Xiao Shanyun

Abstract： China’s regulatory tolerance of financial innovations brought not only rapid growth and unprecedented development opportunities to the internet finance sector but also triggered unexpected financial risks and legal li- abilities. In its first attempt to regulate internet finance， the Chinese government“crossed the river by feeling stones，”moving gradually toward intervention. However， the existing literature has not adequately investigated how internet finance enterprises have responded to tightening regulation. This paper evaluates the effectiveness of China’s experimental regulatory approach to internet finance， drawing empirical evidence from the law enforce- ment and corporate innovation data of listed internet finance companies from 2012-2018. The difference-indifferences results indicate that the number of lawsuits and patent applications significantly increased with tight- ening regulations， indicating that the experimental legislative governance of internet finance has gradually been accepted and digested by the market. These regulations are enforced in judicial practice and stimulate healthy competition in patent applications.

Keywords： internet finance； effective regulatory pattern； tightening regulation； empirical legal study； differencein-differences

CLC：D 922， F 272DC：AArticle ID：2096-9783（2022）01-0127-13

1 Introduction

Chinese scholars have first defined China’s internet finance as the“Internet-based technologies， such as mo- bile payments， social networks， search engines， and cloud computation， will lead to a paradigm shift in the financial sector.[1]”Internet finance has developed rapidly in China since 2012， with digital platforms and convenient online shopping enabling Chinese people to skip credit cards entirely and enter a cashless payment society based on trust and credit. As a breakthrough in financial technology （Fintech）， internet finance has promoted the revolutionary transformation of China’s financial reform and brought tremendous profit opportunities and capital liberalization[2]. It offers a variety of financial services to the general public， which includes online payment （Alipay， Wechat Payment， QQ Wallet）， online lending （Renrendai）， crowdfunding （JD Finance）， online insurance （ZhongAn Online Property In- surance）， wealth management （Yu’E Bao， WePay） and other areas. Every coin has two sides； the country’s wide- spread growth in internet finance also poses unpredictable challenges and legal risks to consumers and financial sta- bility. As a part of“finance”in the traditional sense， internet finance also owns equivalent characteristics of com- mon financial risks. While the very term Internet has， to some extent， allowed internet finance to circumvent conven- tional financial regulation， resulting in potential threats， legal loopholes， and inconsistencies with the existing finan- cial system[3].

Although China embraces the civil law system， no specific law can cope with all the regulatory hazards arising from the new industry. Even within the scope of Chinese Criminal Law， common crimes related to internet finance are limited to the“establishment of financial institutions without approval， fraudulent fundraising， illegally absorp- tion of public deposits， illegally issuance of public securities， financial fraud， and money laundering.[4]”The tradi- tional regulatory instruments of the laws and criminal justice system have struggled to keep up with changes in the Fintech sector[5]. Most academic scholars view internet finance regulation positively necessary： Financial regulation lags behind the rapid proliferation of internet finance due to the unclear business scope and legal boundaries[6]. Pre- liminary classification may result in higher financial risks and legal liabilities， which should be strictly regulated to exert its deterrent effect[7]. However， some scholars disagree： nonintervention regulation seems to equip financial in- novation with more development freedom， but it is not feasible in China’s internet finance because market players are not self-disciplined enough in market access， operation and customer protection， and the“invisible hand”is far from reaching market equilibrium at this stage[8].

Because of its distinct national conditions， China had few examples of regulatory experience in the Fintech sec- tors. There are four main RegTech approaches observed from the global practices： （1） doing nothing （restrictive or permissive approach）； （2） flexibility and forbearance （existing rules are relaxed）； （3） restricted experimentation （sand- boxes or piloting）； and （4） regulatory development （new regulations are developed to cover new activities and en- trants）[9]. In particular， China’s internet finance regulation is not limited to one pattern， as China has experimented with diverse regulatory approaches. China has tried a variety of regulatory models to find the most appropriate way to mitigate the financial risks of internet finance. Several regulatory modes can be classified according to the vari- ous development stages of the internet finance industry. For example， the“innovative regulatory pattern”（licensing） is applied to the sectors of online payment and online insurance；“strictly forbidden mode”is used to equity-based crowdfunding； the“campaign-style governance pattern”（developing first and regulating later） is applied to online P2P lending， and the“regulatory sandbox pattern”is applied to blockchain finance[10].

As a socialist market economy， China has few successful past practices from which to learn， and it cannot en- tirely rely on foreign experiences. It must establish its regulatory pattern with Chinese characteristics to cope with the legal risks arising from this new industry. In other words， China must“cross the river by feeling the stone，”a practice that has yielded good progress in the formulation of the Food Safety Law and seems a reasonable approach to regulating internet finance by adhering to the principles of“step-by-step gradualism， exploration， and experi- mentation.[11]”This may be termed an“experimental regulatory pattern，”Many rules and laws“from different levels in the administrative system”are implemented to determine which ones work best for the emerging industry[12]. Spe- cifically， instead of banning internet finance from the start， it leaves ample room for growth until legal risks emerge， with the government stepping in to implement a series of regulatory rules that address the deficiencies of the exist- ing legal system[13]. China has striven to issue regulations， norms， and other regulatory documents from various ad- ministrative departments， adopting a complex regulatory strategy to address legal loopholes in the internet finance industry and restore financial stability.

Little attention has been paid to the extent of the experimental regulatory pattern of internet finance， and it re- mains to be seen whether this pattern promotes innovation while preserving financial stability. This paper contrib- utes to existing scholarship by evaluating the effectiveness of how China’s internet finance sector responded to the experimental regulatory pattern， based on the empirical evidence of Chinese listed internet finance firms from 2012 to 2018. The difference-in-differences （DID） findings indicate that regulating internet finance positively impacts lit- igation & arbitration number and patent applications. It indicates the regulatory model has achieved initial success by efficiently implementing regulations and stimulating enterprises’ enthusiasm for innovation. The market partici- pants’ awareness of legal and property rights protection constantly improves.

The remaining framework of this paper goes on as follows： Part 2 introduces the laissez-faire stage to the regu- latory intervention stage of China’s internet finance. Part 3 investigates the legal framework and critical measures in regulating internet finance. Drawing from existing literature， part 4 develops law enforcement and corporate inno- vation hypotheses. Part 5 applies the difference-in-differences approach in analyzing the effectiveness of the experi- mental regulatory pattern. Part 6 ends the paper with a conclusion.

2 Internet Finance Regulatory Policies

China’s“trial-and-error”or“development first/regulation later”approach in the Fintech fields has provided sufficient freedom and space for economic growth and innovation while preventing problems and risks from getting out of control[14]. However， special loopholes still exist because the“absence of thoughtful top-level design”throws enforcement into chaos and requires repeated fixes[15].

2.1 Laissez-Faire Stage

The year 2013 was considered the starting point of the development era of internet finance[16]. This emerging fi- nancial innovation has brought unprecedented profits to the financial market. Therefore， the government was more inclined to pursue an open and inclusive policy without excessive regulatory intervention： the“l(fā)aissez-faire”ap- proach was adopted， leaving enough space for financial innovation. After a year of experimentation， the 2014 Gov- ernment Agenda first acknowledged the indispensable role of internet finance in promoting the current financial market， stating that：“we will promote the healthy development of internet finance.[17]”Motivated by preferential pol- icies， internet finance has risen dramatically to prominence. Viewing such gratifying achievements， the 2015 Gov- ernment Agenda fully affirmed the status of internet finance again， which noted，“we will encourage the healthy de- velopment of…internet finance， and to guide internet-based companies to increase their presence in the interna- tional market.[18]”

2.2 Regulatory Intervention Stage

The hands-off growth mode of financial innovation has simultaneously triggered systematic risks to economic stability[19]. The Supreme People’s Court （SPC） revealed that more than 152，000 internet finance cases or disputes had been settled from 2013-2017[20]. Given the limited self-healing capacity of the market to restore equilibrium， the Chinese government intervened with a“visible hand”to prevent potential market failure[21]. Until mid-2015， in response to legal challenges brought by internet finance， the previously non-interfering policy structure was tight- ened， and a series of experimental regulatory measures were implemented to fix the fragmentation and inadequacy of regulation[22].

On 18 July 2015， ten departmental regulatory authorities jointly issued the“Guiding Opinions on Promoting the Sound Development of Internet Finance [2015]”， implying that China’s internet finance had stepped into a com- prehensive regulation stage， and the era of nonintervention had come to an end[23]. Meanwhile， to balance financial regulation and financial innovation，“moderately easy regulatory policies”were particularly stressed to“l(fā)eave cer- tain leeway and space for the innovation.[24]”Safety， stability， and compliance have become the mainstream of Chi- na’s financial innovation regulation.“We will work to see that internet finance develops in line with regulations”was written in the 2016 Government Agenda to prevent legal risks occurring from financial innovation[25]. Afterward， 2017 was considered the“toughest year”for China’s financial market， as regulations almost covered every aspect of internet finance[26]. As an emerging financial industry， the government has taken stricter measures， vowing in the 2017 Government Agenda that“we must be fully alert to the buildup of risks， including risks related to non-per- forming assets， bond defaults， shadow banking， and internet finance.[27]”The regulatory measures advocated by the 2018 Government Agenda were slightly different from the previous ones， which emphasize the external supervision while also calling for more robust internal control on financial risks，“we will strengthen overall coordination system of financial regulation on shadow banking， internet finance.[28]”

3 Current Internet Finance Regulatory Framework

3.1 Overview of China’s Mechanism of Internet Finance Regulation

Ex-post regulatory remedies are enacted to control emerging legal risks to restore order to the internet finan- cial market. Guiding Opinions on Promoting the Sound Development of Internet Finance [2015] （2015 Guiding Opinions） marked the beginning of China’s internet finance regulation， which was“the precursory regulatory at- tempt to lay down a regulatory blueprint.[29]”These guiding opinions stressed that China’s internet finance was en- tering a phase of comprehensive regulation， with“separated regulation”as its key feature. As Table 1 categorizes， China accelerated establishing a stringent regulatory framework for financial innovation， special measures include： set up higher standards of entry threshold， issuing licenses and permits， restricting business scopes and interest rates， imposing administrative fines， and other criteria.

After then， more than 20 departmental regulatory documents or rules have continued to take effect in place of official laws. Some regulations are still on trial implementation. Most regulations are promulgated by the People’s Bank of China （PBOC）， China Securities Regulatory Commission （CSRC）， and other administrative organs， rather than the official legislature： National People’s Congress （NPC） and its Standing Committee[30]. This phenomenon re-flects that to satisfy the needs of rapid social and economic development； China has adopted the“experimental leg- islation”pattern， that is，“a legislative trial of a particular reform approach and the effectiveness of rules.[31]”If this experimental regulatory pattern works well in China， the main regulatory ideas could be considered for formal legis- lation. As a result， regulation can incrementally keep pace with the rapid development of financial innovation and even restore financial stability when legal risks arise. However， if this model proves ineffective， there is flexibility to abolish it without too much adverse effect， leaving room to try another new regulatory approach.

3.2 Key Measures of Internet Finance Regulation

3.2.1 Limits on Business Access

Initially， there were few competitors in the internet finance market， so internet finance firms held dominant re- sources， offered an inelastic supply， and earned enormous profits thanks to strong demand[32]. Fearing that such firms would become dominating monopolies that challenged the traditional banking system， the PBOC restricted the entry of non-bank third-party financial institutions by issuing Payment-Business Permits[33]. Regulators adjust the barriers to entry based on regulatory standards rather than blindly encouraging new technologies without regard to quality and safety. After the 2015 Guiding Opinion was promulgated， the PBOC slowed the pace of issuance. More importantly， the central bank canceled the first batch of unqualified licenses， Zhejiang Yishi Enterprise， for breach- es of payment-business license rules[34]. Moreover， the Office of the Leading Group for the Special Campaign against Internet Financial Risks decided to stop approving the online micro-lending business permits on 21 Novem- ber 2017[35]. The business access threshold is much higher than before.

3.2.2 Limits on Interest Rates

The government has tried to mitigate financial risks by capping interest rates， with the Supreme People’s Court（SPC） setting an interest rate line on lending in 2015. The regulatory rule provides that“where the interest rate agreed on by the borrower and the lender exceeds 36% of the annual interest rate， the agreement on the excess part of the interest shall be invalid.[36]”In terms of lending， 25 online lending platforms had set recommended interest rates of more than 36% in 2013-2014. Some even reached 90%； after the regulation came into effect， most compa- nies performed poorly； worse still， 24% suspended business for rectification[37].

Both the lending rates and the deposit rates of online payment platforms were restricted. For example， the aver- age annualized deposit return rate of Yu’E Bao （a famous online payment platform） had been above 6% earlier， far higher than the 0.36% interest rate offered by commercial banks[38]. Motivated by this high return， people may have withdrawn their money from banks and deposited it with Yu’E Bao， posing a threat to the traditional banking sys- tem. The authorities gradually became aware of the systemic risks posed by the nonintervention policy， so the PBOC put pressure on the deposit rates of non-bank platforms and required them to reserve funds under central management to prevent misappropriation[39].

3.2.3 Limits on Cross-Sectoral Operation

Cross-industry operation is typical in internet finance， which integrates multiple businesses into one platform to obtain more profits. The riskiest example is P2P online lending， which generally uses precipitation funds for un- authorized activities such as financing， insurance， or trust products. Although the vigorous development of cross-in- dustry operation brought substantial profit， it also triggered legal challenges to the financial system， such as“dou- ble or multiple leverages， risk concentration…conflicts of interests， non-transparency of the legal and managerial structure.[40]”

Failure to manage risks across sectors properly could create a regulatory vacuum and inhibit financial develop- ment. Thus， Chinese financial laws require that banking， security， and insurance sectors not cooperate in a hybrid model but should operate and supervise separately. Besides， the 2015 Guiding Opinion also pointed out that“on- line lending institutions shall not provide credit enhancement services or conduct illegal fundraising， shall not set up a pool of funds， shall not grant loans， and shall not provide guarantee for itself”； and“financial institutions and non-bank payment institutions should not operate in any way related to ICO financing and trade.”This principle was strictly enforced again as per Article 10 of Interim Measures for the Administration of the Business Activities of Online Lending Information Intermediary Institutions [2016]， which prohibits online lending institutions from in- vesting in or holding a position in another financial sector to operate across sectors. In the long run， restrictions on cross-industry operation will limit the business scope of Internet financial enterprises， thus restraining the profit margins.

3.2.4 A Heavy Burden of Compliance

According to criminology， imposing penalties such as fines on enterprises is an effective regulatory interven- tion that can quickly reduce legal risks and restore financial stability[41]. When the costs of penalties and probability of detection outweigh the benefits of violations， this penalty can trigger a deterrence effect and lead to an“efficient system of law enforcement.[42]”Administrative fines and regulatory penalties would then be in place.

In late 2018， the PBOC fined Ant Financial Services 4.12 million RMB， Union Mobile Financial Technology 26.4 million RMB， and Gopay 46.4 million RMB for breaches of online payment rules[43]. The heavy compliance burden makes internet finance firms think twice before taking action， especially in fear of violating regulatory rules.

4 Development of Hypotheses

There is a heated discussion in the existing literature on the impact of regulation on law enforcement and inno- vation. Whether these theories apply to internet finance regulation has yet to be tested.

4.1 Internet Finance Regulation and Enforcement

There are three enforcement principles in the financial service regulation：“prevention，”“information，”and“deterrence”[44]. Ideally， efficient regulatory enforcement can optimize the overall industry continuously by eliminat- ing substandard institutions and squeezing surplus impurities. These principles can also apply to the law enforce- ment evaluation of China’s internet finance regulation.

In the highly competitive internet finance market， internet finance firms often profit from regulatory arbitrage[45]. Enforcement is essential， as stricter supervision will eliminate nonstandard platforms and unreasonable services at their first emergence and prevent the risk of crimes and illegal behavior， thus restoring financial stability. The effec- tiveness of law enforcement relative to the experimental regulatory pattern of internet finance is worth empirical test- ing. Judging from the existing literature， regulating the internet finance sector is expected to enhance enforcement efforts， as litigation and arbitration rates may increase as legal awareness increases. Thus， the first hypothesis is that：

H1： Regulating internet finance has a positive impact on law enforcement.

4.2 Internet Finance Regulation and Innovation

According to the agency theory， innovation is a risky corporate activity that requires prime time， expertise， money， and a high tolerance of failure[46]. Directors or managers are often“more risk-averse and cautious than the shareholders”because they are concerned about their reputation， performance， and the next contract renewal[47]. It will be understandable if the directors or managers prefer to extract surplus value from existing products and servic- es rather than investing in an unpredictable innovation. But suppose the decision-making of the directors or manag- ers leads to a successful exploration of a new patented invention. In that case， their efforts will enhance the corpo- rate reputation， bring huge returns， and even accelerate technological advancement in the long term[48]. Supported by the empirical evidence from 2003 to 2009 among 101 Chinese commercial banks， there was a significant posi- tive relationship between risks and bank efficiency in highly concentrated markets； in other words， higher chances could lead to higher rewards[49]. An empirical study using the instrumental variable approach indicates that change in venture capital policy in 1979 has significantly increased the number of patented inventions in the United States[50]. Therefore， the Chinese government often calls for innovation in developing internet finance.

Innovation efficiency determines the survival of internet companies. Whether regulation can keep up with fi- nancial and technological innovation is an essential indicator of adequate financial supervision[51]. It is worth investi- gating what effect an experimental regulatory pattern has on innovation because， as an emerging field， internet fi- nance will create many inventions and patents when innovative ideas emerge. Thus， the second hypothesis is put forward：

H2： Regulating internet finance has a positive impact on corporate innovation.

5 Research Methodology snd Empirical Implication

5.1 Data and Source

Scholars frequently use patents and patent citations as variables measuring corporate innovation[52]. Besides， the number and value of litigation and arbitration cases are used to evaluate law enforcement or compliance[53]. The data used in this paper is from the CSMAR database and Genius Finance database from 2012-2018. Table 2 sum- marizes the definition and sources of the indicators used in this paper.

5.2 Model Design

This paper examines the inferred causal links between internet finance regulation and law enforcement and corporate innovation to determine whether an exogenous legal shock has had an effect； therefore， the difference-indifferences （DID） methodology is used to estimate the treatment effect by comparing the treatment group and con- trol group before and after the legal shock at the end of 2015， when internet finance regulation took effect[54].

Due to the information disclosure requirement， the data of listed companies is easier to obtain and is more complete than the private companies. The sample of this paper will be all Chinese listed companies. The samples of the treatment group in this paper are Chinese listed“internet finance （hu lian wang jin rong）”companies collect-ed from the concept stocks （gai nian gu） of the Genius Finance database. In comparison， the control group samples refer to the“mobile internet （yi dong hu lian wang）”. As both groups come from the internet industry， it was expect- ed that they would have much in common and foreshadow a parallel trend for the DID presupposition test.

The models mentioned above are expected to explain the market reaction of the regulatory intervention in the internet finance industry. If the results can witness a dramatic“difference”of the samples which break the parallel trend after the legal shock， then this“difference”can be attributed to explain the influence of the cut-off point.

5.3 Descriptive Statistics

Table 4 demonstrates the descriptive statistics from 2012-2018， which collects internet finance listed compa- nies’ available enforcement and corporate innovation data. According to the Genius Finance database statistics， 127 internet finance listed companies and 89 mobile internet firms hit the target.

As Table 4 indicates， the listed internet finance companies were willing to apply for patents. The average of this variable is approximately 13， but the most significant number was over 3000， suggesting that different compa- nies adopted diverse strategies in innovation. Since the regulation took effect， the numbers for litigation and arbitra- tion are also relatively high among these companies.

These up-and-coming financial innovators are young， ranging from 3 to 37 years. Some are start-ups， and some have transitioned from traditional high-tech internet companies or simply expanded their scope of operation. Typically， they are characterized by low leverage and a large scale and market value. Some make a good profit， but others suffer losses due to uncertain high risks.

5.4 Effectiveness of the Experimental Regulatory Pattern of Internet Finance

The empirical question to be addressed is whether the experimental practice of internet finance regulation is applicable and persists in China.

5.4.1. Basic Results

As can be observed in Figure 1， the presupposition of the DID approach is satisfied and valid， as the measur- ing variables of the treatment group and control group had already demonstrated the parallel trend before the exoge- nous law change on 31 December 2015. Furthermore， the variable of Ln（1+Patent Applications） shows a significant difference after the legal shock at the end of 2015， while Ln（1+LA Number） does not reflect a noticeable differ- ence， remaining parallel all the way.

Table 5 provides the basic DID results of the dependent variables regarding enforcement and innovation. Mod- el （1） does not control the firm and year-fixed effects， whereas model （2） does.

Table 5 shows that the number of litigation & arbitration cases increased significantly after regulation inter- vened. The results remain robust even when adding firm and year fixed effects， which means that the number of in- volved litigation & arbitration cases increased significantly after the regulation came into effect. This demonstrates that internet finance’s regulatory rules and norms are necessary legal provisions and are also tried in judicial pro- ceedings. The regulations are not empty talk； they are strictly enforced on the contrary. Violations of internet fi- nance regulation may be executed through litigation or arbitration， which provide evidence of the emerging under- standing， recognition， and familiarity with the incremental experimental regulation pattern in China’s internet fi-nance sector.

The DID results in Table 5 also show a positive increase in patent applications after the regulatory interven- tion. However， it reaches only the one-star significance level， indicating that the number of patent applications surged after the internet finance regulation came into effect. This finding suggests that the regulation did not sup- press enthusiasm for innovation but stimulated firms’ passion for applying for more patents. The regulation restrict- ed the operation of some internet finance firms in specific industries and other aspects， so their profit margin was reduced， as previous activities that were now illegal could not continue. To seek new alternatives， internet finance firms quickly adjusted their strategies and strove to apply for patents for squatting， hoping to seize the market op- portunity to obtain profits. In Chinese practice， even though internet finance firms are very active in applying for patents， the granting authorities （mainly the National Intellectual Property Administration） will not take the risks of approving the patent applications quickly. Perhaps unsatisfactory， non-innovative， or illegal applications are reject- ed after a substantive examination， out of concern for quality control. The responsibility of granting patents is to is- sue patent certificates， more importantly， and protect the actual intellectual property from infringement[56]. Addition- ally， those who lag in filing a patent do not enjoy“l(fā)egal priority”or the“exclusive rights to the disclosed inven- tion”due to the“first-to-file”rule[57]. In this context， internet finance firms’ awareness of intellectual property pro- tection has to some extent enhanced their competitive strength. Successfully filing a patent prevents rivals from in- fringing on their property rights via copying and thus reducing their profit margin. Moreover， the research and devel- opment expenses and related costs they have invested in can be recouped and converted into products. Therefore， internet finance companies are actively applying for patents earlier to secure the grant.

5.4.2. Robustness Checks

To conduct further robustness checks of the DID models， more control variables are added to models （3） and（4） in response to models （1） and （2）. Table 6 shows the results of the robustness checks of the dependent variables regarding enforcement and innovation. After adding more control variables， the results remain unchanged from the primary DID results； they are significantly positive， proving robust DID results. The results demonstrate again that internet finance regulation has caused a significant increase in the number of patent applications and litigation and arbitration cases.

The result of the DID proves to some extent that the gradual experimental regulatory mode affords market par- ticipants the preparation time to digest the tightening regulation and adjust their business strategies rather than be- ing abruptly forced to respond to legal changes. When the market is familiar with rules and laws in internet fi- nance， it is easier for participants to improve their legal awareness， protect themselves in the case of disputes， and safeguard their intellectual property rights. To be sure， the imposition of harsh punishments by the authorities may be a quick way to contain a financial crisis. Still， self-awareness in respecting laws and protecting property rights can go further. In this regard， the regulation pattern in China can mitigate further financial risks and legal liabili- ties， thanks to the self-discipline of market participants.

Interestingly， return on asset （ROA） has a significant negative association with the number of litigation & arbi- tration cases. The more litigation and arbitration that internet finance firms face， the less they will earn， as they must accept added expenses and effort to comply with the new rules. Tightening regulation will gradually bring in- ternet finance back to the fold of traditional finance regulation； firms will earn less or even suffer losses compared to what they experienced in the laissez-faire phase. Thus， ROA will drop accordingly as companies face challenges raising money for business operations and investment. This does not imply that the negative impact on firm profit- ability is necessarily a bad thing； it is possible that eliminating unqualified platforms or irregularities in the short term will restore financial stability. It also suggests that the regulation has triggered deterrence effects； when the firms can no longer profit from illegal behaviors or crimes， they will hardly risk danger in desperation.

Moreover， the number of patent applications is significantly positively correlated with the log of R&D spend- ing. This finding aligns with the expectation that the more resources internet finance companies devote to R&D， the more patents they are expected to apply and obtain[58].

6 Conclusion

This paper examined listed Chinese internet finance enterprises to determine whether they have complied with regulations and have generated innovations under the experimental regulatory pattern of internet finance in China. Based on panel data from 2012 to 2018， the quantitative findings of the difference-in-differences approach indi- cate that regulating internet finance had significant positive effects on law enforcement and corporate innovation， as measured by the number of patent applications and a number of litigation and arbitration. These findings strengthen confidence in China’s implementing an experimental regulatory pattern of internet finance by proving that （1） law enforcement is effective； regulation is not merely a code of conduct for reference but is strictly obeyed by internet fi- nance firms， and this can play its role in reducing illegal behaviors and promoting a healthy financial order； and （2） the enthusiasm for innovation has not been undermined by strict regulation； instead， regulation spurred competition among internet finance companies to file patent applications for their inventions.

China’s experimental regulatory pattern in internet finance contributes to rebuilding the financial order when chaos occurs， especially considering that the country had few examples of advanced financial practice in the virtual internet environment. As one of the pioneers in developing internet finance and Fintech， China’s experimental regu- latory experience can serve as a reference for the rest of the world. Its main difference from other countries or re- gions is that China does not ban emerging industries at the outset but adopts an exploratory approach. China reaps the rewards while correcting unexpected mistakes. Crossing the river by feeling stones made this initial accomplish- ment possible， but further mature regulation is expected.

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摸著石頭過河：探索中國互聯(lián)網(wǎng)金融的有效監(jiān)管模式

肖善允

（香港城市大學法律學院，香港999077）

摘要：中國對金融創(chuàng)新的監(jiān)管寬容給互聯(lián)網(wǎng)金融行業(yè)帶來了快速增長和前所未有的發(fā)展機遇，也引發(fā)了難以預(yù)見的金融風險和法律責任。第一次著手監(jiān)管互聯(lián)網(wǎng)金融，中國政府摸著石頭過河，逐步走向干預(yù)。以往的文獻在關(guān)于互聯(lián)網(wǎng)金融企業(yè)如何應(yīng)對日益嚴格的監(jiān)管方面討論得還不夠充分。文章主要以2012—2018年互聯(lián)網(wǎng)金融上市公司的執(zhí)法和創(chuàng)新的數(shù)據(jù)為實證證據(jù)，對我國互聯(lián)網(wǎng)金融實驗式監(jiān)管模式進行有效性評價。雙重差分的實證結(jié)果表明，當監(jiān)管收緊時，訴訟數(shù)量和專利申請數(shù)量有顯著增加。由此可見，互聯(lián)網(wǎng)金融監(jiān)管的實驗式治理模式逐漸被市場所接受和消化。這些監(jiān)管規(guī)則在司法實踐中得以實施，并激發(fā)了專利申請中的良性競爭。

關(guān)鍵詞：互聯(lián)網(wǎng)金融；有效監(jiān)管模式；加緊監(jiān)管；法學實證研究；雙重差分