Financial Development and Patterns of Industrial Specialization: Evidence from China*

He, Qing; Chen, Xue; Zhu, Chenqi

doi:10.1093/rof/rfw024

Cited by 45 publications

(26 citation statements)

References 56 publications

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“…However, China's stock market appeared to be insufficiently ready to function as expected. For example, the stock market has little effect on regional industrial agglomeration (He et al ., ). Moreover, Cumming et al .…”

Section: Literature Reviewmentioning

confidence: 97%

What Drives China's 2015 Stock Market Surges and Turmoil?

Wang

Tsai

Xiongwei

2019

Asia-Pac J of Fin Stud

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Using high-frequency data, we investigate China's stock market surges and turmoil from 2014 to 2015 by employing GARCH family models to evaluate the effects of government policies, economic factors, and related announcements. The results indicate that China's stock market has primarily been driven by government policies rather than economic factors. During the period, the commentaries of the People's Daily further amplified the direction of market movements in the market surges and turmoil. In addition to individual policies and announcements, we explore the structural changes in volatility in different market stages and provide explanations for the distinct features of each stage.

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Section: Literature Reviewmentioning

confidence: 97%

What Drives China's 2015 Stock Market Surges and Turmoil?

Wang

Tsai

Xiongwei

2019

Asia-Pac J of Fin Stud

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“…In line with these assumptions, capital is perfectly mobile and can move in any directions subject to returns. However in reality, the free movement of capital is constrained by factors, such as asymmetric information (which may lead to problems of adverse selection and moral hazard); segmentation of credit markets and weak institutions (He et al 2017). Asymmetric information could cause credit rationing, that is, the lender may provide credit only to few borrowers and avoid lending to risky ones; high monitoring costs also prevent banks from lending to small and poor borrowers (Besley 1994;Stiglitz and Weiss 1981).…”

Section: Theoretical Analysismentioning

confidence: 99%

Banking in the Shadows: A Comparative Study of China and India

Arora

Zhang

2018

Aust Econ Hist Rev

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Recent years have seen the increasing concern for the flourish of shadow banking in China and India. In this paper, we aim to get a better understanding of the differences in trends and investigate the factors leading to the rise of shadow banking in these two major emerging economies. We find that financial exclusion is a common factor leading to the rise of shadow banking in China and India. While financial reform has taken place in India, financial repressive policies still prevail in China. Although several regulatory measures have been adopted in India and China, the size of the shadow banking in these two countries remains underestimated. Thus, streamlining and enhancing data collection is a key priority for both India and China. We also argue that the regulation in both countries should be more activity focused rather than sector or entity based, and it should be at par with banks. As shadow banks provide last mile connectivity and enhance financial inclusion, a balanced approach is required keeping in view both benefits and costs of the shadow banking system.

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“…Although this study investigates the prediction power of China's insider transactions for future market returns, China has most of the typical features of emerging market countries (He, Xue, & Zhu, 2017), so understanding China can help us understand emerging markets in general. For example, similar to most underdeveloped economies, outside investors in China have few rights against insiders' expropriations (Firth, Lin, Liu, & Wong, 2009).…”

Section: Introductionmentioning

confidence: 99%

Does aggregate insider trading predict stock returns in China?

Cheng

Wen

2018

Int. J Fin Econ

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This paper studies the information content of aggregate insiders' transactions in their own firms in China by analysing approximately 28,000 open market transactions from July 2007 to December 2014. The evidence suggests that publicly available information about aggregate insiders' transactions cannot predict future stock returns. However, the ability of aggregate insiders' transactions to predict future stock returns is positively associated with the strength of corporate governance. Results from vector autoregressive models and examination of profitable strategies corroborate these findings.

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Financial Development and Patterns of Industrial Specialization: Evidence from China*

Cited by 45 publications

References 56 publications

What Drives China's 2015 Stock Market Surges and Turmoil?

What Drives China's 2015 Stock Market Surges and Turmoil?

Banking in the Shadows: A Comparative Study of China and India

Does aggregate insider trading predict stock returns in China?

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