions to analyze the endogeneity of China's EPU. • EPU shocks in China are a driver of economic fluctuations and US EPU. • Our results remain consistent under an alternative identification strategy and EPU index. [ABSTRACT FROM AUTHOR]

This paper examines the impact of oil price and economic policy uncertainty on China's tourism market. We point out the shortcomings of previous works considering only one factor, and prove the necessity of considering both factors at the same time. The results show that the impacts of oil price and economic policy uncertainty on China's tourism market overlap significantly, their net impact is mainly concentrated in the medium-term and long-term, respectively, and it can explain the significant variation found in China's tourism stock indexes when they are considered simultaneously. Furthermore, among subsectors, hotels are more sensitive to economic policy uncertainty, and scenic spots are most affected by oil price. [ABSTRACT FROM AUTHOR]

• Belt and road initiative does not trigger the debt trap of participating countries. • China's economic policy uncertainty has intermediary effects on the scale of the external debt for the belt & road participating countries. • The effects of China's economic policy uncertainty on belt-road countries' external debt exist the structural differences. • The effects of China's economic policy uncertainty on total external debts in the participating countries are mainly attributable to the effect on the private sector debt. This paper investigates the effects of China's economic policy uncertainty on external debts in countries involved in the Belt & Road Initiative. We first investigate an investment decision model to show heterogeneous effects on public and private debts. We then estimate such effects with recent data using a Propensity Score Matching (PSM)-Difference in Difference (DID) approach. We find that China's economic policy uncertainty has intermediary effects on the scale of the external debt For the Belt & Road participating countries. We also show that there exists a significant difference in the effects on external public and private debts. The effects of economic policy uncertainty on total external debts in the participating countries are mainly attributable to the effect on the private sector debt rather than the public sector debt. [ABSTRACT FROM AUTHOR]

This paper examines the long-term effects and related short-term movements of energy security (ENS), economic policy uncertainty (EPU), and government ecological expenditure (GEE) on China's carbon dioxide (CO 2) emissions by applying the quantile autoregressive distributed lag approach. The empirical findings demonstrate that ENS and EPU have prominent negative and positive impacts, respectively, on CO 2 emissions in the long term for the majority of quantiles, while their short-term influences are less obvious. In addition, the effect of GEE is short-term and concentrated in high quantiles. The following are the article's main contributions. This study builds special energy security indicators based on the actual situation in China, providing a basis for better understanding the interaction mechanism between ENS and CO 2. Considering that China is the largest oil importer and greenhouse gas emitter, this study explores for the first time the linkages between ENS and CO 2. Both short- and long-term impacts are observed, and long-run effects are dominant in the linkages among variables, suggesting that the level of CO 2 emissions is mainly driven by long-term shocks. In addition, to clarify the nexus between ENS and CO 2 , time- and quantile-varying analyses are used, which take into account not only varied CO 2 emission levels but also distinct time periods for events. The findings emphasize the importance of market participants to form a better understanding of how ENS, EPU, and GEE affect CO 2 under different emission levels. Some detailed policies, including optimizing the energy consumption structure, making prudent economic policy adjustments, and strengthening ecological protection expenditures, are provided to curb pollution. • Energy security and carbon neutralization are main targets for China. • Energy security negatively affects carbon dioxide in the long-term. • Time-varying and quantile-varying features are captured for Energy security. • The quantile autoregressive distributed lag model is utilized in this paper. [ABSTRACT FROM AUTHOR]

This study explores the impact of political uncertainty on sustainable urban development by examining carbon emission trading systems (ETS) in four major markets in China (Beijing, Shanghai, Guangdong, and Hubei) from 2014 to 2022. As an alternative to carbon taxes, carbon ETS markets have become increasingly popular due to their success in reducing greenhouse gas emissions. However, their effectiveness is often hindered by political instability and uncertainty. Utilising logistic regression and AR(1)-GARCH estimations, we identify a negative relationship between political uncertainty and carbon trading volume. Our study also reveals significant variations in the responses of these markets to political uncertainty. The paper contributes to the understanding of how ETS markets operate in a complex and constantly changing political environment. We suggest that policymakers need to consider the impact of political uncertainty on carbon trading when designing and implementing urban policies that promote sustainable development. Additionally, our research contributes to the development of urban policies that can be effectively implemented in both developed and developing regions. • Local government official turnovers are used as the measurement of political uncertainty. • Daily transaction data from four carbon ETS markets (Beijing, Shanghai, Hubei and Guangdong) in China • Considered the probability and proportion of zero transaction day • Logistic regression and AR(1)-GARCH estimations • A negative relationship between political uncertainty and carbon transaction volume [ABSTRACT FROM AUTHOR]

In this paper, we use a new policy uncertainty index to investigate the time-varying correlation between economic policy uncertainty (EPU) and Chinese stock market returns. The correlation is examined in the period from January 1995 to December 2016. We show that absolute changes in EPU have a significant impact on stock market returns. Specifically, empirical results based on the DCC-GARCH model reveal that the correlation between EPU and stock returns has large fluctuations, especially during a financial crisis; in addition, the impact of EPU on the Shanghai stock market is greater than on the Shenzhen stock market. Robustness results reveal that the impact of EPU on state-owned enterprises is larger than on non-state enterprises. All of these results highlight the important role of EPU in the Chinese stock market, and shed light on such issues for future research. [ABSTRACT FROM AUTHOR]

At present, the structural contradiction between Economic Financialization and the real economy's long-term weakness has become increasingly prominent. As China enters a "new normal" stage of economic growth, the real investment rate drops, non-financial enterprises continuously allocate resources to the shadow banking system. The financial economy becomes increasingly divorced from reality. This leads us to the questions: will the shadow banking behavior of non-financial companies exacerbate the risk of stock price crash risk? How does the increase in economic policy uncertainty affect the relationship between non-financial companies' shadow banking activities and stock price crash risk? This article uses non-financial listed companies' data from 2007 to 2017 and conducts empirical analysis to answer this question. The study finds that companies engaged in high-leverage, high-risk shadow banking business exacerbate stock crash risk. This effect is only pronounced in non-state-owned enterprises and low social trust regions. The increase in the degree of economic policy uncertainty positively impacts the relationship between non-financial companies' shadow banking business and stock price crash risk. The theoretical mechanism is as follows: the rise in economic policy uncertainty amplifies the positive relationship between shadow banking activities of non-financial companies and stock price crashes by increasing bank loans, investors' sensitivity to external information, risk cross-contagion, and inefficient investment mechanisms. Various robustness tests do not change the research conclusion. This paper has important theoretical and policy guidance significance for reviewing the existing diversified shadow banking system and preventing systemic risks. • Focus on non-financial enterprises' shadow banking behavior. • Provides a theoretical basis for the factors of the risk of stock price collapse. • Further explores the adjustment effect of economic policy uncertainty. • Provides policy guidelines for preventing systemic financial risks. [ABSTRACT FROM AUTHOR]

Using the data of 52 traditional energy enterprises and 116 renewable energy enterprises of China from 2007Q1 to 2017Q4, this paper investigates the differential impact of economic policy uncertainty on different types of energy enterprises' investment using a panel regression model. The paper further analyzes the regulatory effect of enterprises' characteristics, such as growth opportunities, financing constraints, external demand, and ownership concentration, on the relationship between economic policy uncertainty and investment. It concludes that first, economic policy uncertainty significantly inhibits traditional energy enterprises' investment, with a coefficient of 0.0042, whereas the effect is not significant for renewable energy enterprises. Second, economic policy uncertainty inhibits the investment of coal and petroleum enterprises, with coefficients of 0.0046 and 0.0054 respectively. Whereas it significantly promotes the investment of solar energy, geothermal energy and other renewable energy enterprises, with effect degree of 0.0032, 0.0033 and 0.0031, respectively. Third, growth opportunities can offset the inhibitory effect of economic policy uncertainty on investment. Besides, with the strengthening of financing constraints, economic policy uncertainty increases traditional energy enterprises' investment, though the effect is not significant for renewable energy enterprises. Moreover, the regulatory effect of external demand is not significant for both traditional and renewable energy enterprises. Further, the ownership concentration can strengthen the inhibitory effect of economic policy uncertainty on renewable energy enterprises' investment, but it is not significant for the traditional energy enterprises. Fourth, the regulatory effect of enterprise type is significantly different for coal and petroleum enterprises. Image 1 • We investigate the impact of economic policy uncertainty on investment of different energy enterprises. • Economic policy uncertainty significantly inhibits traditional energy enterprises' investment, but promotes the investment of renewable energy enterprises. • Growth opportunities can offset the inhibitory effect of economic policy uncertainty on investment. • With the strengthening of financing constraints, economic policy uncertainty increases traditional energy enterprises' investment. • The ownership concentration can strengthen the inhibitory effect of economic policy uncertainty on renewable energy enterprises' investment. [ABSTRACT FROM AUTHOR]

In this paper, we investigate the chaotic behavior and multi-fractal features of economic police uncertainty in China, the US and the global. Furtherly, we analyze the nonlinear correlations and interactions of the three EPU indices. Our results show that, the EPU indices in China, the US and the global have nonlinear characteristics of chaos and multifractality. As the world's first and second largest economies, the US and China have significant interactions in their EPU indices and there are significant mutual influence between EPU indices in China, the US and the global. However, after China became the world's second largest economy, the chaos of China's EPU has increased, while that of the US has decreased; The nonlinear correlation of EPU between China and the global has increased significantly, while that between the US and the global has decreased significantly; There is a significant interaction of EPU index between China and the global, while the EPU index of the US is no longer affected by the global. These phenomena are closely related to the strategy pursued by China and the US. • The EPU indices in China, the US and the global are all chaotic series having the multifractality. • The EPU indices in US and China interact with the global respectively. • After China became the world's second largest economy: The chaos of China's EPU index has increased, while that of the US has weakened. China's EPU was affected by the US, but the US EPU is no longer affected by the global. [ABSTRACT FROM AUTHOR]

This paper investigates the influence of host and home country institutional conditions on foreign institutional investment. Utilizing longitudinal and multilevel data on foreign institutional investment in Chinese listed firms between 2004 and 2017, we document that foreign institutional investment decreases with increasing economic policy uncertainty in the host nation. We also find that foreign institutional investors respond more strongly to local economic policy uncertainty when their home nations are closer to China, are culturally and administratively similar to China, operate a smaller domestic stock market, and have weaker minority shareholder protection. The impact of economic policy uncertainty on foreign institutional investment is also stronger when the host nation institution is more developed and open.. Moreover, we reveal the mediating role of stock market volatility on this relationship. Overall, we document that foreign institutional investment is not only shaped by institutional conditions in the host country but also influenced by home country characteristics that define geographical and institutional distance between home and host nations. • Foreign institutional investors reduce investment when the host nation's economic policy uncertainty is high. • This relationship is moderated by geographical and institutional distance between home and host nations. • The relationship is also moderated by institutional conditions in the host country. • Stock market volatility mediates the response of foreign institutional investors to economic policy uncertainty. [ABSTRACT FROM AUTHOR]

• The R&D technical efficiency and business transformation efficiency of China's hi-tech industry have an obvious spatial spillover effect. • The SAR Tobit econometric model is utilized to investigate the main effect, masking effect and moderating effect of preferential tax policy on the two-phase innovation efficiency of China's hi-tech industries. • Economic policy uncertainty negatively regulates the relationship between preferential tax policies and R&D technical efficiency. • R&D personnel flow plays a masking effect between preferential tax policy and the two-phase innovation efficiency of China's hi-tech industries. • Regional heterogeneity is apparent in regional regression. As an emerging economy, the two-phase innovation inefficiency of China's hi-tech industry caused by a preferential tax policy should be addressed. Using the SAR Tobit econometric model and the panel data from China's 30 regional hi-tech industries covering 2004–2016, this paper investigates the main effect, masking effect and moderating effect of preferential tax policy on the two-phase innovation efficiency of China's hi-tech industries. We find that the R&D technical efficiency and business transformation efficiency of China's hi-tech industries have remarkably spatial autocorrelation and spatial spillover effects. The preferential tax policy has an obvious crowding-in effect on R&D technical efficiency and an obvious crowding-out effect on business transformation efficiency. Economic policy uncertainty negatively regulates the relationship between preferential tax policies and R&D technical efficiency. Regional heterogeneity is apparent in regional regression. Preferential tax policy can facilitate the R&D technical efficiency in coastal areas and in inland areas, while only preferential tax policy positively contributes to business transformation efficiency in coastal areas. In the R&D technology stage, the negative indirect effect of R&D personnel flow weakens the positive direct effect of the preferential tax policy, which is manifested as an obvious masking effect; in the business transformation stage, the positive indirect effect of R&D personnel flow weakens the negative direct effect of the preferential tax policy, which is manifested as an obvious masking effect. The research results provide a reference for the scientific formulation of national tax preferential policies, the design of innovative talent flow policies and the promotion strategies of innovation efficiency of hi-tech industries. [ABSTRACT FROM AUTHOR]

Emerging industrialized countries are confronted with the fundamental reality of an increasingly uncertain and unstable economic policy environment. In case of China this paper examined how the transformation of inclusive green growth, from a "beggar-thy-neighbor" approach to a "neighbor-friendly" approach, can be realized. From the perspective of a "pollution paradise", this study regarded haze pollution as a mediator to examine the driving mechanism underlying the influence of economic policy uncertainty on inclusive green growth. Moreover, media attention was introduced as a moderator to explore the institutional scenario that drives inclusive green growth in China. This study used panel data from 30 provinces for the period 2006–2016, and employed the Spatial Durbin model for empirical testing. The findings showed that the influence of EPU on inclusive green growth was multi-dimensional, and this included the direct "policy-economic" effect, the partial intermediary effect of a beggar-thy-neighbor model which was reflected by haze pollution, and the moderating effect of a neighbor-friendly approach via media attention. Furthermore, the results revealed an inverted-U-shaped relationship between haze pollution and inclusive green growth. Finally, media attention can effectively regulate the negative impact of economic policy uncertainty and haze pollution on inclusive green growth, and realize the transformation of inclusive green growth from a beggar-thy-neighbor policy to a neighbor-friendly policy. This study presents a new perspective for understanding the economic consequences of economic policy uncertainty and provides an empirical framework that guide local governments about climate governance. • Examine how the transformation of inclusive green growth can be realized. • Haze pollution and media attention were introduced as a mediator and a moderator, respectively. • The influence of EPU on inclusive green growth was multi-dimensional. • There was an inverted-U-shaped relationship between haze pollution and inclusive green growth. [ABSTRACT FROM AUTHOR]

This paper aims to investigate the economic risk contagion among major economies in the world by utilizing an innovative spillover analysis method accompanied with data from economic policy uncertainty (EPU) indices. To obtain more robust conclusions, the risk spillover effects are detected in both time and frequency domains. The empirical results show that, first of all, in terms of time-domain framework, the top six largest economies has strong connectedness in economic risk (uncertainty) and US seems to be both the major risk spillover contributor and receiver among these major economies. While regarding to frequency-domain analysis, most risk spillover effects are observed only in short-term frequency at 1 to 3 months. Secondly, the static net EPU spillover effects indicates that US, in average, is the key spillover transmitter and UK as well as China are the major spillover receivers. Finally, the dynamic rolling-window results confirm that with time-varying domestic and global economic situations, no country is identified as a successive net EPU spillover contributor or receiver across both time and various frequency domains. China, however, is presenting its upward economic strength and outside impacts in global economy system since about 2017. • Economic risk contagion is analyzed in both time and frequency domains. • EPU indices of six major economies are employed as proxies of economic risk. • Both static and time-varying spillover effects are calculated. • US are the major risk spillover contributor and receiver. • Economic risk spillovers are mainly observed in short-term frequency. [ABSTRACT FROM AUTHOR]