Credit constraints and spillovers from foreign firms in China

Natasha Agarwal (), Chris Milner and Alejandro Riaño

Journal of Banking & Finance, 2014, vol. 48, issue C, 261-275

Abstract: This paper examines whether credit constraints affect Chinese firms’ absorption of productivity spillovers originating from the activity of foreign-owned firms. Using firm-level data for 2001–2005, we find evidence of positive spillovers originating from foreign-owned firms from countries other than Hong Kong, Macau and Taiwan for non-state owned Chinese firms operating in the same industry and province. Using an index of external finance dependence to measure credit constraints, we find that only non-state-owned firms operating in industries with external finance dependence below the index median exhibit significantly positive spillovers from the activity of foreign firms.

Keywords: Foreign direct investment; Knowledge spillovers; Credit constraints; China (search for similar items in EconPapers)
JEL-codes: F23 G31 O1 O33 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Credit Constraints and Spillovers from Foreign Firms in China (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:48:y:2014:i:c:p:261-275

DOI: 10.1016/j.jbankfin.2014.01.036

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