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Lending for Growth? An Analysis of State-Owned Banks in China

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  • Andersson, Fredrik N. G.

    ()
    (Department of Economics, Lund University)

  • Burzynska, Katarzyna

    ()
    (Department of Economics, Lund University)

  • Opper, Sonja

    ()
    (Department of Economics, Lund University)

Abstract

This paper provides the first comparative analysis of different types of publicly owned banks operating in China between 1997 and 2008. Using principal component analysis and Granger-causality tests, this study shows that China’s state-owned commercial banks and rural credit cooperatives did not promote GDP growth during the observation period. State-owned commercial banks even had a negative effect on growth in the manufacturing sector. By contrast, state policy banks and joint stock commercial banks did promote domestic growth. China’s experience presents a more nuanced picture of state banking that goes beyond the role of ownership to consider functional and institutional differences.

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Bibliographic Info

Paper provided by Lund University, Department of Economics in its series Working Papers with number 2013:19.

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Length: 42 pages
Date of creation: 17 Jun 2013
Date of revision:
Handle: RePEc:hhs:lunewp:2013_019

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Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/en
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Keywords: China; Banking sector; Economic growth;

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