SOE preference and credit misallocation: A model and some evidence from China
Mohan Zhou and
Yi Zhou ()
Economics Letters, 2016, vol. 138, issue C, 38-41
We endogenize credit misallocation by introducing the government’s preference. The local government determines the credit subsidy to SOEs after a trade-off between SOEs’ profits and local aggregate outputs. Credit misallocation is more severe in regions where SOE share is high.
Keywords: State-owned enterprises; Credit misallocation; Local government; China (search for similar items in EconPapers)
JEL-codes: O43 O53 H25 (search for similar items in EconPapers)
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