Chinese Industrial Enterprises Database Research Articles

Has Artificial Intelligence Promoted Manufacturing Servitization: Evidence from Chinese Enterprises

Artificial intelligence, as a novel form of infrastructure with both generality and knowledge spillover characteristics, plays a crucial role in facilitating the profound integration of the manufacturing and service industries, and achieving economic transformation. This paper empirically investigates the impacts of artificial intelligence on the process of manufacturing servitization, utilizing merged data from the OECD-ICIOT (Organization for Economic Co-operation and Development, Intercountry Input-Output Tables) industry data, the Chinese industrial enterprise database, and the customs trade database. The empirical findings of this research demonstrate that artificial intelligence has significant and positive effects on manufacturing servitization. These positive effects primarily occur through two channels: enhancing total factor productivity and optimizing the labor skill structure. Furthermore, this study examines the variations in the impact of artificial intelligence on the transformation of embedded services and blended services. The analysis reveals that artificial intelligence significantly promotes the transformation of embedded services, while its impact on the transformation of blended services is comparatively less pronounced.

Does excess capacity strengthen firms' dependence on the polluting path? Evidence from Chinese iron and steel firms

AbstractThis paper studies the relationship between firms' excess capacity and their environmental behaviour by matching the environmental data of China's major iron and steel firms with the Chinese Industrial Enterprises database. The findings are as follows. (1) A firm's excess capacity leads to myopic decisions, and firms will pay more attention to short‐run economic benefits at the cost of long‐run environmental benefits, which strengthens their dependence on the polluting path. (2) The dependence is positively correlated with the transformation barriers, and either a higher innovation cost or a higher possibility of regulatory capture in local official governance would lead to greater dependence on the pollution path. (3) Mergers & acquisitions (M&As) may hopefully cut such dependency, but only cross‐provincial M&As led by central state‐owned enterprises (SOEs) can effectively alleviate the “pollution effect” of excess capacity, while intra‐provincial M&As led by local SOEs fail to achieve such a goal.

Assessment of environmental concern for enterprise pollution reduction

Environmental regulation produces different effects in different regions. Public concern for the environment in different regions may affect the effectiveness of environmental regulation. Using the pollution emission data of the Chinese Industrial Enterprise Database and the Baidu Index, this paper uses econometric models to evaluate the effect of public environmental concern on enterprise pollution emissions. Results show that public environmental concern reduces enterprise emissions with a coefficient of -3.026. Further research shows that the negative relationship between public environmental concern and pollution emissions is significant for state-owned enterprises, longer-established enterprises, and enterprises in cities with high GDP, in populated areas, and in cities with a higher concentration of secondary industries. Through mechanism analysis, we found that the public can urge enterprises to reduce emissions through centralized treatment of wastewater, harmless treatment of garbage, and increasing green areas, and enterprises should take corresponding measures for different emissions. Finally, we present suggestions for pluralistic co-governance from the perspectives of the government, enterprises, and the media.

The value discovery of foreign direct investment: Based on the study of the crowding-out effect of zombie enterprises on investment

Foreign direct investment (FDI) is of great significance to the economic development of developing countries; it infuses capital into enterprises, while propeling both technological advancement and economic efficiency. We examine whether zombie enterprises crowd out FDI inflows and whether the institutional environment can alleviate this effect. Using the Chinese Industrial Enterprise Database from 2003 to 2013 to calculate zombie shares at the prefecture-level cities and applying the OLS and instrumental variable estimation, we find that the larger the zombie shares, the less FDI inflows. That is, zombies do crowd out FDI inflows—a finding robust to specifications. We also find that the geographical advantage and greater openness to the outside world can alleviate the crowding-out effect. Further, we investigate the moderating effect of the institutional environment on the crowding-out effect. We find that market segmentation and government corruption will aggravate the crowding-out effect while strengthening intellectual property protection, improving the trust environment, and factor market development will alleviate it. Overall, our study explains impediments to FDI inflows by accounting for zombie enterprises. It provides insights for local governments seeking to clean up zombies and strengthen the institutional environment to attract FDI inflows.

The Impact of Financial Geographical Structure on Corporate Pollution Emissions

This chapter takes a macro perspective on the financial geographical structure, starting from the perspective of financial agglomeration and financial center spillover. Based on the Chinese industrial enterprise database, Chinese pollution emission database, and the China City Statistical Yearbook, it explores the impact of financial geographical structure on corporate pollution reduction. The study finds that local financial agglomeration and financial center spillover can significantly reduce the intensity of corporate pollution emissions, which remains robust after a series of rigorous tests. Mechanism analysis indicates that local financial agglomeration and financial center spillover can promote corporate pollution reduction through the effect of technological innovation. The research conclusions of this chapter can provide new insights for deepening the structural reform of financial supply side.

How does bank competition affect trade-mode transformation? Evidence from Chinese export enterprises

This study investigates the effect of banking competition on the transformation of Chinese firms' export trade mode. We use matched data from the Chinese Industrial Enterprise Database and the Chinese Customs Trade Statistics between 2007 and 2013 to measure export firm trade-mode, and apply the number of commercial bank branches at the prefecture level to gauge bank competitiveness. With a large firm-level dataset, we find that bank competition affects a company's transition from processing mode to ordinary trade. The validity of our findings is confirmed through several robustness tests. Furthermore, we examine the underlying processes through which bank competition influences trade-mode transformation by means of firms' financial constraints, the regional marketization process and banking structural characteristics. Finally, we investigate the heterogeneity conditions and find that firms with distinct ownership structures and in different geographical locations demonstrate diverse performances in the aforementioned connection. The empirical findings provide crucial evidence to enhance the understanding of the relationship between banking institutions and company exports in emerging economies.

Do cleaner production standards upgrade the global value chain position of manufacturing enterprises? Empirical evidence from China

The harmonious development of trade and environment is extremely crucial for developing countries that face challenges posed by extensive economic models and environmental pollution as they strive to engage more deeply in the global economy. This article utilizes micro-level data from the Chinese Industrial Enterprises Database (CIED) and the Chinese Customs Trade Database (CCTD) from 2000 to 2012. It takes China's implementation of cleaner production standards (CPS) since 2003 as a quasi-natural experiment and applies staggered DID to investigate the impact and mechanisms of exogenous shocks from environmental policies on upgrading and transformation of enterprise value chains. The aim is to provide comprehensive empirical evidence regarding the availability of environmental regulations and the GVC position of Chinese enterprises. Thus, we also offer valuable insights for similar developing countries seeking a path toward high-quality advancement. The research findings are as follows. First, CPS exerts a significant upgrading effect on enterprise value chains, and this conclusion is highly robust. Second, heterogeneity analysis reveals that the upgrading effect of CPS on value chains is predominantly influenced by factors including the enterprise's asset scale, ownership structure, geographical location, trade pattern, as well as the technological level and pollution intensity within its specific industry. Third, further tests through mechanism analysis reveal that CPS expedited the integration of Chinese manufacturing enterprises in GVC by promoting innovation and R&D capabilities, enhancing total factor productivity, and improving labor wages.

Fostering sustainability: unveiling the impact of Internet development on carbon emissions in China.

The rapid development of the Internet has significantly impacted various socio-economic activities. Using Chinese Industrial Enterprise database and Industrial Enterprise Pollution database, this research examines the impact and mechanisms of Internet development on CO2 emissions. The key findings are as follows: (1) Internet development has substantially reduced the CO2 intensity of enterprises, and this conclusion remains robust even after performing a series of robustness analyses. (2) The major mechanisms responsible for the reduction in CO2 emissions are productivity improvement, technological innovation, and energy structure adjustment. (3) The analysis of heterogeneity reveals that the effect of Internet development on CO2 reduction is more pronounced in coastal areas, areas with a high share of secondary industry, low-carbon industries, clean industries, small-scale enterprises, and export enterprises. This study provides empirical evidence supporting China's "Internet+" strategy and its progress towards achieving the "Carbon Peaking and Carbon Neutrality Goals."

The impact of digital inputs on pollution reduction in Chinese manufacturing enterprises

Facilitating pollution reduction in manufacturing enterprises is crucial for implementing the new development concept and achieving sustainable, environmentally friendly growth. This research delves into the influence of digital inputs on pollution emission reduction in Chinese manufacturing enterprises. The study utilizes a combination of the World Input-Output Database, the Chinese Industrial Enterprises Database, and the Chinese Industrial Enterprises Pollution Emission Database covering the period from 2000 to 2012. The findings reveal that digital inputs make a significant contribution to pollution reduction in Chinese manufacturing enterprises. Specifically, digital software inputs and foreign digital factor inputs display more pronounced effects on pollution reduction. The analysis of the mechanism reveals that the pollution reduction effects of digital inputs in manufacturing enterprises can be attributed to several effective mechanisms: the enhancement of energy efficiency, technological innovation, and servitization, as well as the crowding-out effect of pollution control investment. The former mechanisms demonstrate a promoting effect, while the latter exhibits an inhibiting effect. The impact of digital inputs on pollution reduction in manufacturing enterprises displays heterogeneity, with a more significant emission reduction effect observed in industries facing higher environmental regulatory intensity, digitization-unrelated industries, non-state-owned firms, and firms with higher levels of financing constraints. These findings offer empirical evidence and serve as a policy foundation for promoting digital transformation and achieving green economic development in China.

The Location Choice and Survival of Polluting Firms under Environmental Regulation in Urban Agglomerations of China

There are few studies discussing the relationship between the increasing intensity of environmental regulation in the central cities of urban agglomerations, which is the main method used to solve the problem of regional environmental pollution, with the survival status of polluting firms in different spatial locations. In order to more clearly describe the evolution trend of the spatial distribution of polluting firms and coordinate inter-city environmental regulation policies in a more targeted manner, we examine the impact of polluting firms’ location choice on their survival under the central–periphery spatial structure in national-level urban agglomerations from 1998 to 2013 with the accelerated failure time (AFT) model and Cox proportional hazards (Cox PH) model and using matching data of the Chinese Industrial Enterprise Database and the Chinese Industrial Enterprise Pollution Emission Database. The results find that (1) under the influence of central cities’ environmental regulations, there is likely to be an inverted U-shaped relationship between the survival of polluting firms and their spatial distance from the central cities; (2) the inverted U-shaped relationship is the motivation of the interaction between environmental regulation and market potential, which means increases in the environmental regulation intensity in the central cities of the urban agglomeration will have a negative effect on the survival of polluting firms, and the central cities’ market potential will partially offset the negative impact; (3) the inverted U-shaped relationship is more significant for private firms, and it does not necessarily exist for new entrants. The above results help to provide important policy inspiration for promoting the joint prevention and control mechanism for pollution in urban agglomerations and coordinate the effects of environmental regulation and economic transformation policies between central and peripheral cities.

Does a mandatory cleaner production audit have a synergistic effect on reducing pollution and carbon emissions?

The mandatory cleaner production audit (MCPA) is an important initiative to promote energy conservation, emission reduction and green transformation and upgrading of enterprises. This paper matches 16,841 enterprises that implemented MCPA between 2003 and 2012 to the Chinese Industrial Enterprise Database and the Chinese Enterprise Pollution Emission Database. And carrying out the MCPA as a quasi-natural experiment, a difference-in-differences model based on propensity score matching is used to identify the net effect of it on the reduction of enterprise sulfur dioxide (SO2) emissions. The paper discovers that MCPA can significantly reduce the intensity of SO2 emissions, and this finding is robust to multiple scenarios. According to heterogeneity analysis, the MCPA is more conducive to reducing the intensity of SO2 emissions in domestic enterprises, enterprises with low financing constraints and heavily polluting industries. Mechanism tests show that MCPA can reduce SO2 emissions by optimising energy structure, increasing energy efficiency, and encouraging green process innovation. Further analysis reveals that the MCPA is an effective tool for achieving the synergistic effect of reducing SO2 and carbon dioxide (CO2) emissions in enterprises, and it serves the dual function of winning the pollution battle while also achieving the carbon peaking and carbon neutrality goals.

The Path Choice of Manufacturing Enterprises to Enhance Competitiveness

How to enhance the competitiveness of manufacturing enterprises using innovation is an important topic in theory and practice. Data from the world input-output table and the Chinese industrial enterprise database are used to study the difference in the influence of service transformation and product innovation on enterprise competitiveness. The authors show that (1) both service transformation and product innovation contribute to enhancing enterprise competitiveness, but the former has a better effect, and this conclusion is still valid after replacing variables and controlling for endogeneity, and and (2) the “competitiveness effect” of service transformation and product innovation has strong heterogeneity in urban administrative levels, GVC embedding location, and enterprise ownership. (3) As two different innovation methods, service transformation and product innovation have synergistic and balanced effects.

Can intellectual property protection promote domestic value added in exports? Evidence from mainland China

Based on a unified framework, this study explores the influence of regional intellectual property protection (IPP) on domestic value added in exports. A theoretical model is constructed to illustrate that IPP affects the types and prices of intermediate goods through effects of market power, product category, and crowding-out, influences the choice of domestic and imported raw materials, and finally affects the domestic added value in exports of enterprises. Empirical evidence on the influence of IPP on the domestic added value in exports is provided utilizing China Customs Statistics, the Chinese Industrial Enterprise Database, and Chinese prefectural-level data from 2000 to 2007. The results show that IPP significantly promotes the domestic value added of exports in China, but the effect is heterogeneous in terms of region and mode of enterprise trade; in the eastern region and processing trade enterprises the IPP effect is more pronounced.

The characteristics analysis of credit reallocation in China's corporate sector: From the volatility, spatiality, cyclicality and efficiency approach

In this paper, taking the non-financial and non-real estate firms included in Chinese Industrial Enterprise Database from 2004 to 2014 as a sample, we study the characteristics of credit reallocation in the corporate sector. Firstly, based on credit reallocation indicators, we describe the volatility, spatiality, and cyclicality of credit reallocation in China's corporate sector, and find that the cyclicality satisfies one path of Schumpeter's conjecture. Secondly, we analyze the efficiency of China's credit reallocation, and find that it violates one path of Schumpeter's conjecture. The conclusions are: (i) The net change of credit aggregate masks the massive credit reallocation, credit destruction is more volatile than credit creation, and the trend of credit reallocation is similar to that of credit creation. (ii) China's credit reallocation is cross-provincial and intra-regional. (iii) China's credit reallocation is countercyclical. (iv) China's credit reallocation has a scale effect; however, it does not have a cleansing effect, and the economic downturn will make it even less cleansing effect.

Impact of digital input on enterprise green productivity: Micro evidence from the Chinese manufacturing industry

Digital input, as an important engine for high-quality development, has provided new impetus for green transformation and development of manufacturing enterprises. In this study, unique panel data samples matched from the Global Multi-regional Input-output Database from 2000 to 2014, the Chinese Industrial Enterprise database, and the Chinese Industrial Enterprise Pollution Database are used to estimate the green productivity of Chinese manufacturing enterprises by adopting a non-radial and non-angular SBM model that considers unexpected outputs. Furthermore, a panel Tobit model is adopted to empirically test the impact of digital input on the green productivity of manufacturing enterprises. The research results indicate that: (1) Digital input has a significant positive impact on the green productivity of manufacturing enterprises, and a series of robustness tests have confirmed this conclusion. This research conclusion provides micro evidence and empirical support for empowering the green transformation of manufacturing enterprises with digital economic development. (2) The heterogeneity analysis indicates that, for different enterprises, digital input contributes more significantly to green productivity in foreign-funded enterprises, state-owned enterprises, and larger-scale enterprises. Regarding industry types, digital input positively contributes to green productivity only in labor-intensive and knowledge-technology-intensive manufacturing enterprises. In terms of regions, the contribution of digital input to the green productivity of enterprises in the east and central regions and regions with higher levels of industrial agglomeration is more significant. Heterogeneity analysis from different perspectives can help optimize enterprise choice behavior and green transformation development strategies, thus achieving better digital empowerment. (3) Further mechanism tests reveal that digital input promotes the improvement of green productivity of manufacturing enterprises through the effects of technological progress, factor structure optimization, and innovation, thereby providing a feasible path for relying on digital transformation to promote the improvement of green productivity of manufacturing enterprises.

Does China's low-carbon city pilot intervention limit electricity consumption? An analysis of industrial energy efficiency using time-varying DID model

Emissions depletion through pro-environmental interventions by top emitters like China has profound significance in improving the atmosphere's cumulative carbon efficiency. China's electricity sector is accountable for almost 40% of its total aggregated emissions, indicating that China's electricity sector does not yet follow the energy conservation and energy efficiency theories, which require urgent attention if China aspires to achieve carbon emissions peak and neutrality by 2030 and 2050, respectively. Chinese lawmakers have adopted pro-environmental interventions to limit emissions, like constructing low-carbon city pilots (LCCP). LCCP intervention has successfully curbed emissions in China's major cities, which earlier studies have validated. However, no study assesses whether the LCCP intervention supports enterprises in reducing their electric energy consumption intensity (EECI) by upgrading their energy conservation attitude and improving power efficiency. To address this fundamental question, we construct a time-varying difference-in-difference (DID) model to comprehensively investigate the consequences of LCCP intervention on EECI, using matched data from the Chinese Enterprise Pollution Emissions Database and the Chinese Industrial Enterprise Database from 2007 to 2014. The findings unfold as follows: 1) The LCCP intervention significantly reduces the firm's electricity consumption intensity (i.e., a one percentage point increase in LCCP curbs EECI by 3.14%). 2) We observe significant heterogeneity in the effect of LCCP on EECI based on the ownership, location, and input characteristics of the intervened firms (i.e., LCCP has an insignificant effect on EECI for firms that are state-owned, labor-driven, and located in western zones. However, it has a more substantial inhibitory effect on EECI for firms that are: located in non-resource-based cities, foreign and private-owned, capital and technology-driven, and non-western). 3) The LCCP intervention promotes enterprises' power consumption via the energy-saving and green innovation effects, which boosts enterprises' energy conservation attitude and energy efficiency in the long term. The conclusion remains untapped after mitigating sequence-related issues, limiting the influence of alternative policies, employing lagged terms, and deploying different estimation strategies (i.e., PSM-DID). Several policies have been advocated in line with the findings in the ultimate section.

Law Reinforcement, Production Pattern and Enterprise Environmental Performance: Evidence from Environmental Courts in China

Law reinforcement agencies can be established to improve enterprise environmental performance, a determinant of sustainable growth, but their micropractical evaluation is unclear. This paper uses panel data (1998–2014) from the Chinese Industrial Enterprise Pollution Database and the Chinese Industrial Enterprise Database and adopts the multiperiod difference-in-differences (DID) method to investigate the impact of law reinforcement on enterprise environmental performance (measured by air pollutant emissions). Using the establishment of China’s city-level environmental courts (ECs) as an identification strategy, the study finds a strong positive effect of EC establishment on firms’ environmental performance and confirms the validity of law reinforcement. Furthermore, the effects are heterogeneous for firms with different characteristics (including scale, profit, ownership, pollution intensity and location). Notably, we find that firms improve their environmental performance by changing their production pattern and energy consumption structure. Additionally, ECs could influence firms’ environmental behaviors by enhancing judicial efficiency and generating a deterrence effect. These findings show the government could improve enterprises’ environmental performance through law reinforcement but should consider the heterogeneous effect on different firms.

Business Environment and Resource Allocation Based on the Perspective of the National Value Chain.

China is actively upgrading its industrial structure through industries transferring between developed and undeveloped areas; however, the overall level of the national value chain is still not high, and the asymmetric competition pattern between the upstream and the downstream has not been broken. Therefore, this paper establishes a competitive equilibrium model for the production of manufacturing enterprises, with factor price distortion, under the condition of constant returns to scale. The authors derive the relative distortion coefficients of each factor price, calculate the misallocation indices of capital and labor, and construct an industry resource misallocation measure. Furthermore, this paper applies the regional value-added decomposition model to calculate the national value chain index and matches the market index of the China Market Index Database with the Chinese Industrial Enterprises Database and the Inter-Regional Input-Output Tables through quantitative analysis. From the perspective of the national value chain, the authors study the improvement effect and mechanism of the business environment on the resource allocation in industry. The study shows that industry resource allocation will be improved by 17.89% if the business environment level is improved by one standard deviation. This effect is most prevalent in the eastern and central regions, not so much in the west; the effect of downstream industries in the national value chain is higher than that of upstream industries; the improvement effect on capital allocation is higher in downstream industries than in the upstream industries; and the improvement effect on labor misallocation is basically the same in both the upstream and the downstream. Compared with labor intensive industries, capital intensive industries are more influenced by the national value chain, while the effect of upstream industries is weaker. At the same time, it is well documented that participation in the global value chain can improve the efficiency of regional resource allocation, and the construction of high-tech zones can improve resource allocation for both upstream and downstream industries. Based on the results of study, the authors propose suggestions for optimizing business environments, suiting the national value chain construction, and improving resource allocation in the future.

How effective has the low-carbon city pilot policy been as an environmental intervention in curbing pollution? Evidence from Chinese industrial enterprises

In response to China's burgeoning environmental pollution, since 2010, Chinese policymakers have implemented a low-carbon city pilot policy (LCCP) and expanded the pilot project's dimension since then. An accurate evaluation of the consequences of this environmental intervention is vital for the further promotion and extension of this pilot project. In this milieu, we develop a framework to put credibility on this newly intervened policy by harnessing robust econometric approaches. To achieve this objective, we garner integrated data from 2006 to 2014, sourced from two distinct databases: the Chinese Industrial Enterprise database and the China Enterprise Pollution Emissions database. This paper deploys a time-varying Difference in Difference (DID) approach to scrutinize the influence of LCCP on China's emissions reduction agenda from a micro-perspective. The findings reveal that: (1) LCCP significantly reduces enterprise pollution by promoting eco-friendly technologies and innovation capacity; (2) LCCP promotes healthy urbanization and restores the urban ecosystem by abating emissions intensities significantly (i.e., for every one percentage point increase in LCCP, firm-level emissions plummet by 1.87%); (3) LCCP efficacy in controlling emissions varies in terms of ownership, type and location of the firms (i.e., LCCP policy is more efficacious in controlling emissions if the firm is foreign or private-owned if it is a capital and technology-intensive high polluting firm and if the firm is located in eastern and western zones of the country). The findings are robust after replacing the explained variables, changing the estimation method, excluding the interference of outliers, considering the lagged term, and excluding other policy interference. Based on the findings, this study touts the Chinese Government's LCCP policy by providing firm-level theoretical support and empirical evidence for China to boost the revamping strategy of carbon-neutral cities. Therefore, the benefits of pilot cities should be further harnessed to guide enterprises in low-carbon pilot cities so that they can engage in cleaner production activities and achieve green transformation through policy preferences and other incentives. Further policy suggestions have been made in the relevant section.

The pollution reduction effect of official turnover: evidence from China

Under the political system with Chinese characteristics, the turnover of regional officials becomes a norm. So the uncertainty generated by the turnover of officials can often have an impact on the pollution emissions of regional enterprises. This paper examines the impact of official turnover on corporate pollution emissions using the Chinese industrial enterprise database and pollution emission database from 2004 to 2014 in China, while matching urban panel data of prefecture-level cities. The empirical study finds that official turnover significantly reduces the pollution emission of enterprises in that year, while the effect of official turnover from economically developed to economically backward regions and from economically backward to economically developed regions on enterprises' pollution emissions is significantly different. Also, this paper finds that the turnover of officials has a short-term effect on the reduction of corporate pollution emissions. The pollution abatement effect of official turnover is more pronounced in non-resource cities and non-state enterprises. Further analysis reveals that the pollution reduction effect of official turnover is more pronounced when the age of officials is greater than the promotion age threshold of 54 years. Finally, a series of robustness tests were conducted in this paper, while the Heckman two-step method was used to test for endogeneity, and the conclusions reached remained consistent with the benchmark regression.