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Deconstructing China’s and India’s Growth: The Role of Financial Policies

  • Jahangir Aziz
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    This paper uses the standard one-sector neoclassical growth model to investigate why China’s consumption has been low and investment high. This paper looks into the role played by the financial sector in the growth process of China and India. [WP No. 224].

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    Paper provided by eSocialSciences in its series Working Papers with number id:1714.

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    Date of creation: Oct 2008
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    Handle: RePEc:ess:wpaper:id:1714
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    1. Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2008. "Formal versus informal finance : evidence from China," Policy Research Working Paper Series 4465, The World Bank.
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    4. Beck, Thorsten & Levine, Ross & Loayza, Norman, 2000. "Finance and the sources of growth," Journal of Financial Economics, Elsevier, vol. 58(1-2), pages 261-300.
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    7. Barry Bosworth & Susan M. Collins & Arvind Virmani, 2006. "Sources of Growth in the Indian Economy," India Policy Forum, Global Economy and Development Program, The Brookings Institution, vol. 3(1), pages 1-69.
    8. Edward C. Prescott, 1997. "Needed: a theory of total factor productivity," Staff Report 242, Federal Reserve Bank of Minneapolis.
    9. V. V. Chari & Patrick J. Kehoe & Ellen R. McGrattan, 2006. "Business cycle accounting," Staff Report 328, Federal Reserve Bank of Minneapolis.
    10. Jahangir Aziz & Li Cui, 2007. "Explaining China’s Low Consumption; The Neglected Role of Household Income," IMF Working Papers 07/181, International Monetary Fund.
    11. Jahangir Aziz, 2006. "Rebalancing China’s Economy; What Does Growth Theory Tell Us?," IMF Working Papers 06/291, International Monetary Fund.
    12. Steven A Barnett & Ray Brooks, 2006. "What’s Driving Investment in China?," IMF Working Papers 06/265, International Monetary Fund.
    13. Barry Bosworth & Susan M. Collins, 2008. "Accounting for Growth: Comparing China and India," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 45-66, Winter.
    14. Singh, Ajit, 1997. "Financial Liberalisation, Stockmarkets and Economic Development," Economic Journal, Royal Economic Society, vol. 107(442), pages 771-82, May.
    15. Stewart C. Myers & Nicholas S. Majluf, 1984. "Corporate Financing and Investment Decisions When Firms Have InformationThat Investors Do Not Have," NBER Working Papers 1396, National Bureau of Economic Research, Inc.
    16. Myers, Stewart C. & Majluf, Nicholas S., 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Journal of Financial Economics, Elsevier, vol. 13(2), pages 187-221, June.
    17. Richard Podpiera, 2006. "Progress in China’s Banking Sector Reform; Has Bank Behavior Changed?," IMF Working Papers 06/71, International Monetary Fund.
    18. Gregory C. Chow, 1993. "Capital Formation and Economic Growth in China," The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 809-842.
    19. Mauro, Paolo, 1995. "Stock markets and growth: A brief caveat on precautionary savings," Economics Letters, Elsevier, vol. 47(1), pages 111-116, January.
    20. Patrick J. Kehoe & Ellen R. McGrattan, 2002. "Accounting for the Great Depression," American Economic Review, American Economic Association, vol. 92(2), pages 22-27, May.
    21. Franco Modigliani & Shi Larry Cao, 2004. "The Chinese Saving Puzzle and the Life-Cycle Hypothesis," Journal of Economic Literature, American Economic Association, vol. 42(1), pages 145-170, March.
    22. Nehru, Vikram & Swanson, Eric & Dubey, Ashutosh, 1993. "A new database on human capital stock : sources, methodology and results," Policy Research Working Paper Series 1124, The World Bank.
    23. Myers, Stewart C. & Majluf, Nicolás S., 1945-, 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Working papers 1523-84., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    24. Suparna Chakraborty, 2005. "Real Estate Prices, Borrowing Constraints and Business Cycles -A Study of the Japanese Economy," Macroeconomics 0504012, EconWPA.
    25. V. V. Chari & Patrick J. Kehoe & Ellen R. McGrattan, 2002. "Accounting for the Great Depression (technical appendix)," Working Papers 619, Federal Reserve Bank of Minneapolis.
    26. Helene Poirson Ward, 2006. "The Tax System in India; Could Reform Spur Growth?," IMF Working Papers 06/93, International Monetary Fund.
    27. Ghosh, Saibal, 2006. "Did financial liberalization ease financing constraints? Evidence from Indian firm-level data," Emerging Markets Review, Elsevier, vol. 7(2), pages 176-190, June.
    28. Hiroko Oura, 2008. "Financial Development and Growth in India; A Growing Tiger in a Cage?," IMF Working Papers 08/79, International Monetary Fund.
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