Generally, the maximization of tax revenue is incompatible with the maximization of Gross Domestic Product (GDP). Many economists would agree with the proposition that “high taxes are bad for economic growth” and use the tax multiplier to analyze this negative correlation frequently. But tax revenue and GDP of Hebei Province have achieved both developments since 1995 (the tax-sharing reform) and the tax elasticity has been more than 1 in the recent year. How to explain this contradiction from the point of the tax multiplier effect theory? It is important because of few previous studies on this topic, particularly in China, in which has to face a slowdown in economic growth. It will contribute to the development of knowledge in public taxation field. This paper analyzes the relationship between them in 1978-2011 by the simple and amended tax multiplier effect theory and the polynomial distributed lag (PDL) model. The results show that the negative impact of increase of tax revenue on economic growth may not be as serious as one might think and tax cuts would create more positive effects in Hebei Province. Moreover, the negative effect is lagging and more and more obvious. Tax reform of the current tax system should be reviewed and implemented.

The paper examines the impact of corruption on the share of government expenditure, related to the provision of public goods in health, education, and military sectors. The paper introduces a theoretical model that applies “the Samuelson rule of public good provision” to illuminate how corruption increases the cost of providing public goods and hypothetically leads to the underprovision of public goods in some specific sectors. The paper then provides an empirical investigation on how an increase in corruption can influentially mislead the share of government expenditure, focusing on 39 emerging market countries during the period of 1999 – 2010. The results suggest that corruption stimulates the expenditure share on military while lowering the share of spending in health and education. These results are significant and robust across a variety of specifications, and are consistent with the findings of previous studies.

The value creation of firms via engaging in better corporate social performance is an inconclusive area as well as is scarcely researched especially in the context of Japan. In this study, we examine whether the engagement in a higher degree of corporate social performance will reduce financial constraints. The findings show that overall, a higher degree of corporate social performance is negatively associated with financial constraints. The study also indicates that the financially distressed firms tend to engage in higher corporate social performance, and thereby lower their financial constraints. On the other hand, for the financially unconstrained firms, although we expected that engagement in a higher degree of corporate social performance does not reduce the investment-cash flow sensitivity, we find an unexpected negative relationship. This we attribute to the fact that such firms are faced with obtaining debt at higher costs, and therefore may need to rely on equity financing, which is more expensive or/and restrictive.

Offer price band is a crucial component of the book building process in the Initial Public Offering process of a firm. Extant research shows that investor sentiment plays a prominent role in IPO markets. We therefore suggest that investor sentiment plays a significant role in determining the offer price range. The determinants of offer price band have not been studied in the IPO literature. We fill this lacuna by studying the Indian IPO market. We hypothesise that investor sentiment will positively influence offer price band. We also posit that the profitability of a firm will be inversely related to the offer price band. Our empirical tests support these hypotheses.

Adopting a sample of the initial 243 IPOs from the emerging Growth Enterprise Market of China (GEMC) over the 2009 to 2011 period, this study develops a regression model to investigate the relationships between these factors and suggests that the firm’s net profit and its growth rate substantively determine the IPO volume. In addition, this study adopts probit models to test the influence of the four factors on IPO likelihood, and shows that: 1) fundraising amount, as one of the most significant IPO determinants, is positively associated with IPO probability on the new listing market; 2) the net profit, as a fundamental IPO determinant, is positively associated with IPO probability, but also with other indicators, which demonstrates the fact that the GEMC is a profit-preferring listing venue; 3) the net assets determine IPO probability but not IPO volume on the market.