Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/163148
Authors: 
Shang, Hua
Song, Quanyun
Wu, Yu
Year of Publication: 
2017
Series/Report no.: 
ADBI Working Paper Series 649
Abstract: 
From the perspective of credit allocation, this paper analyzes the effects of credit market development on the innovative capacities of industrial firms in the People's Republic of China. Using a large dataset of industrial firms in 31 provinces in the People's Republic of China, we find that credit market development enhances firms' product innovation incentives and outcomes. We further show that firms' credit constraints and firms' performances are two channels through which credit market development affects innovative capacities of firms. Our results are neither driven by the increase in the quantity of credit, nor by the increase in the number of firms in a province. The results are robust to different samples, different estimation methods, and alternative measures of credit market development.
Subjects: 
Economics
Finance sector development
Industry and trade
China, People's Republic of
JEL: 
G15
O31
R11
Creative Commons License: 
https://creativecommons.org/licenses/by-nc-nd/3.0/igo/
Document Type: 
Working Paper

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