Credit Distribution and Exports: Microeconomic Evidence from China
Yao Li (),
Albert Park () and
Chen Zhao ()
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Chen Zhao: Department of Economics, Hong Kong University of Science and Technology
No 2015-31, HKUST IEMS Working Paper Series from HKUST Institute for Emerging Market Studies
This paper explores how the distribution of credit supply within an industry affects that industry's export intensity (the export-to-sales ratio) and export propensity (the ratio of the number of exporters to the total number of firms). Using a heterogeneous firm trade model, we derive two opposing hypotheses: for industries with relatively low (high) foreign market penetration costs, a more dispersed credit distribution decreases (increases) the industry's export intensity and the number of exporters. The empirical results using Chinese firm-level data and bank loan data support both hypotheses and confirm the significant heterogeneous impacts of credit distribution on exports across industries.
Keywords: credit constraints; credit supply; financial development; credit distribution; heterogeneous firms; international trade; liquidity (search for similar items in EconPapers)
JEL-codes: F14 G20 L60 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ban, nep-bec, nep-cna, nep-int and nep-tra
Date: 2015-11, Revised 2015-11
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Persistent link: https://EconPapers.repec.org/RePEc:hku:wpaper:201531
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