Volume 26, Issue 3, May 2022

Special Issue on China

China may soon become the world’s largest economy, but most academic research in top journals is based on USA and European data. The insights from these papers with western perspectives may not necessarily apply to China, given its unique set of institutional features. At the same time, many aspects of the Chinese economy are shared by other developing as well as developed countries, such as potential conflicts of interest between majority and minority shareholders, the prevalence of state ownership, and the intricate interactions between market mechanisms and policy interventions. Therefore, the insights from “China” papers, which typically take advantage of unique institutional settings in China, could be of great value to countries far beyond China, independent of whether the research is aimed at certain general economic questions or explores China-specific economic and social issues.

The Review of Finance, thanks to the initiative and support of managing editor Alex Edmans, launched a Special Issue on China in 2020. We are honored to serve as editors for this special issue, which covers all aspects of financial economics in China, including asset pricing, capital markets, financial intermediation, and corporate finance. Among more than 200 submissions, we aimed to publish papers that meet the following ordered criteria: (a) papers that are high-quality academic work; (b) papers that inform readers about the first-order issues of contemporary Chinese financial markets; and (c) papers that highlight interesting institutional features with clear connections to questions about which western readers care.

The first Special Issue on China includes eight excellent papers that aced the above criteria. We received so many high-quality submissions that satisfied the three criteria that we will publish a second Special Issue on China, likely in 2023 as some papers are still in the final stages of the editorial process. We look forward to introducing those papers then.

Below we present the digests for the current issue.

Mortgage Debt, Hand-to-Mouth Households, and Monetary Policy Transmission
Sumit Agarwal, Yongheng Deng, Quanlin Gu, Jia He, Wenlan Qian, Yuan Ren
Review of Finance, Volume 26, Issue 3, May 2022, Pages 487–520, https://doi.org/10.1093/rof/rfac011

Investor Attention and Asset Pricing Anomalies
Lei Jiang, Jinyu Liu, Lin Peng, Baolian Wang
Review of Finance, Volume 26, Issue 3, May 2022, Pages 563–593, https://doi.org/10.1093/rof/rfab032

Do Place-Based Policies Promote Local Innovation and Entrepreneurship?
Xuan Tian, Jiajie Xu
Review of Finance, Volume 26, Issue 3, May 2022, Pages 595–635, https://doi.org/10.1093/rof/rfab029

How Do Individual Politicians Affect Privatization? Evidence from China
Hong Ru, Kunru Zou
Review of Finance, Volume 26, Issue 3, May 2022, Pages 637–672, https://doi.org/10.1093/rof/rfab030

Finance Leases: In the Shadow of Banks
Jeffery (Jinfan) Chang, Ting Yang, Yanping Shi
Review of Finance, Volume 26, Issue 3, May 2022, Pages 721–749, https://doi.org/10.1093/rof/rfab037

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