Abstract
Abstract: Using data of export transactions and the regional distribution of banking branches in China, this article examines the effect of bank development on the export scale and quality of firms. The results show that these factors are significantly enhanced by bank development. Compared to large state-owned commercial banks and rural financial institutions, the development of city commercial banks and joint-equity commercial banks has a more significant impact on improving the export scale and quality of firms. This article also examines the channels through which bank development benefits the export performance of firms. Indeed, bank development significantly increases firms' access to credit and reduces their credit costs, leading to improved export performance. These findings have important implications for financial development and export upgrading.
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