Economic integration and the circulation of Hong Kong dollars in Southern China

As the economies of Hong Kong and southern China have in recent years become more closely integrated, the phenomenon of currency substitution has gained in importance. This article provides both theoretical and empirical analyses of the circulation of Hong Kong dollars in Mainland China. The observed phenomenon of currency substitution is first explained from both macro- and microeconomic perspectives. The empirical study then estimates the quantity of Hong Kong dollars circulating in southern China over the last fifteen years. Regression analysis indicates that the growth rate of Hong Kong's foreign direct investment in China, as well as the growth rate of trade between Hong Kong and China, and the difference in real returns between Hong Kong dollar denominated assets and Chinese renminbi denominated assets are some of the main determinants that have contributed to the widespread circulation of Hong Kong dollars in southern China     

The Effect of Tax and Expenditure Limitations on Revenue Volatility: Evidence from Colorado

Much of the research on tax and expenditure limitations (TELs) focuses on the impact that limits have on the size of the public sector or the distribution of expenditures at the state and local levels. While these results shed light on the extent to which TELs succeed in reducing government spending, they do not have much to say about the impact of TELs on government budgeting or financial planning, despite the fact that voters support TELs in the hope of reducing government inefficiency (Courant, Gramlich, and Rubinfeld 1980; Ladd and Wilson 1982). This paper examines the effect of TELs on the stability of government revenues; sound tax policy entails controlling the volatility of revenues in order to plan more effectively for the future. Using panel data from Colorado's Division of Local Government as well as the Census Bureau's Annual Survey of State and Local Government Finances, this paper examines the impact of Colorado's 1992 Taxpayer's Bill of Rights (TABOR) on local government finances. Results from difference‐in‐difference estimation suggest that TELs increase revenue and expenditure volatility.     

Neutralization and Tax Evasion: How Effective Would a Moral Appeal Be in Improving Compliance to Tax Laws?

The failure of individuals to pay their taxes in full is a serious budgetary problem for the federal government. Existing research (Schwartz and Orleans, 1967; Grasmick and Scott, 1982) suggests that efforts to increase the guilt feelings experienced for tax evasion might improve compliance. However, neutralization theory (Sykes and Matza, 1957) predicts that guilt feelings can be reduced by neutralization strategies which justify guilt-producing behavior, compromising the inhibiting effect of guilt feelings. Our research shows that through the use of neutralization strategies which justify tax evasion the inhibiting effect of guilt feelings is sharply reduced. The implications of this finding for tax compliance programs based on appeals to the moral obligation of paying taxes are discussed.     

Chinese Diaspora as a Virtual Nation: Interactive Roles between Economic and Social Capital

This paper attempts to analyse how and in what ways the Chinese diaspora interacts with globalisation in Southeast Asia through their economic and social capital. It explores the theories of globalisation and contrasts them with the thematic changes of Southeast Asia studies, and it conceptualises the economic power, the geographical dispersal nature and the social networking of Chinese diaspora in order to understand how a virtual nation is being constructed. It then examines empirical studies of that economic power using the specific case of Indonesia; comparative studies of Chinese companies in Southeast Asian countries; and foreign direct investment in China from the Association of Southeast Asian Nations. Finally, it surveys the building of the virtual community through ethnicity, languages, associations and Confucianism, from which social capital has been generated among the Chinese diaspora in Southeast Asia.     

Jean-Marc F. Blanchard and Kun-Chin Lin,eds., Governance,Domestic Change,and Social Policy in China: 100 Years After the Xinhai Revolution

Journal of Chinese Political Science -     

Self-Control,Social Factors,and Delinquency: A Test of The General Theory of Crime Among Adolescents in Hong Kong

The objectives of this study were to test the predictive power of self-control theory for delinquency in a Chinese context, and to explore if social factors as predicted in social bonding theory, differential association theory, general strain theory, and labeling theory have effects on delinquency in the presence of self-control. Self-report data were collected from 1,015 Chinese secondary school students (463 boys and 552 girls) in Hong Kong aged between 14 and 19. Bivariate results showed that low self-control is correlated with delinquency in the Chinese setting. We also found that low self-control is linked to a range of negative social conditions in Chinese adolescents, including disrupted social bonds, delinquent association, deviant definition, educational under-achievement, coercive parenting, negative school experiences, negative relations with peers, stressful life events, and labeling by parents and teachers. However, contrary to self-control theory and many previous studies based on Western samples, self-control fails to predict delinquency when social variables are controlled for among Chinese adolescents. The effects of social factors on delinquency remain significant net of self-control. This suggests that it is the combination of self-control and social factors in the prediction of delinquency that might be variant across cultures. These findings from adolescents from Hong Kong only partially support the culture-free thesis of self-control theory. The implications of Chinese cultural forces on the influence of self-control merit closer attention.

Kharis Templeman,Yun-han Chu,and Larry Diamond,eds., Dynamics of Democracy in Taiwan: The Ma Ying-jeou Years

Journal of Chinese Political Science -     

INSTITUTIONAL REFORM IN ENVIRONMENTAL GOVERNANCE SYSTEM OF THE PEOPLE'S REPUBLIC OF CHINA: Service Organizations as an Alternative for Administrative Enhancement

The economic reform in the PRC inaugurated by Deng Xiaoping in 1979 has changed the landscape of the regime's environmental governance by putting it in a more market‐oriented context. As a strategy to strengthen administrative capacity in a situation heavily circumscribed by the limited resource support from local governments, the environmental protection authorities at all levels have established a sizable number of service organizations to provide them administrative support. These service organizations have to sponsor their own operation by engaging in revenue‐generating or fund raising activities. This has led to the emergence and proliferation of service organizations in the environmental governance system in the last decade. This article will examine, from a state capacity perspective, institutional reform in the environmental governance system of the PRC¹.