Does Shanghai International Financial Center Promote RMB Internationalization?

Abstract

The construction of the Shanghai International Financial Center was completed in 2020, which signaled the new age of financial reforms in China. The Shanghai International Financial Center plays a significant part in the progress of RMB internationalization. However, empirical proof of the impacts remains few. So, we conducted an empirical analysis to determine if the Shanghai International Financial Center promoted RMB internationalization effectively. To obtain robust results, we conducted regressions with Newey–West standard errors, Cochrane–Orcutt estimation, and Prais–Winsten estimation. We observed that the Shanghai International Financial Center has significant positive effects on RMB internationalization by expanding financial scale and activity. The findings give adequate evidence to support the theories advanced in prior research, and the methodology and indicators used in the study may serve as a guide for future research. We made several policy discussions of the findings regarding the continued expansion of the offshore market and capital liberalization within Shanghai.

Does Green Finance Policy Contribute to ESG Disclosure of Listed Companies? A Quasi-natural Experiment from China

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Does Renminbi internationalization matter for petroleum security in China? Evidence from a disaggregate analysis

“…Liu (2011) and Hussain et al (2017) used a linear causality test and found significant positive causality between oil price and RMB. More recent studies focus on the impact of RBMI on the international competitiveness of RMB, trade and financing of the belt‐road initiative (Cui et al, 2022; Knoerich, 2021; Li & Xu, 2022; Liang, 2020). Specifically, Wang et al (2021) examined the impact of RMB internationalization and the international situation on China's foreign exchange market as well as the dynamic linkages between the US Dollar/RMB and special drawing right (SDR)/RBM.…”

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