Suwina Cheng

Public policies, tobacco taxes and tobacco consumption: evidence from Hong Kong

This paper examines the impact of statutory policies on the prevalence of smoking in Hong Kong from 1982 to 2010. Different public policy interventions, including tobacco excise duties, bans on tobacco advertising and restrictions of public smoking, are reviewed and their separate and combined effects are empirically measured. The results confirm that increasing the price of tobacco products through taxation is the most effective tool for reducing tobacco consumption. Moreover, the Hong Kong Government’s comprehensive ban on tobacco advertising and restrictions on public smoking had a significant and negative impact on smoking prevalence, while the influences of individual policy interventions are less obvious. These results suggest that a comprehensive tobacco control programme is an effective means of reducing tobacco consumption.

A city-level analysis of the distribution of FDI within China

Purpose - The study examines whether city-level investment climate, local government effectiveness and corporate income tax rates influence the spatial distribution of foreign direct investment (FDI) across cities in China. Design/methodology/approach - The study employs regression analysis using city-level datasets. Findings - The study finds that while city-level investment climate and effective local government influence the spatial distribution of FDI across Chinese cities, city-level tax rates have no such influence. Practical implications - The results have implications for the design of policies aimed at enhancing FDI flows into emerging countries. Originality/value - To date, few studies have investigated the investment location choice at the city level in a single country. The study contributes to the literature by examining the role of government in such investment decisions. It also adds to the previously limited research examining the role of investment climate at the micro level.

Corporate Social Responsibility and Tax Reporting Aggressiveness in a Transition Economy

This paper examines the relationship between corporate social responsibility (CSR) and corporate tax in an environment where we expect this relation to be affected by the degree of market and institutional developments. Taking advantage of substantial crossregional variations in institutions in China, we find that in regions with a lower level of institutional development, firms claiming to act socially responsible engage more in aggressive tax reporting, consistent with the stockholder view of corporate social responsibility (CSR). In contrast, we find that in institutionally stronger regions, corporate social responsibility is more aligned with the social responsibility aspect of tax compliance, which supports the stakeholder view of CSR. Our results suggest that absent institutional infrastructures, CSR as corporate practice risks to become seen as nothing more than window-dressing.

A study of the incidence and independence of nomination committees

The purpose of this study is to understand the factors influencing the adoption and independence of nomination committees. Previous literature identifies potential substitutability and complementarity between corporate governance arrangements that may be beneficial from the perspective of outsiders (e.g., Rediker and Seth, 1995), but our work suggests that similar complementarities may be identified from the perspective of firm insiders. Probit analysis of data from the annual reports of UK public companies from 1998 through 2002 reveals that the shareholdings of substantial shareholders are positively related to the selection of non-executive members to the nomination committee, but that these shareholdings are negatively related to the use of nomination committees in the first place. Coupled with the participation of over 40% of UK CEOs on the appointment committees of their own firms, these results suggest that some appointment committees are used to limit the influence of substantial shareholders on future board appointments.

The impact of the high technology crisis on CEO compensation

The paper empirically examines CEO compensation in 125 UK high technology firms in an attempt to identify and understand any changes in the pay system evident after the global technology market correction in 2000. We find evidence that link between executive pay and market returns weakened and that the fixed component of executive pay in these companies rose post-adjustment. These changes appear to compensate executives for the increased risk associated with variable pay rather than rectify any perceived problems with executive incentives pre-2000.