How Much Has Private Credit Lending Reacted to Monetary Policy in China? The Case of Wenzhou
AbstractThis study investigates empirically what the major factors are which have driven Wenzhouâ€™s informal credit market and how much that market is responsive to monetary policies and the formal banking conditions nationwide. The main findings are: (i) the informal credit lending rates are highly receptive to monetary policies; (ii) the market is dominantly demand driven; (iii) the informal lending is substitutive to bank savings in the short run but complementary to banking lending in the long run; and (iv) the market is complementary to excessive investments in the local real estate market.
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Bibliographic InfoPaper provided by Department of Economics, SOAS, University of London, UK in its series Working Papers with number 178.
Date of creation: Feb 2013
Date of revision:
informal credit market; monetary policy;
Find related papers by JEL classification:
- G19 - Financial Economics - - General Financial Markets - - - Other
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-03-16 (All new papers)
- NEP-CBA-2013-03-16 (Central Banking)
- NEP-IUE-2013-03-16 (Informal & Underground Economics)
- NEP-MON-2013-03-16 (Monetary Economics)
- NEP-TRA-2013-03-16 (Transition Economics)
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