The Impact of Bank and Non-Bank Financial Institutions on Local Economic Growth in China

TILEC Discussion Paper No. 2006-009

Center Discussion Paper Series No. 2006-82

51 Pages Posted: 1 May 2006

See all articles by Xiaoqiang Cheng

Xiaoqiang Cheng

Hong Kong Monetary Authority

Hans Degryse

KU Leuven, Department Accounting, Finance and Insurance; Centre for Economic Policy Research (CEPR)

Date Written: April 10, 2006

Abstract

This paper provides evidence on the relationship between finance and growth in a fast growing country, such as China. Employing data of 27 Chinese provinces over the period 1995-2003, we study whether the financial development of two different types of institutions - banks and non-bank financial institutions - have a (significantly different) impact on local economic growth.Our findings indicate that only banking development shows a statistically significant and economically relevant impact on local economic growth.

Keywords: growth, financial development, Chinese provinces, banks

JEL Classification: E44, G21

Suggested Citation

Cheng, Xiaoqiang and Degryse, Hans, The Impact of Bank and Non-Bank Financial Institutions on Local Economic Growth in China (April 10, 2006). TILEC Discussion Paper No. 2006-009; Center Discussion Paper Series No. 2006-82. Available at SSRN: https://ssrn.com/abstract=899070 or http://dx.doi.org/10.2139/ssrn.899070

Xiaoqiang Cheng

Hong Kong Monetary Authority ( email )

3 Garden Road, 30th Floor
Hong Kong
Hong Kong

Hans Degryse (Contact Author)

KU Leuven, Department Accounting, Finance and Insurance ( email )

Naamsestraat 69
Leuven, B-3000
Belgium

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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