Bank finance heterogeneity in China: micro-level evidence

Abstract

This article finds that there is a nonlinear relationship between a city’s development level and a bank’s impact on firm performance in China, by using firm level data. In particular, bank’s impact on firm performance is largest in cities with intermediate level of development. This article reconciles the work done by Allen et al. (2005) and that done by Ayyagari et al. (2010).

Keywords:

• bank finance
• firm growth
• regional difference
• China

JEL Classification:

• R10
• G21
• O16