Purpose: This paper aims to review the theory and empirical evidence of institutional investor behavioral biases in the lenses of behavioral finance paradigm. It surveys the research specifically focusing on behavioral biases among institutional investors in investment management activities worldwide.Design/methodology/approach: A literature survey is done to gather and synthesize evidence on behavioral biases of institutional investors.Findings: The survey and analysis reveal the following findings. First, the theoretical underpinning of investors’ irrational behavior has been neglected in behavioral finance research. Second, the behavioral heuristics and biases are dynamic and complex. Third, understanding behavioral biases’ origin, causes and effects requires interdisciplinary perspectives from the fields of psychology, sociology and biology.Originality/value: The analysis and alternative perspectives drawn in this paper provide new insights into the field of behavioral finance and aims to suggest researchers, practitioners and regulators on the next course of actions.

ESG ratings are closely linked to corporate resource allocation and overarching macroeconomic constituents. Nevertheless, there is a noticeable lack in the literature investigating the interconnected relationship between the growth of local government debt, corporate underinvestment, and ESG ratings. This study aims to investigate the impact of local government debt on corporate underinvestment and its subsequent effects on corporate ESG performance. To achieve this goal, this study utilizes special bond data from Chinese provinces spanning the period between 2015 and 2021. The findings suggest that as local government debt swells, it imposes financing constraints on local companies, leading to underinvestment, particularly for listed companies with a high proportion of fixed assets and non-state-owned enterprises. A key effect is a “crowding-out effect” in which local government debt absorbs resources that could otherwise be allocated to private corporations and non-investment sectors. This trend illuminates the concealed costs of a debt-reliant growth model extending beyond the financial sector to impact broader corporate behavior and ESG performance. Our research suggests that government debt, corporate financing constraints, and ESG investment are intimately linked. The study concludes with policy implications and recommendations aimed at mitigating the investment gap in Chinese enterprises and promoting sustainable economic growth.

This research focuses on Chinese listed companies to explore the influence of green-oriented strategies and green innovation on corporate productivity. Using empirical data from 2011 to 2022, the study investigates the positive effects of executives’ green perceptions on new quality productivity and the enhancing role of green innovation. The results indicate that executives’ green perceptions significantly enhance new quality productivity. Furthermore, heterogeneity analyses reveal variations in this effect based on firm size, type, and pollution levels, demonstrating the environmental sensitivity of green strategies. Robustness tests reinforce the consistency of these results. Additionally, the research establishes that green innovation not only directly boosts new quality productivity but also strengthens the positive influence of executive green perceptions on productivity. These insights emphasize the critical synergy between green innovation and executive commitment to sustainability as a means to boost productivity, offering valuable guidance for policymakers and business leaders aiming to advance corporate productivity through sustainable practices.