Date: 19 Oct 2023 (Thu)
Capital Market Development: China and Asia
- How Do Firms Withstand a Global Economic Shock:
Evidence From Within Firm Responses
19 October 2023, Thursday
9:00 am – 10:10 am (Singapore Time, GMT+8)
[ How Do Firms Withstand a Global Economic Shcok: Evidence From Within-Firm Responses ]
China’s Five-Year Plans (industrial policies targeting specific industries) displace US production/employment and heighten plant closures in the same industries. The shocks were not anticipated by the U.S. stock market, but firms in the treated industries suffer valuation loss afterwards. Firms adjust by shifting production to upstream or downstream industries benefiting from the boost, or offshoring to government-endorsed industries in China. Such within-firm adjustments offset the negative shocks among firms with pre-existing toeholds in the “beneficiary” industries or production overseas, suggesting a novel role of diversification. Financial access and labor fluidity are instrumental for firms to withstand global economic shocks.
Vyacheslav (Slava) FOS, Professor, Hillenbrand Family Faculty Fellow, Carroll School of Management, Boston College
Xiao CEN, Assistant Professor,Mays Business School, Texas A&M University
Wei JIANG, Vice Dean for Faculty and Research and Asa Griggs Candler Professor of Finance, Goizueta Business School, Emory University
Kai LI, Associate Professor, HSBC Business School, Peking University
About the Webinar
Financial market development goes hand-in-hand with economic growth. The development of China's capital markets in terms of size, regulations, capability, and efficiency has been impressive. China may now even lead globally in some dimensions, notably e-payments systems. Yet, China's capital markets are still a work-in-progress facing both generic and unique challenges. Other Asian capital markets have even greater uneven development. Some in advanced Asian economies have acquired globally acclaimed reputation and capabilities while various regulatory and structural weaknesses dwarf others. Corporations and investors have been inclined to arbitrage cross-border regulatory and developmental gaps; so the very uneven status of capital markets across Asia is a policy issue for the governments in the entire region and perhaps globally. Analysing the positive and negative lessons in the functioning of Asia's capital markets, and identifying reforms and applications of technology that could further improve Asian capital markets' allocation efficiency, financial inclusion, and forewarning against reforms that might cause problems can benefit practitioners, policymakers and researchers, and can contribute significantly to overall prosperity.
The ABFER and the University of Chicago's Becker Friedman Institute China (BFI-China), in collaboration with National University of Singapore (NUS) Business School, Shanghai Advanced Institute of Finance (SAIF), The Chinese University of Hong Kong (CUHK) Department of Economics, CUHK-Shenzhen and Tsinghua University PBC School of Finance (Tsinghua PBCSF), hope to provide a virtual network to benefit researchers, policymakers, and practitioners from Asia and beyond.