Financial Reform In China Research Articles

Financial reform and financing constraints: Some evidence from listed Chinese firms

Abstract This paper examines the impact of recent financial reforms in China on the financing constraints and investment of publicly-listed Chinese firms. Two continuous indices are constructed to measure the evolution and intensity of financial reforms: a financial liberalization index and a capital control index. Dynamic panel GMM method is used to estimate firms' financing constraints in an Euler-equation investment model. Based on panel data of listed firms for 1996–2007, we find that large firms face no credit constraints and smaller firms display significant constraints. However, the sensitivity of large firms' investment to their cash holdings is heightened as more financial reforms take place. It appears that reforms that gradually eliminate preferential treatments to large firms, primarily state-owned enterprises (SOEs) in China, have subjected these firms' investment decisions to stricter market-based discipline and therefore raised their financing constraints. No significant change in the financing constraint is detected for smaller firms in China. This is interpreted as financial reform in China has not been substantial enough for its benefits to reach smaller firms.

Corporate Governance and Financial Reform in China's Transition Economy. Jing Leng

Previous articleNext article No AccessREVIEWSCorporate Governance and Financial Reform in China's Transition Economy. Jing Leng Richard PascoeRichard Pascoe Search for more articles by this author PDFPDF PLUS Add to favoritesDownload CitationTrack CitationsPermissionsReprints Share onFacebookTwitterLinkedInRedditEmail SectionsMoreDetailsFiguresReferencesCited by The China Journal Volume 66July 2011 Published on behalf of the Australian Centre on China in the World at the Australian National University Article DOIhttps://doi.org/10.1086/tcj.66.41262837 Views: 7Total views on this site © The China JournalPDF download Crossref reports no articles citing this article.

Corporate Governance and Financial Reform in China's Transition Economy – By Leng Jing

Corporate Governance: An International ReviewVolume 18, Issue 5 p. 489-490 Corporate Governance and Financial Reform in China's Transition Economy – By Leng Jing R. I. (Bob) Tricker, R. I. (Bob) Tricker Founding Editor and Member Editorial Review Board, CGIRSearch for more papers by this author R. I. (Bob) Tricker, R. I. (Bob) Tricker Founding Editor and Member Editorial Review Board, CGIRSearch for more papers by this author First published: 14 September 2010 https://doi.org/10.1111/j.1467-8683.2010.00824.xRead the full textAboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL No abstract is available for this article. Volume18, Issue5September 2010Pages 489-490 RelatedInformation

Review of Corporate Governance and Financial Reform in China's Transition Economy

Review of Corporate Governance and Financial Reform in China's Transition Economy

Chinese Public Finance Framework: A Critical Analysis

This paper explores the complexities of government financial management in China and examines the nature of the recent Public Finance Framework reform in that country. We argue that this Public Finance Framework reform is not just the latest idea in a centrally dominated reform agenda (and a logical and strategic development in the process of social, political and economic transformation) but that it reflects the Central Government's struggle to fine-tune central-local financial relationships and to grapple with the consequences of previously misplaced delegation of government budgets. In doing so, the paper challenges the prescriptive research which often pervades policy studies in China. Instead, it offers a critical reflection on the historical and contemporary contingencies shaping Chinese state administration and sheds new light on the background, the implementation and the future prospects of public sector financial reform in China. Overall, our contextual analysis provides a starting point for more critical research of changes in the Chinese state administration at both policy and organisational levels.

Review of Corporate Governance and Financial Reform in China's Transition Economy

Review of <i>Corporate Governance and Financial Reform in China's Transition Economy</i>

Impact of financial liberalisation on stock market liquidity: experience of China

PurposeThe purpose of this paper is to assess the impact of the recent financial reforms in China. Following the country's accession to the World Trade Organization, financial liberalisation has picked up considerable momentum. Wide‐ranging reforms introduced encompass deregulation in the banking sector and refinements in various financial markets, as well as allowing more freedom for Chinese and foreign investors to participate and interact domestically and overseas.Design/methodology/approachCompared to other studies on financial liberalisation, this study uses a panel data regression model to analyse a relatively narrower aspect of financial reforms, namely, the impact on stock market liquidity.FindingsUsing a data set drawn from the Shanghai stock market, the authors find a positive and significant liquidity impact associated with the recent round of measures.Originality/valueThe result reflects not only an improvement in capital allocation efficiency in China's equity market but, from a financial stability point of view, also a reduction in its vulnerability. The finding also provides evidence on one of the important channels in which financial liberalisation can be transformed into economic growth over time.

Corporate Governance and Financial Reform in China’s Transition Economy

This book provides a comprehensive and up to date review and critique of corporate governance reforms and related financial reforms in China during the country's transition to a market economy, involving its enterprise, banking and capital markets sectors.

Impact of Financial Liberalisation on Stock Market Liquidity: Experience of China

This paper assesses the impact of the recent financial reforms in China. Following the country's accession to the World Trade Organization, financial liberalisation has picked up considerable momentum. Measures introduced encompass deregulation in the banking sector and refinements in various financial markets, as well as allowing more freedom for Chinese and foreign investors to participate and interact domestically and overseas. Compared to other studies on financial liberalisation, this study focuses on a relatively narrower aspect of financial reforms namely, the impact on stock market liquidity. Using a panel data set drawn from the Shanghai stock market, we find a positive and significant liquidity impact associated with the recent round of measures, which reflects not only an improvement in capital allocation efficiency in China's equity market but, from a financial stability point of view, also a reduction in its vulnerability. The finding also provides evidence on one of the important channels in which financial liberalisation can be transformed into economic growth over time.

Financial Reforms in China and India: A Comparative Anaylsis

This paper surveys financial reforms in the world's two most populous countries where governments dominate bank ownership. This ownership creates tensions between governments' social goals and bank efficiency since bank lending decisions are not based on the creditworthiness of potential borrowers. The paper examines the costs of this tension that include inadequate access to bank finance for productive borrowers, foregone efficiencies in the debt markets and systemic risks of mis-directed lending and bank investments. The paper provides comparative estimates of the systemic risks and concludes that reforms have reduced these risks. Further reform is required as these economies become more complex since pressures for efficient financial systems will grow. India has all the parts of a modern financial system were it willing to remove social constraints while China still has to reconcile the tensions between its political goal of gradual controlled change and its official commitment to modern commercial banking and finance.

Partial Reform Equilibrium, Chinese Style

Incomplete financial reform in China is puzzling because Premier Zhu Rongji, a seemingly promarket technocrat, was largely insulated from explicitly rent-seeking pressure and leftist ideology when he carried out a massive restructuring of Chinese banks in 1997. Yet at the end of his tenure as premier, the financial sector continued to channel the bulk of savings toward the state. Given the complexity of Zhu's policies, we cannot begin analyzing them if we conceive reform as a neat, coherent policy shift. In this article, competing hypotheses of policy change are tested on Zhu's financial “reform,” which is conceptualized as a bundle of discrete policies, each having different and at times contradictory impact on the economy. With this conceptualization, banking centralization, the Herculean efforts to digest nonperforming loans, and stagnation in interest rate and private banking reform can best be understood as a coherent political survival strategy.

The process of financial reforms in China

This study aims to show that financial reforms in China can be viewed as an endogenous adjustment process responding primarily to economic growth and changes in political constraints. The author's argument is thus against the mainstream view in which financial reforms are regarded as primary policy tools for the promotion of economic growth. Three factors are carefully examined for the explanation of the endogenous characteristics of financial reforms. First, this paper takes a close look at endogenous aspects of Chinese financial repression. The endogenous characters of financial repression explain why financial reforms in China follow an endogenous path. Second, recent developments of legal frameworks are found to have been institutional responses to macroeconomic imbalances, financial disorders, and increased demands for property right protection. Finally, this paper shows that the lack of market infrastructure and various political constraints have been major obstacles for China's capital market development.

Trade and Financial Reform in China: Impacts on the World Economy

Despite the setbacks from the recent Asian currency crisis, the ascendancy of Asia as an economic centre of world economic activity is likely to continue into the 21st century. A key issue that will shape the role of Asia, and indeed the shape of the world economy in the 21st century, is the economic development of China. To date China has successfully weathered the currency storm in Asia and continues on a program of economic reform. If anything, the problems of Japan and Korea provide powerful lessons for other countries undergoing rapid economic growth and structural change. These lessons include the importance of a well developed financial sector with lending and investment decisions based on market signals rather than government directives. Whether China can further integrate smoothly into global markets and sustain the fast growth of the last few decades will be a crucial development in the world economy. In this paper, we explore the impacts of continued Chinese economic reform with a focus on the role of international financial flows both in the adjustment within China as well as in the transmission of Chinese reforms to the rest of the world.(This abstract was borrowed from another version of this item.)

Carrying forward financial reform in China and promoting internationalization of financial supervision

Carrying forward financial reform in China and promoting internationalization of financial supervision

The Asian financial crisis and financial reforms in China

Although China has avoided the direct attack of the Asian financial crisis, it has suffered secondary consequences leading to an economic slowdown. More importantly, the plight of its neighboring countries has driven home the urgency of financial reforms as China shares many of the problems at the root of the crisis in Thailand, Indonesia, Malaysia, and Korea. This article reviews the reform measures adopted by the Chinese government since the crisis. It analyzes the political dynamics of financial reforms in terms of state preferences and state capacities. In retrospect, the Asian financial crisis may well be seen as a turning point in reforming China's financial system.

Tethered Deer: Government and Economy in a Chinese County (review)

350 China Review International: Vol. 4, No. 2, Fall 1997 Overall, Financial Reform in China is recommended to anyone interested in changes in the financial system of a country whose economic potential should not be taken lighüy. David C. Yang University of Hawai'i at Mänoa David C. Yang is a professor ofaccounting in the College ofBusiness Administration specializing in international accounting. Marc Blecher and Vivienne Shue. Tethered Deer: Government and Economy in a Chinese County. Stanford: Stanford University Press, 1996. xvi, 267 pp. Hardcover $39.50, isbn 0-8047-2565-9. This jointly authored monograph offers a window onto the exceedingly varied activities of county government during the recent period of economic reform in the People's Republic of China. Blecher and Shue's approach is somewhat ethnographic , focused on a single rural county in Hebei. The data derive from the their extensive and detailed briefings with county officials and operatives concerning a broad range of subjects—the complexities of county finances, intersecting bureaucratic structures and obligations, industrial organization and management, labor force segmentation, and so form. Given the authors' focus on the functioning of county government, their method passes muster as a kind ofparticipant observation. Blecher and Shue's account of the vitality of this rural Hebei community, the dynamism ofits economic development, and the success of its county government in responding to new local needs deriving from the economic reforms cannot help but call to my mind the somewhat similar experience ofDongyang County, Zhejiang Province, where I carried out a study ofrural enterprises roughly contemporaneous with theirs. Blecher and Shue's description of county government workings has about it die ring of genuine familiarity. Especially impressive , ifless familiar, was die level of cooperation Blecher and Shue were afforded by their local hosts, and the quality of the data they were able to gather as y mversity a resuit gy contrast; mylocal hosts in Dongyang were not nearly as gracious and forthcoming in providing materials and resources, despite Dongyang's own record of extremely successful economic performance. ofHawai'i Press Reviews 351 The complexities in Blecher and Shue's analysis can be a bit overwhelming, and I would hesitate to assign this book to an undergraduate audience on that account . The discussion ofthe "triple stranded" revenue pathways ofcounty finance (pp. 45 ff.), for example, is a rather tough slog. But the authors do in the end succeed in making sense ofthe complexities, and the patience ofthe specialist reader is rewarded. Blecher and Shue document the "welcome expansion" ofcommercial activity that has enlivened the county's overall local economic picture, allowing great strides to be made in satisfying local consumer demand (p. 149). The government role in the construction of a new, modernized marketplace in the county town is described in great detail. The aspirations expressed for the new market as part of a wider urban development scheme, conceived to help solve public problems of traffic control, urban overcrowding, and commercial regulation (p. 140), were, in the end, fulfilled beyond its planners' wildest expectations. The authors are careful to note the many continuities in county government practice with the Mao period, which they were privileged to have caught the tail end ofwhen visiting the county in the late 1970s, but they also see the county government's role as changing. As the local economy has expanded under the economic reforms, the command structure in which the county government is embedded has come to command a smaller proportion ofoverall resources, and regulatory functions in such areas as urban planning, environmental protection, water conservation, and industrial development have come to replace command functions in the county government's day-to-day work (p. 32). Examples of successful government intervention in each of these areas are highlighted, and county government is characterized as responding flexibly in its roles as mediator in intra-county disputes, and advocate in inter-county disputes (p. 157). I was tantalized but ultimately unsatisfied with the attention given to the collective and private industrial sectors of the county, which are described in rather superficial fashion. Perhaps it is my own interest in the subject that prejudices me in this regard, but after stating that "by 1985...

Perspectives on Accounting and Finance in China , and: Auditing Standards of the People's Republic of China , and: Financial Reform in China (review)

Perspectives on Accounting and Finance in China , and: Auditing Standards of the People's Republic of China , and: Financial Reform in China (review)

Asian economies in transition: reforming centrally planned economies

Contents: Preface 1. The Asian Transition Economies 2. Economic Reform in China,1978-94 3. Direct Foreign Investment in China 4. Financial Reform in China 5. Economic Reform in Indochina 6. Mongolia's Economic Reforms 7. The Central Asian Republics 8. Azerbaijan 9. The Decision to Use the Ruble or to Issue National Currencies 10. The Tumen River Project: Cooperation among Reformed and non-Reformed Socialist Economies 11. Lessons from China for other Transition Economies References Index

Financial reform in China

Journal Article Financial reform in China Get access Financial reform in China. Edited by On Kit Tam. London: Routledge. 1995. 195pp. Index. £40.00. ISBN 0 415 01971 0. S. P. Chakravarty S. P. Chakravarty 1University of Wales, Bangor Search for other works by this author on: Oxford Academic Google Scholar International Affairs, Volume 72, Issue 3, July 1996, Page 639, https://doi.org/10.2307/2625666 Published: 01 July 1996

The Role of Central Banking in China's Economic Reforms (review)

Reviews 135 Carsten Holz. The Role ofCentral Banking in China's Economic Reforms Cornell EastAsia Series, no. 59. Ithaca, NewYork: Cornell University East Asia Program, 1992. xiii, 220 pp. This is a timelybook for specialists on China's economy. Despite its many shortcomings , it may well be an indispensable book for those who focus on China's monetary policy and financial system. The author displays an uncanny foresight when he motivates the book by asking in the preface (apparently written in mid-1992): "Is overheating and subsequent clamp-down an inevitable phenomenon in the Chinese economy?" and then in the last sentence of the book: With a reformist tide rising in the PRC in 1992 it would not be astonishing ifbefore long a more reform-oriented team were to take over the leadership of the PBC [reviewer's note: People's Bank of China] and, parallel to the changes in the real economy, once more set out to modernize central banking. At the time of this review (September 1993), China is indeed going through its fourth episode of"overheating and subsequent clampdown" since reform began in 1979, and indeed a "more reform-oriented team" has "taken over the leadership ofthe PBC ... (to) set out to modernize central banking." When Vice Premier Zhu Rongji took over the governorship ofthe central bank in early July, for the first time the People's Bank of China is headed by an official who is apparently committed to monetary and financial reform and is endowed with sufficient political clout to overcome resistance from all levels of the government. Monetary and financial reform in China is long overdue. Since 1978, reform has transformed the nation from a rigidly controlled and centrally planned economy to the vibrant and increasingly market-oriented economy it is today. It has brought prosperity and an improved standard ofliving to hundreds of millions ofpeople in that country. Its success provides a sharp contrast to the disastrous outcomes ofreform in virtually all the other formerly centrally planned economies. Yet, as this book's author correctly points out, China's success in economic copyright1994reform has beenlimited to its real economy: in agricultural prices, foreign trade, by Universityoftownship and village industries, private andjoint-venture enterprises, and so on. Hawai'i PressThe essence ofthe reform in the real economyhas been the gradual removal of 136 China Review International: Vol. ?, No. ?, Spring 1994 state controls that had strangled productive incentives. In contrast, little of that has occurred in the financial sector. Banks continue to serve as the handmaiden of the government. Loans are allocated according to central planning, as they were before the reform. Unlike before the reform, however, because decentralization ofpolitical power has increasingly led to regional economic fragmentation, bank loans are also directed by local government officials to support local industries , often in disregard for the soundness of the loans and the loan limits proscribed in the national credit planning as well. Under these circumstances, the waste of the population's savings has been enormous, and the central bank's control of the nation's money supply has become increasingly ineffective. At long last, the Chinese authorities are getting ready to undertake the arduous task ofmonetary and financial reform. Reform has been made necessary by the general recognition that long-run economic progress requires a more market -oriented financial system, but the task has been made more arduous by the powerful vested interests at various levels of the government and by enterprises that have thrived under the present chaotic system. As the drama of China's monetary and financial reform unfolds, those who are interested in the Chinese economy in general and its monetary policy and financial system in particular will find this book a useful background reading, focused as it is on central banking, to supplement the much more comprehensive World Bank study, China: Financial Sector Policies and Institutional Development (Washington, D.C., 1990). After a briefintroduction, which provides a broad-brushed sketch of the structure of China's financial system, the book is divided into two parts plus a concluding chapter. Part 1 introduces the organizational structure of the People's Bank of China, and then, in the subsequent chapters, describes the central...