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Financial Constraints in China: the conditioning effect of FDI and State-Owned corporate sector

Author

Listed:
  • Sandra Poncet

    () (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Walter Steingress

    (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain)

  • Hylke Vandenbussche

    (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain)

Abstract

Using a unique micro-level data set over the period 1998-2005 on Chinese firms, this paper presents empirical findings on the presence of credit constraints. Our findings are threefold. Firstly, private Chinese firms are credit constrained while state-owned firms and foreign-owned firms in China are not; Secondly, the geographical and sectoral presence of foreign capital alleviates credit constraints faced by private Chinese firms. Thirdly, geographical and sectoral presence of state firms aggravates financial constraints for private Chinese firms ("crowding out").

Suggested Citation

  • Sandra Poncet & Walter Steingress & Hylke Vandenbussche, 2010. "Financial Constraints in China: the conditioning effect of FDI and State-Owned corporate sector," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00633806, HAL.
  • Handle: RePEc:hal:cesptp:hal-00633806
    DOI: 10.1016/j.chieco.2010.03.001
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00633806
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    References listed on IDEAS

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    1. Boyreau-Debray, Genevieve & Wei, Shang-Jin, 2004. "Pitfalls of a State-Dominated Financial System: The Case of China," CEPR Discussion Papers 4471, C.E.P.R. Discussion Papers.
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    Cited by:

    1. Joachim Jarreau & Sandra Poncet, 2010. "Export Performance and Credit Constraints in China," Working Papers 2010-33, CEPII research center.

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