Could Financial Distortions be no Impediment to Economic Growth After All? Evidence from China

Guariglia, A.; Poncet, S.

doi:10.1016/j.jce.2007.12.003

Could Financial Distortions be no Impediment to Economic Growth After All? Evidence from China

Guariglia, A.; Poncet, S.

Authors

A. Guariglia

S. Poncet

Abstract

Using data for 30 Chinese provinces over the period 1989–2003, this study examines the relationship between finance, and real GDP, capital, and total factor productivity growth. We find that traditionally used indicators of financial development and China-specific indicators measuring the level of state interventionism in finance are generally negatively associated with growth and its sources, while indicators measuring the degree of market driven financing in the economy are positively associated with them. These effects have been gradually declining over time, and are weaker for high FDI recipients, suggesting that FDI may be used to alleviate the costs associated with the inefficient banking sector.

Citation

Guariglia, A., & Poncet, S. (2008). Could Financial Distortions be no Impediment to Economic Growth After All? Evidence from China. Journal of Comparative Economics, 36(4), 633-657. https://doi.org/10.1016/j.jce.2007.12.003

Journal Article Type	Article
Publication Date	Dec 1, 2008
Deposit Date	May 22, 2009
Publicly Available Date	Jun 9, 2009
Journal	Journal of Comparative Economics
Print ISSN	0147-5967
Electronic ISSN	1095-7227
Publisher	Elsevier
Peer Reviewed	Peer Reviewed
Volume	36
Issue	4
Pages	633-657
DOI	https://doi.org/10.1016/j.jce.2007.12.003
Keywords	Financial development, Financial distortions, Economic growth, Capital accumulation, Productivity growth, China.
Public URL	https://durham-repository.worktribe.com/output/1559336