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AbstractIn the pre-Qin era, thexianneng賢能 [those of virtue and talent] were a commonly discussed topic, on which every school of thought had its own views. Daoist discussions on thexiannengsometimes reflected strong aversion and rejection, yet at other times gave them abundant praise and approval. Because of uncertainty on the universality of moral principles, on the limitations of one's individual ability, and on the effectiveness of political actions, views in theLaozi老子 and theZhuangzi莊子 on thexiannengsaving society were skeptical in nature, sometimes even taking a mocking tone. Scholars of the Huang-Lao tradition had realized the limitations of individual ability and hoped that the greatest level of political benefit could be attained. Consequently, under the premise of safeguarding monarchical authority, fully displaying the skills and talents of all kinds of sages (imperial teachers and virtuous officials) through the practice ofwuwei無為 [inaction], and the highest leaders' respect for virtue became the main direction in the Huang-Lao understanding of thexianneng. This tendency has much in common with the Legalist school of thought.

Confucius' explanation of the "rectification of names" is not necessarily related to the theories of "social status" and "names and actuality." The reason scholars have interpreted the rectification of names in the Analects in so many different ways is, to a large degree, due to assumptions about Confucius' thinking by his successors, and based on the views on rectification of names among later generations. In the course of the development of thinking about names, scholars have augmented Confucius' own explanation, gradually fleshing it out from an empty shell into a substantial edifice. The original meaning may have been very simple: Confucius did not wish to establish a standard system of names. Rather, he was simply the first person in history to realize the importance of language in politics. As a politician, Confucius noticed and foresaw the influence that the indeterminacy, ambiguity, and arbitrariness of names could have on politics. He discerned the political consequences when language could not accurately express meaning or when there was no way for people to accurately perceive it. He also recognized how names, as a way of clarifying right and wrong and establishing norms, could have a great effect on a society's politics. Although Confucius noted that disunity in speech could lead to disunity in politics, he did not propose a solution.

AbstractManuscript TypeEmpiricalResearch Question/IssueOn April 2005, the China Securities Regulatory Commission (CSRC) launched the split‐share structure reform to mitigate principal–principal agency problems. Using the reform as an exogenous shock, we examine the impact of principal–principal agency problems on stock price crash risk. Specifically, this study attempts to answer two questions: (1) Does the split‐share structure reform in China decrease stock price crash risk? (2) Is the above effect induced by the mitigation of principal–principal agency problems?Research Findings/InsightsWe find that the reform induces a significant decrease in crash risk after controlling for other predictors of crash risk, and this effect is more pronounced in firms with a higher proportion of shares held by controlling shareholders. Moreover, we find that the negative impact of the reform on stock price crash risk is more pronounced in firms with a high level of tunneling prior to the reform, which indicates that reform induces less tunneling, and adversely affects crash risk.Theoretical/Academic ImplicationsThis study contributes to the literature in two ways. First, this study constitutes the first effort to explore the determinants of stock price crash risk from the perspective of principal–principal agency problems. Second, this study enriches the growing literature on the economic consequences of the split‐share structure reform in China.Practitioner/Policy ImplicationsWe draw two important implications from our results. First, our findings highlight that regulatory intervention is an important way to enhance corporate governance. This is particularly beneficial in China, a transitional economy which may lag in terms of general protection of investors and information disclosure. Second, this study also confirms that minority shareholders and listed firms benefit from the reform. Both are crucial to the healthy development of the capital market in China.