Lists with 'hanging labels': the list item is indented the amount of the hangIndent:

Item A:
Here is an example of a setence that follows the "hangText" in a list item in a hanging list.
Item B with a much longer label:
Here is an example if the text following the "hangText" is long and wraps, the indent (set to 8 in the XML) is used.
Item C:

Here's an example where a vspace element has been inserted so the text starts on a new line (instead of next to the "hangText".

And something which should look like a new paragraph for the same hangindent item.