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This paper investigates the spatial concentration of Chinese manufacturing using data collected in both the second and third national industrial censuses. It is found that many of China's manufacturing industries were highly geographically concentrated in several coastal regions in 1995. A historical comparison of the concentration levels between 1980, 1985 and 1995 suggests that manufacturing industries have become more geographically concentrated following the economic reform. An econometric analysis further supports new economic geography theory and reveals that China appeared to be on the upside of the upside down U curve. D

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Due to the highly skewed and heavy-tailed distributions associated with the insurance claims process, we evaluate the Rubinstein-Leland (RL) model for its ability to improve the cost of equity estimates of insurance companies because of its distribution-free feature. Our analyses show that there is as large as a 94-basis-point difference in the estimated cost of insurance equity between the RL model and the capital asset pricing model (CAPM) for the sample of property-liability insurers with more severe departures from normality. In addition, consistent with our hypotheses, significant differences in the market risk estimates are found for insurers with return distributions that are asymmetrically distributed, and for small insurers. Third, we find significant performance improvements from using the RL model by showing smaller values of excess return of the expected return of the portfolio to the model return for a portfolio of insurers with returns that are more skewed and for a portfolio of small insurers. Finally, our panel data analysis shows the differences in the market risk estimates are significantly influenced by firm size, degree of leverage, and degree of asymmetry. The implication is that insurers should use the RL model rather than the CAPM to estimate its cost of capital if the insurer is small (assets size is less than $2,291 million), and/or its returns are not symmetrical (the value of skewness is greater than 0.509 or less than - 0.509). Copyright The Journal of Risk and Insurance, 2008.