Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212798 
Year of Publication: 
2014
Series/Report no.: 
BOFIT Discussion Papers No. 12/2014
Publisher: 
Bank of Finland, Institute for Economies in Transition (BOFIT), Helsinki
Abstract: 
The paper investigates the influences of financial development on patterns of industrial specialization across China's regions. We find that industrial sectors reliant on access to external finance are found to concentrate in regions with developed financial markets. Both foreign direct investment (FDI) and informal financing channels are shown to play significant roles in shaping patterns of industrial specialization in China. In contrast, proxies for formal financial markets, e.g. the banking system and capital markets have few effects on regional industrial agglomeration. The role of financial development remains robust to instrumental variable estimation and controlling for other traditional determinants of regional specialization.
Subjects: 
financial development
informal finance
FDI
industrial specialization
JEL: 
G10
G20
L60
Persistent Identifier of the first edition: 
ISBN: 
978-952-6699-82-0
Document Type: 
Working Paper

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