Stable supply chain relationships are not only a fundamental guarantee for the smooth operation of micro-level transactions but also a crucial cornerstone for stable and healthy macroeconomic development. Against the backdrop of rising protectionism globally, disruptions in customer relationships have increasingly become a pressing issue for Chinese firms. Understanding how such disruptions affect systemic risk spillovers from supplier firms is of great practical significance for both corporate risk management and the maintenance of broader financial stability.
This study investigates the impact of supply chain relationship disruptions between suppliers and downstream customers on the systemic risk of Chinese supplier firms. Using FactSet Revere global supply chain data from 2010 to 2023 and firm-level measures of systemic risk spillover calculated based on stock return data, the empirical results show that supply chain disruptions significantly increase the systemic risk spillover of supplier firms. This finding remains robust after addressing endogeneity concerns and conducting multiple robustness tests. Mechanism analysis reveals that supply chain disruptions increase suppliers' systemic risk spillover through three channels, increasing suppliers' operational risk, reducing the trade credit they receive from downstream customers, and increasing suppliers' leverage ratio. Heterogeneity analysis reveals that this effect is more pronounced for firms producing more differentiated products, firms with fewer customers, relationships with shorter durations, firms in regions with lower levels of marketization, and under conditions of high trade policy uncertainty. Further analysis shows that the impact has a sustained effect over the first five periods following the disruption, while also revealing that increased R&D investment and stabilized investor sentiment can mitigate this effect.
This study makes three main contributions. Firstly, there is limited literature focusing on the contribution of real economy firms to systemic risk spillovers. This study investigates the impact of supply chain disruptions on systemic risk, thereby complementing this strand of literature. Secondly, existing studies on changes in supply chain relationships mainly use data on the top five suppliers or customers of listed companies. In contrast, this study uses comprehensive supply chain data from the FactSet Revere global supply chain database, enabling a more complete measurement of corporate supply chain stability. Thirdly, this study also complements the existing literature in terms of mechanisms and heterogeneity analyses. It helps explain how customer relationship disruptions affect suppliers' systemic risk spillovers and how these effects vary across different contexts.
Based on the conclusions, this paper proposes the following policy recommendations. For enterprises, it is necessary to expand diversified market channels and build a broader customer base to enhance overall operational resilience. In addition, enterprises should increase R&D investment to enhance their core competitiveness. For the government, it needs to take measures in several areas to reduce the systemic risk spillover,providing financial support for corporate R&D activities and operational stability, advancing high-standard institutional openness and reducing trade policy uncertainty, promoting domestic market integration, and guiding investor sentiment.

The spillover effects of the Federal Reserve monetary policy constitute a central issue in open-economy macroeconomics. Federal Reserve monetary tightening raises U.S. interest rates, triggering capital reallocation, tighter financing conditions, and output contraction, thereby increasing the risk of crises in other economies. Meanwhile, digital technologies are profoundly reshaping production, financial activities, and international trade. However, the existing literature has mainly examined monetary policy transmission from the perspective of traditional institutional factors, paying insufficient attention to whether the digital economy can mitigate the spillover effects of external monetary policy shocks.
To address this issue, this paper develops a small open economy New Keynesian model incorporating a digital economy sector and foreign sector. Data factors are incorporated into firms' production functions and embedded in the price adjustment mechanisms to theoretically explain how the digital economy affects the impact of external monetary policy shocks on exchange rates. Empirically, using panel data for 99 economies over the period 2013-2023, this paper constructs an Exchange Market Pressure（EMP）index to measure the risk of currency crises and examines the moderating role of the digital economy in the spillover effects of Federal Reserve monetary policy, together with its transmission channels and heterogeneous effects.
The results show that the Federal Reserve's monetary tightening significantly intensifies exchange-market pressure in other economies and increases the risk of currency crises. The digital economy significantly weakens these spillover effects by enhancing price elasticity, stabilizing output, and mitigating capital outflows, thereby reducing the risk of currency crises. This mitigating effect is more pronounced in economies with higher financial vulnerability and weaker institutional quality. In addition, expansionary fiscal policy weakens the mitigating effect of the digital economy, whereas contractionary monetary policy and macroprudential policy reinforce it. Among the different dimensions of the digital economy, digital infrastructure exhibits the strongest mitigating effect.
Based on the above findings, several policy implications are proposed. Firstly, governments should accelerate the development of digital infrastructure and fully exploit its role in mitigating external shocks. Secondly, differentiated digital economy development strategies should be adopted, with priority given to digital finance and digital regulatory systems in economies characterized by high financial vulnerability and poor institutional quality. Thirdly, enhanced coordination among monetary policy, fiscal policy, and macroprudential policy should be promoted to enhance the complementary effects between digital economy development and macroeconomic stabilization. Finally, policymakers should facilitate the deep integration of digital technologies with the real economy and the financial system to strengthen economic resilience and safeguard financial stability.
The marginal contributions of this study are threefold. Firstly, it incorporates the digital economy into the transmission framework of the Federal Reserve's monetary policy. Secondly, it builds a small open economy New Keynesian model to show how the digital economy absorbs external monetary shocks and stabilizes exchange rates. Thirdly, cross-country evidence confirms that the digital economy reduces currency crisis risks via price flexibility, output stability, and capital flows. These results enrich the literature on US monetary policy spillovers.

With the continuous advancement of the Belt and Road Initiative（BRI）, Chinese firms have expanded their outward foreign direct investment（OFDI）activities across countries with increasingly diverse economic and institutional environments. As host-country conditions become more heterogeneous, choosing an appropriate entry mode for firms has become an important strategic decision affecting investment efficiency and long-term competitiveness. Existing studies mainly explain OFDI entry mode choice from the perspectives of ownership-specific advantages, institutional distance and firm heterogeneity, while relatively limited attention has been paid to the differentiated role of host-country location advantages. Based on Dunning's OLI paradigm and the heterogeneous-firm framework proposed by Melitz（2003）and Helpman et al.（2004）, this paper constructs an analytical framework linking host-country location advantages to Chinese firms' OFDI entry mode choices. Using panel data on Chinese investment projects in 85 countries and regions during 2005 to 2023, this paper empirically examines how host-country location advantages influence firms' choices between greenfield investment and cross-border mergers and acquisitions（M&A）.
The empirical results show that hard location advantages significantly increase firms' preference for greenfield investment, whereas soft location advantages significantly promote cross-border M&A. Better infrastructure, industrial conditions and resource endowments reduce the cost of establishing new operations abroad, making greenfield investment more attractive. In contrast, improvements in institutional quality, governance effectiveness and market openness help firms reduce institutional adaptation costs and facilitate the integration of acquired resources, thereby encouraging cross-border acquisitions. These findings are consistent with the theoretical expectation that different dimensions of location advantages affect firms' entry mode choices through distinct mechanisms.
Further analysis indicates that hard location advantages exhibit significant nonlinear effects on firms' entry mode choices. As production conditions continue to improve, firms gradually shift from risk-oriented investment strategies toward efficiency-oriented greenfield investment. In contrast, the influence of soft location advantages is characterized by stage-dependent rather than nonlinear effects. Heterogeneity analysis further shows that the impacts of location advantages vary across regions and policy periods. Following the implementation of the Belt and Road Initiative, infrastructure connectivity further strengthened the positive effect of hard location advantages on greenfield investment, whereas the role of soft location advantages became relatively weaker. These findings suggest that Chinese firms continuously adjust their investment strategies in response to changing host-country conditions instead of relying on a fixed entry mode.
This paper enriches the literature on OFDI entry mode choice by incorporating multidimensional host-country location advantages into the analytical framework and provides new empirical evidence on how host-country characteristics shape Chinese firms' overseas investment decisions. The findings also provide useful policy implications for optimizing China's overseas investment layout, improving the quality of Belt and Road investment cooperation, and promoting high-quality outward foreign direct investment.

As China continues to strengthen its macroprudential regulatory framework, understanding how macroprudential policy is transmitted at the bank level has become increasingly important from both theoretical and practical perspectives. In the third quarter of 2016, the People's Bank of China began the process of incorporating off-balance-sheet wealth management products（WMPs）into the broad credit measure framework under the Macroprudential Assessment（MPA）. This change narrowed banks' scope for regulatory arbitrage through WMPs and placed tighter constraints on credit expansion through off-balance-sheet channels. It therefore provides a quasi-natural experiment for examining how macroprudential regulation affects banks' liability structures and how the resulting adjustments are subsequently transmitted.
Using semiannual panel data for Chinese commercial banks from the first half of 2011 to the second half of 2023, this paper employs a generalized difference-in-differences approach to examine banks' liability restructuring and its effects on risk-taking under macroprudential constraints. Specifically, the analysis considers how banks reallocate their funding sources after WMP expansion is constrained, whether the resulting liability adjustment raises funding costs across different funding markets, and how these changes subsequently affect asset allocation, risk-taking, and liquidity conditions.
The main findings are as follows. Firstly, the inclusion of WMPs in the MPA significantly altered the funding mix of banks with higher pre-policy dependence on WMPs, leading them to increase time deposits. Other liability instruments, however, exhibited no systematic changes in the same direction, indicating that time deposits were the primary channel through which banks responded to the regulatory constraint. Secondly, liability restructuring was accompanied by higher funding costs. Both the interest costs of corporate and retail time deposits and the interest rates on interbank negotiable certificates of deposit（NCDs）rose significantly among banks with greater WMP dependence. Thirdly, liability-side adjustments were further transmitted to the asset side. Risk-weighted asset growth, net interest margins, and net interest spreads increased in tandem, while credit expanded primarily in lower-risk industries. These results reveal a selective pattern of risk-taking characterized by aggregate expansion and structural optimization. Fourthly, the policy-induced increase in time deposits further improved banks' liquidity positions, as reflected in a significant rise in the liquidity coverage ratio. This finding points to synergies among macroprudential regulatory instruments.
This paper makes three contributions. Firstly, it extends the evaluation of macroprudential policy from the asset side to the liability side and identifies the mechanism through which banks adjust their liability structures in response to regulatory constraints. Secondly, it combines changes in risk-weighted assets with sectoral credit allocation to examine the aggregate and structural dimensions of bank risk-taking. Thirdly, it broadens the research perspective on coordination among macroprudential regulatory instruments and provides bank-level evidence that different regulatory requirements can generate positive synergies through adjustments in bank liabilities.

In recent years, the global financial cycle has experienced frequent fluctuations, affecting banks and promoting them to reallocate credit resources across borders, thus increasing the risk of extreme fluctuations in bilateral cross-border bank capital flows. Since bilateral bank capital flows decompose and provide a more detailed view of each country's aggregate flows, studying how the global cycle affects bilateral bank capital flows is important for China to monitor, assess and provide early warnings of such extreme volatility in bank capital.
This paper uses bilateral quarterly panel data from 23 source countries to 82 recipient countries over the period 2005-2021 to test the impact of the global financial cycle on extreme volatility in bilateral cross-border bank capital flow, and further explores the key roles of macroprudential policies and macro‑institutional environment from a clear bilateral view. The empirical findings reveal that extreme volatility in bilateral cross-border bank capital flow shows strong pro-cyclical traits relative to the global financial cycle. Specifically, the risk of a surge grows significantly during the expansionary phase of the global financial cycle, while the risk of a sudden stop rises markedly during the contractionary phase of the global financial cycle.
Further tests show that the procyclical effects of extreme volatility in bilateral cross-border bank capital flows display clear dynamic splits across different types of bilateral economies and also across varying ties of trade and investment deals. The global financial cycle can affect these extreme volatility through two primary paths. Firstly, by shifting source-country banks' exchange rate expectations regarding recipient countries. Secondly, by altering source-country banks' risk-taking behavior. Both of them jointly drive cross-border bank loans. In addition, tests on the key roles of bilateral macroprudential policies and macro‑institutional environment show that strict macroprudential policies in recipient countries can well curb the pro-cyclical volatility of extreme cross-border bank capital flows, while macroprudential policies in source countries tend to amplify this volatility, thus partly reducing the helpful effect of recipient-country rules. Yet, the effects differ much across many policy tools. Macro‑institutional environments of both sides also ease the pro-cyclical volatility, but due to the effect of the bilateral institutional gap, the effect of the recipient-country macro‑institutional environment becomes more pronounced when recipient countries have weaker institutions than source countries.
These findings have key theoretical and practical implications for China in preventing and controlling cross-border capital flow risks. Key policy takeaways derived from this study include the following, tracking the global financial cycle and its key transmission channels in real time, promoting the signing and upgrading of international trade and investment agreements to deepen ties; reinforcing macroprudential policies and optimizing macro‑institutional environment, enhancing bilateral policy alignment and institutional synergy, leveraging the key roles of both macroprudential policies and macro‑institutional environment to manage extreme capital volatility.

In the context of building a strong financial system and a modern central banking system, managing exchange rate expectations has become increasingly vital for maintaining financial stability. The People's Bank of China（PBOC）relies on communication as a key policy tool, with the quarterly Monetary Policy Implementation Report serving as the most authoritative and comprehensive channel. However, previous studies largely focus on the appreciation/depreciation bias of communication, overlooking the rich informational content embedded in the narrative. This paper aims to identify the theme structure of exchange rate communication in the Reports and examine the distinct information effects on expectation guidance.
Using the Latent Dirichlet Allocation（LDA）model on the Reports from the 2005 exchange rate regime reform to the second quarter of 2024, this paper discovers that the exchange rate‑related narratives cluster around two broad themes: market operations and exchange rate policy. The emphasis between these themes varies over time in response to domestic and external shocks. To quantify the information conveyed by each theme, this paper employs sentiment analysis based on a financial sentiment dictionary to measure the information content related to market operations, and a cosine similarity approach that accounts for accumulated prior communication to capture incremental policy information.
Using an EGARCH model with daily data on 1 to 12 month non‑deliverable forward（NDF）rates, this paper finds that both types of information significantly guide expectations towards RMB appreciation, with stronger effects on longer maturities. The mechanisms, however, differ markedly. Market operations communication boosts market confidence in the RMB and reduces exchange rate policy uncertainty, whereas policy communication, although reducing uncertainty, triggers risk-sensitive market sentiment—possibly because it signals underlying depreciation pressures. Furthermore, the effectiveness of these two channels is state‑dependent. After the“8·11”exchange rate reform in 2015, which enhanced the market determination of the RMB, the expectation guidance effect of market operations information strengthened, while that of policy information weakened. During periods of US Federal Reserve quantitative easing, characterized by abundant global liquidity and capital inflows, policy communication becomes more effective in guiding expectations, whereas market operations information loses some potency.
In addition, the results show that the semi‑annual Balance of Payments Report and oral communications play supplementary roles, but their lower frequency or information density limits their policy responsiveness. Robustness checks, including replacing NDF with deliverable forward rates, excluding the early reform period, and jointly estimating both information types, confirm the reliability of the findings. These findings make three contributions. Firstly, this paper moves beyond the unidimensional bias‑based approach and reveals the multi‑dimensional informational structure of exchange rate communication. Secondly, the differentiated mechanisms and state‑dependent effects provide actionable insights for the PBOC to tailor its communication narrative under different market conditions. Thirdly, the text‑based identification strategy adopted in this paper offers a transferable framework for studying the information effects of central bank communication in other policy domains.

Amid deepening global financial integration, the international transmission of US monetary policy has increasingly attracted attention. Based on non-financial corporate data from 101 countries between 2009 and 2023, this study employs the local projection method to reveal the spillover effects of the US monetary policy on firm-level investment. Furthermore, it pays particular attention to the moderating roles of the external asset-liability structure in emerging economies—specifically the size of the international investment position and the private sector's foreign currency debt exposure.
The findings indicate that US monetary policy tightening produces spillover effects on corporate investment in emerging economies primarily through the exchange rate channel and the risk appetite channel. On the one hand, US monetary policy tightening stimulates corporate investment in emerging markets through the exchange rate channel by improving export competitiveness. On the other hand, transmission through the risk appetite channel tightens corporate financing constraints, thereby inhibiting investment in emerging economies. Overall, combining the effects of both channels, owing to the enhanced international investment position of emerging economies and their declining dependence on foreign currency debt after the 2008 global financial crisis, the impact of US monetary policy tightening on emerging market firms has shown heterogeneous effects. It exhibits a“short-term neutral but long-term positive”effect: the impact remains insignificant at the early stage of monetary tightening but increases significantly at the later stages.
The marginal effect and heterogeneity analyses further clarify these moderating mechanisms. A larger net international investment position, which directly reflects national solvency, enables emerging economies to better mitigate the negative spillover shocks from US monetary policy tightening via the risk appetite channel. Meanwhile, lower private sector reliance on foreign currency debt can significantly diminish the additional debt pressure triggered by currency mismatches. This dampens the contractionary effect of the exchange-rate channel, thereby fully amplifying the exchange rate channel's export-expansion effect. China serves as a prominent example; its unique structure—characterized by a high net international investment position and a distinctly low private sector foreign currency debt exposure—has effectively buffered external shocks, demonstrating extremely strong micro-level corporate investment resilience.
These results strongly underscore the vital importance for emerging economies of continually optimizing their external balance sheet structures to effectively mitigate external shock transmission, enhance economic autonomy, and strengthen overall risk resistance. This study thus not only provides a novel perspective for gaining a deeper understanding of the micro-level global spillover effects of US monetary policy, but also offers clear empirical evidence and targeted policy implications for emerging economies to systematically improve their macroprudential policy frameworks and navigate global financial shocks.The optimization of international investment positions and reduction of foreign currency debt reliance form a critical micro-foundation for emerging economies to hedge against external shocks. Future efforts should focus on deepening macroprudential management of cross-border capital flows and coordinated home-foreign currency oversight, wherein China's institutional experience provides valuable insights for similar economies to build balance sheet resilience.

Eliminating capital barriers represents a key approach for establishing a unified, open, competitive, and orderly national market. Utilizing data on cross-regional investments from 4656 Chinese A-share listed companies spanning 2011 to 2023, this study develops a theoretical model linking digital finance and capital mobility. It examines the impact and underlying mechanisms of digital finance on the construction of a unified national market from the perspective of cross-regional enterprise capital flows.
The findings reveal that digital finance effectively promotes cross-regional capital flows and facilitates the development of a unified national market. These conclusions remain robust after a series of rigorous checks for robustness and endogeneity. Mechanism analysis shows that digital finance primarily fosters cross-regional capital mobility by reducing corporate transaction costs and alleviating financing constraints. Heterogeneity analysis further reveals that the effect of digital finance on cross-regional capital flows varies significantly by corporate ownership and industry characteristics. The promoting effect is more pronounced among non-state-owned enterprises and regulated industries, which typically face higher degrees of financing constraints and lower market transparency.
Furthermore, this study categorizes cities based on their economic development level, geographic region, and administrative rank to investigate whether digital finance development can mitigate the tendency of capital to excessively concentrate in economically advanced cities, central cities, and cities with higher administrative ranks, thereby facilitating more balanced cross-regional capital flows. The results demonstrate that digital finance encourages capital flows from more developed to less developed cities, from eastern to central and western regions, and from higher-to lower-ranked administrative areas.
Compared to existing research, the main contributions of this paper lie in in the following aspects. Firstly, most literature either explores the specific pathways to accelerate the construction of a unified national market through qualitative analysis or directly examines the economic effects of digital finance, with few studies focusing on the financial support elements involved in advancing the development of a unified national market. This paper systematically investigates the mechanisms through which digital finance drives regional capital flows and their directional trends, thereby broadening the scope of existing research. It holds significant strategic importance for unblocking the domestic economic circulation system and promoting balanced interregional flow opportunities. Secondly, this paper makes innovations on the theoretical model. Building upon the classical production function framework, this paper constructs a theoretical model linking digital finance and capital flows. It delves into the internal mechanisms through which digital finance supports the construction of a unified national market, primarily via financing costs and transaction costs, and further extends this analysis with empirical research. This approach not only enriches the academic perspective of this study with greater diversity and depth but also provides theoretical and empirical support for the government's strategic implementation of policies aimed at fostering a unified national market.