Abstract
Using city-level data over 1989-1991, we find relatively clear evidence that China's bank loans favor state-owned industrial enterprises. Using a simple model, we argue that the lending bias diminishes the effectiveness of other measures designed to promote the growth of non-state sectors or to induce SOEs to restructure. A policy implication of the study is that the reform of the banking sector, in particular, its lending policy should be implemented simultaneously with the reforms of state-owned industrial enterprises.
| Original language | English |
|---|---|
| Pages (from-to) | 19-29 |
| Number of pages | 11 |
| Journal | China Economic Review |
| Volume | 8 |
| Issue number | 1 |
| DOIs | |
| Publication status | Published - 1997 |
Bibliographical note
Funding Information:We thank James Guanzhong Wen and Chuyuan Cheng for helpful discussions. Wei acknowledgesf inancial support from Harvard University’s William Milton Fund. The authors,n ot any other individual or institution, are responsiblef or the views and errors in the paper.
Funding
We thank James Guanzhong Wen and Chuyuan Cheng for helpful discussions. Wei acknowledgesf inancial support from Harvard University’s William Milton Fund. The authors,n ot any other individual or institution, are responsiblef or the views and errors in the paper.
| Funders | Funder number |
|---|---|
| Harvard University’s William Milton Fund |
ASJC Scopus Subject Areas
- Finance
- Economics and Econometrics