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

Xiaoqiang Cheng and Hans Degryse

LICOS Discussion Papers from LICOS - Centre for Institutions and Economic Performance, KU Leuven

Abstract: This paper shows that banking development spurs growth, even in a country with a high growth rate 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 show that banks outperform non-bank financial institutions. Only banking development exerts a statistically and economically significant positive impact on local economic growth. This effect becomes more pronounced when the financial sector is less concentrated.

Keywords: growth; financial development; Chinese provinces; banks (search for similar items in EconPapers)
JEL-codes: E44 G21 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2006
New Economics Papers: this item is included in nep-cba, nep-cna, nep-dev, nep-fin, nep-fmk, nep-mac, nep-sea and nep-tra
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Citations: View citations in EconPapers (14)

Downloads: (external link)
http://www.econ.kuleuven.be/licos/publications/dp/dp171.pdf

Related works:
Journal Article: The Impact of Bank and Non-Bank Financial Institutions on Local Economic Growth in China (2010)
Working Paper: The impact of banks and non-bank financial institutions on local economic growth in China (2007)
Working Paper: The Impact of Bank and Non-Bank Financial Institutions on Local Economic Growth in China (2006)
Working Paper: The Impact of Bank and Non-Bank Financial Institutions on Local Economic Growth in China (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:lic:licosd:17106

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