Assessing the Impact of the Chinese Stimulus Package at Home and Abroad: A Damp Squib?

109 Pages Posted: 4 Feb 2015

See all articles by Richard C. K. Burdekin

Richard C. K. Burdekin

Claremont McKenna College - Robert Day School of Economics and Finance

Marc Weidenmier

Claremont McKenna College - Robert Day School of Economics and Finance; National Bureau of Economic Research (NBER)

Date Written: January 25, 2015

Abstract

The November 2008 Chinese stimulus package seemed to provide almost ideal preconditions for governmental success based upon its size, its concentration on infrastructure, accompanying fiscal expansion at the local level, and supportive expansions in bank lending rates. Our sectoral-level analysis suggests that investor reactions were quite tightly focused, however, with Shanghai market outperformance concentrated primarily in the nation's property, construction, and building materials sectors. Further significant post-stimulus gains accrued to the specifically targeted automobile, steel and textile industries. Meanwhile, Chinese company listings in Hong Kong and New York evinced little sectoral outperformance.

Keywords: Stimulus package; China; Stock market reactions; Shanghai; Hong Kong; New York

JEL Classification: G15; E65

Suggested Citation

Burdekin, Richard C. K. and Weidenmier, Marc D., Assessing the Impact of the Chinese Stimulus Package at Home and Abroad: A Damp Squib? (January 25, 2015). China Economic Review, Forthcoming, Claremont McKenna College Robert Day School of Economics and Finance Research Paper , Available at SSRN: https://ssrn.com/abstract=2559942

Richard C. K. Burdekin (Contact Author)

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth Street
Claremont, CA 91711
United States

Marc D. Weidenmier

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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