Does Rent-seeking Affect Environmental Regulation? Evidence from The Survey Data of Private Enterprises in China

Resource utilization not only meets the needs of economic development, but also has a far-reaching negative impact on the environment. Environmental regulation is regarded as the key measure to solve environmental pollution. However, the rent-seeking behavior of local enterprises will seriously weaken the implementation effect of environmental regulations. Under the background of the development of big data era, the massive micro enterprise data provided by China's private enterprise survey database provides favorable conditions for this paper to study its impact effect from the direction of big data. This paper uses OLS model and Tobit model to investigate the impact of rent-seeking on the implementation effect of environmental regulation. The results show that environmental regulation will make honest enterprises actively reduce output to control the emission level. However, rent-seeking enterprises will further expand their output to gain greater profits because they are sheltered by local governments.

RENT-SEEKING DECISIONS OF THE MAIN PARTICIPANTS IN CONSTRUCTION PROJECTS BASED ON EVOLUTIONARY-GAME AND SYSTEM DYNAMICS

The performance of a construction project can be severely harmed by its participants’ rent-seeking. In order to prevent such attempt, this research integrates the evolutionary game theory with system dynamics method to simulate the impact of the change of some factors that may cause/reduce rent-seeking. Based on the analysis of the behavioral characteristics and interactive relationships of the main participants (the owner, supervisor, and contractor), an evolutionary game model is constructed and simulated with the method of system dynamics based on the replication dynamic equation of the mixed strategy solution of the three-party static game model. By assigning the parameters of project scale, supervision likelihood, supervision success rate, supervision cost, and penalty intensity, the interaction mechanism of the participants on each factor is revealed through a case-based simulation. The results show that the impacts of these factors on participants’ rent-seeking decisions are significantly different. Furthermore, some management suggestions are provided to prevent rent-seeking for project owner according to the research conclusions. This research can help the project owners take proper measures to prevent rent-seeking of the supervisors and the contractors to improve the performances of the projects.

EVOLUTIONARY GAME ANALYSIS FOR RENT-SEEKING BEHAVIOR SUPERVISION OF MAJOR INFRASTRUCTURE PROJECTS BASED ON PROSPECT THEORY

Major infrastructure projects (MIPs) possess significant strategic positions in the national economy and social development. However, recently, the rent-seeking behavior between supervision units and project contractors has intensified in project construction. This paper aims to study the behavior decision-making of stakeholders in rent-seeking behavior supervision system of MIPs. In the complex and uncertain environment of MIPs, game players have cognitive bias and value perception preference. Therefore, this study introduced prospect theory and constructed the perceived return matrix and evolutionary game model of MIP rent-seeking behavior supervision among project owners, supervision units, and project contractors. From the perspective of risk perception theory, the reasons for the behavioral tendencies of game participants and the conditions for the steady state of strategy selection were explored through system dynamics simulations. The results showed that the stable state of the optimal strategy in the rent-seeking behavior supervision system of MIPs is related to the cognitive bias of the game players and is influenced by the level of regulation cost, the intensity of punishment and the size of accident losses. The contribution of this study lies in providing theoretical basis and decision support for constructing a long-term preventive mechanism for rent-seeking activities in MIPs.

Polong Renten: in Improving the Welfare of Employees of Village Owned Business Institutions (Bumdes) in Lombok Utara Regency

BUMDes development in North Lombok Regency is accelerating; practically all communities in North Lombok Regency now have BUMDes. Along with its development, BUMDes in the North Lombok district is experiencing a number of issues within the BUMDES institution itself, including concerns with its accreditation. (1) Each BUMDes performance has not been optimized; (2) A lack of a conducive business climate; (3) a lack of information and market access; (4) a lack of capital; and (5) a lack of entrepreneurial spirit and spirit among employees, all of which have an impact on the performance and welfare of BUMDes personnel. In order to improve BUMDes performance in North Lombok Regency. What must be done is to strengthen the importance of social capital. Until date, there has been a significant social capital in North Lombok Regency; the social capital in question is the rent-seeking system. Polong Renteng serve as recommendations for the community in terms of behavior, respecting one another among people, implementing a mutual cooperative living, and contributing to the people's lives in North Lombok Regency. If all organizational managers follow this advice, the organization's performance will improve. A literature review was chosen as the research method in this study. The findings revealed that the social capital of Polong Renteng played a significant influence in boosting the performance and welfare of BUMDes employees in the North Lombok district. This component of rent-seeking pod social capital serves as the social glue that holds the group together. With this broader component, the quality and quantity of BUMDes organizations/institutions (performance) can be improved, hence improving the welfare of BUMDes management. Furthermore, the existence of BUMDes in villages in the North Lombok region is often seen as successful and seamless since it has had a good impact on local communities. Implications for the development sector and community empowerment, particularly in building business abilities, boosting knowledge, skills, and attitudes that will lead to increased revenue. The establishment of BUMDes is capable of growing and nurturing an entrepreneurial spirit in rural communities, as well as instilling a sense of responsibility for policy.

Government subsidies, rent-seeking and corporate investment efficiency: Evidence from China

Despite a large number of government subsidies, Chinese listed companies still face numerous challenges. This requires research into the effects of government subsidies on corporate investment efficiency. The paper provides empirical evidence to investigate investment efficiency and enriches the study on the interactions between government intervention, rent-seeking, and ownership structure. Generalized least square (GLS) models with fixed effects were constructed using 2012–2020 data from 869 Chinese listed A-share non-financial firms. Results show that government subsidies received by listed companies significantly damage investment efficiency (β = .138, p < .01). This can be attributed to their rent-seeking behaviors to obtain subsidies, which also significantly harms investment efficiency (β = .915, p < .05). Government subsidies are also found to significantly mediate the impact of rent-seeking on investment efficiency. In three-step regression for testing mediating effect, coefficients are 0.475, 0.915, and 0.131 at the level of 1%, 5%, and 5%, respectively. Furthermore, ownership structure shows a moderating effect in the relationship between subsidies and investment efficiency. The management shareholding ratio significantly reinforces the negative impact (β = 1.369, p < .01), while the institutional shareholding ratio shows no significant moderating effect (β = 0.0571, p = n.s). Non-state-owned enterprises show a more significant negative impact (β = 0.17, p < .05) than state-owned enterprises (β = 0.148, p < .1). Finally, the study tests the above relationships for companies in the manufacturing industry that receive the most percentage of government subsidies in China, and the results are robust.

Security Regulation and Enterprise Innovation in Communication Industry

This paper conducted an evolutionary game model of the interaction between the governments and communication enterprises and analyzed the impact of the government’s communication security regulation on the innovation decision-making of communication enterprises. The results show that the behavior of the governments depends on the social benefits, rent-seeking benefits, and regulating costs in strict and de security regulations. The communication enterprises’ behavior depends on the benefits of innovation and the costs in R&D and rent-seeking. When government subsidies are relatively inadequate, the communication enterprises’ strategy under government security regulation swings from not-innovation finally to innovation. The policy implications of this study indicate that appropriate de security regulation by the government will help communication enterprises generate a good atmosphere for innovation, and the appropriate increase in subsidies will be more conducive to driving enterprise innovation.

How to Alleviate Rent-Seeking Behaviour in Performance Appraisal of Government-Paid PPP Projects? Tripartite Evolutionary Game Approach

Performance appraisal is a key link in the performance payment mechanism of government-paid Public-Private Partnership (PPP) projects. As the performance appraisal of PPP projects is highly professional and complex, it is usually necessary to introduce a third-party performance appraisal institution to evaluate the project outputs of the private investor. However, driven by economic rent, the private investor has the incentive to seek rent from the third party in the performance appraisal process, leading to the low overall performance level of PPP projects and the inability to achieve the PPP performance appraisal goal effectively. To explore how to avoid rent-seeking in performance appraisal and improve the overall performance of government-paid PPP projects, a tripartite evolutionary game model between the behaviour, third party, and the public sector has been constructed. Based on the evolutionary game model, this study analyses the evolutionary stability of each player's strategy, discusses the influence of various factors on the strategy selection of the three-party, and further analyses the stability of the equilibrium point of the three-party game system. The findings reveal that the public sector can slow down the rent-seeking behaviour of the private sector by setting up a reasonable reward and punishment mechanism. The design of a reasonable reward and punishment mechanism must meet the following conditions: (1) the sum of the reward and punishment of all parties is greater than the speculative income; (2) the amount of performance fee withheld for the private investor is greater than the difference between the project operating cost saved and the speculation cost. The research provides technical support for the design of the performance appraisal mechanism of government-paid PPP projects.