While much of international marketing research involves two or more levels, limited work in the international marketing literature uses hierarchical linear modeling to examine different level effects. This study conducts a thorough literature review on hierarchical linear modeling (HLM) in 28 international marketing papers that employed HLM from 2005-2014 and evaluates the use of HLM in these papers on the objects, operating levels, and other issues. We call for more applications of HLM in international marketing research, particularly for research on emerging markets with significant sub-national and institutional variations. The paper provides an illustrative empirical study that employs HLM to test the moderating role of industry-level government subsidies in the relationship between firm innovation and exporter performance in China.

The corporate governance of Chinese state-controlled listed companies (SCLCs) has attracted much scholarly attention. Through reviewing the extant literature in this field, it is clear that the overwhelming majority is theoretically underpinned by the lens of agency costs. Another important perspective, adaptive efficiency, has yet to be equally emphasized by scholars. Reflecting on the experience of American venture capital (VC), this article puts forth that the corporate governance of SCLCs has weakened the fundraising ability of Chinese domestic VC. Taking account of the positive link of a vibrant VC sector and the enhancement of adaptive efficiency, an obvious conclusion is that the corporate governance of SCLCs has already jeopardized the adaptive efficiency of the Chinese economy. Further, the normative implication of this finding is that the refined art of reforming the corporate governance of SCLCs ought to combine and harmonize agency costs with adaptive efficiency.

Finding successors for private enterprises has become an urgent problem in recent years, partially because those firms’ owners lack trust in professional managers. Previous research on agents focuses on preventing opportunistic behavior and neglects the value of their entrepreneurship. In our research, professional managers’ credit is divided into three dimensions: personal credit, professional credit and operational credit. Using a sample of 379 firm owners from 27 provinces in China, we find that credit and its detailed dimensions are positively related to private owners’ trust in professional managers. We also found that a rigorous and effective credit identification mechanism positively moderate the above relationships. Furthermore, trust affects professional managers’ work performance in a positive way. Accordingly, we advise that (1) professional managers’ credit assessment system should be established and improved; (2) professional managers and enterprise owners should attach importance to enhancing professionalism and promoting rigorous credit identification mechanisms; (3) the closed-loop of the credit-trust psychologically interactive mechanism based on credit mechanisms and credit identification mechanisms should be put to use.

This study observes and explores a puzzle in Chinese firms whereby both cash holdings and short-term debt simultaneously account for more than 20% of total assets for at least two consecutive years over the sample period. This phenomenon conflicts with the principle of corporate value maximization, and is not clearly explained by the classical theories in corporate finance. Based on the implications in the extant literature and discussions of institutional constraints of the transition economy in China, this paper develops four hypotheses that are involved with agency conflicts between the largest shareholders and creditors and the formation of this puzzling financial structure. The empirical analyses suggest that the largest shareholders with tunneling motives seek to hold more cash to serve their private interests and/or the consequent operational deficit of the listed corporations. To the ends, these corporations tend to manage the timing of short term debt financing to increase cash reserves temporarily at the end of year. Essentially, greater cash holdings on the balance sheet of these corporations related with the puzzle become a misleading signal for potential creditors, possibly contributing to the refinancing of short-term debt of these listed firms for the following year. Hence, the puzzling financial structure is connected with the timing of debt financing and adverse selection of creditors. This study enriches the stream of literature on cash holdings and debt maturity, and provides new evidence on the impact of agency problems of the largest shareholders on the association between cash holdings and debt maturity in the context of a transition economy.

Everbright Securities Ltd. erroneously submitted huge quantities of buy orders on SSE180 constituent stocks from 11:05 through 11:07 on 16 August 2013. This fat finger accident had a pronounced impact on the Chinese stock markets. This paper uses the accident to study market quality and investors’ responses. We show that the Chinese stock markets were robust enough to stand the trial, exhibiting deep depths and strong resiliency. However, the markets performed poorly in terms of aggregating information because there were large price swings after the erroneous orders were executed. Moreover, investors quickly change their beliefs as to the reasons to the dramatic price jumps, consistent with information cascade theory.

In this paper we investigate the mechanisms underlying dynamic linkages between inward FDI and outward internationalization in the Chinese automotive industry. While several studies have examined the relationship between inward and outward FDI using empirical data, this is among the first to employ a case study approach to investigate how international joint ventures (IJVs) established between foreign and Chinese automakers can shape their internationalization motivation, degree, and speed. We discuss some unique features of Chinese carmakers with and without IJVs to elucidate how firms without IJVs will be more driven to expand internationally while firms with IJVs face constraints in venturing abroad.