Bank Efficiency and Regional Economic Growth: Evidence from China
Hong Zhuang (),
Miao Wang and
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Hong Zhuang: Judd Leighton School of Business and Economics, Indiana University South Bend
Haiyan Yin: Judd Leighton School of Business and Economics, Indiana University South Bend
Miao Wang: Department of Economics, College of Business Administration, Marquette University
Jiawen Yang: Department of International Business, George Washington University
Annals of Economics and Finance, 2019, vol. 20, issue 2, 661-689
This paper examines for the first time the relationship between bank efficiency and regional economic growth in China with provincial data over 1995 - 2014. We find consistent and strong evidence that bank efficiency positively affects regional economic growth. Further, bank efficiency exerts a more pronounced impact on economic growth in inland provinces than coastal regions. The insignificant effect of the quantity of credit in our regressions suggests that a mere expansion of financial volume is not effective in promoting regional economic growth, whereas the improvement in the quality of financial intermediation plays an important role in fostering provincial economic growth.
Keywords: Bank efficiency; Financial development; Regional growth; China (search for similar items in EconPapers)
JEL-codes: G21 O16 O47 O53 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:cuf:journl:y:2019:v:20:i:2:zhuangyinwangyang
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