Internationalizing Like China

Christopher Clayton, Amanda Dos Santos, Matteo Maggiori and Jesse Schreger

American Economic Review, 2025, vol. 115, issue 3, 864-902

Abstract: We empirically characterize how China is internationalizing its bond market by staggering the entry of different types of foreign investors into its domestic market and propose a dynamic reputation model to explain this strategy. Our framework rationalizes China's strategy as trying to build credibility as a safe issuer while reducing the cost of capital flight. We use our framework to shed light on China's response to episodes of capital outflows.

JEL-codes: E44 F38 G12 G15 G23 O16 P34 (search for similar items in EconPapers)
Date: 2025
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Related works:
Working Paper: Internationalizing Like China (2023)
Working Paper: Internationalizing Like China (2022)
Working Paper: Internationalizing Like China (2022)
Working Paper: Internationalizing Like China (2022)
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DOI: 10.1257/aer.20221722

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