An empirical analysis of the influence of financial development on export trade: evidence from Jiangsu province, China

Figures & data

Figure 1. Variation trend of Jiangsu Province’s financial development indicators from 1985–2016.

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Figure 2. Trend of annual export trade growth rate and export rate structure from 1985–2016.

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 1. Descriptive statistical analysis of each variable of interest.

	EXG	EXS	FGR	FIR	IDEP	SLR	RFE	LNFDI
Mean	0.1935	0.9460	9.6228	1.7887	1.7887	0.8921	6.6497	12.8281
Median	0.1655	0.9550	9.6350	1.7100	1.7150	0.7400	6.8005	13.4450
Maximum	0.5370	0.9840	12.2700	2.7900	3.5400	1.5700	8.6190	15.0900
Minimum	−0.1630	0.8680	6.4500	0.9700	0.3900	0.6900	2.9370	7.0800
Std. Dev.	0.1674	0.0256	1.7741	0.5356	0.8941	0.2708	1.7370	2.3847
Skewness	0.2408	−1.5031	−0.1673	0.1796	0.0797	1.3735	−0.6923	−1.1620
Kurtosis	2.5660	5.4841	1.8128	1.7706	1.6195	3.4251	2.2872	3.0365
Jarque-Bera	0.5605	20.278	2.0284	2.1871	2.5748	10.3025	3.2342	7.2037
observations	32	32	32	32	32	32	32	32

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 2. Correlation analysis among the variables of interest.

	EXG	EXS	FGR	FIR	SLR	IDEP	LNFDI	RFE
EXG	1.0000	0.0324	−0.1189	−0.2040	−0.2000	0.0059	0.1037	0.5004
EXS	0.0324	1.0000	0.8035	0.7194	−0.8504	0.7239	0.8788	0.6724
FGR	−0.1189	0.8035	1.0000	0.9610	−0.8450	0.9227	0.9187	0.5134
FIR	−0.2040	0.7194	0.9610	1.0000	−0.7272	0.9448	0.8040	0.3529
SLR	−0.2000	−0.8504	−0.8450	−0.7272	1.0000	−0.7612	−0.9636	−0.8622
IDEP	0.0059	0.7239	0.9227	0.9448	−0.7612	1.0000	0.8235	0.4636
LNFDI	0.1037	0.8788	0.9187	0.8040	−0.9636	0.8235	1.0000	0.7602
RFE	0.5004	0.6724	0.5134	0.3529	−0.8622	0.4636	0.7602	1.0000

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 3. Results of the principal component analysis for SLR, IDEP, and FIR.

Variables	Initial eigenvalue					Extracted sums of squared loadings
	Total	Variance percentage			Cumulative percentage	Total		Variance percentage	Cumulative percentage
1	2.6261		87.5391	87.5391		2.6261		87.5391	87.5391
2	0.3203		10.6769	98.2160
3	0.0535		1.7840	100.000

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 4. Augmented Dickey–Fuller unit root test results.

Variable	Number of differences	(c,t,n)	ADF	1%	5%	10%	Result
EXG	0	(c,0,7)	−3.1166	−3.6616	−2.9604	−2.6191	smooth
EXS	0	(c,t,7)	−4.2488	−4.2845	−3.5628	−3.2152	smooth
FE	1	(c,t,7)	−4.1884	−4.3098	−3.5742	−3.2217	smooth
FGR	1	(c,t,7)	−4.1936	−4.3098	−3.5742	−3.2217	smooth
LNFDI	1	(c,t,7)	−4.1439	−4.2967	−3.5683	−3.2183	smooth
RFE	1	(c,t,7)	−4.8102	−3.6701	−2.9639	−2.6210	smooth

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 5. Results of the Granger test for export trade growth rate and independent variables.

Null hypothesis	F-statistic	Prob.	Results
DFGR is not a Granger Cause of DEXG	2.2290	0.1294	Accept
DFE is not a Granger Cause of DEXG	2.8831	0.0763	Accept
DLNFDI is not a Granger Cause of DEXG	1.4893	0.2456	Accept
DRFE is not a Granger Cause of DEXG	2.5411	0.0997	Accept

Test results: FE, FGR, FDI, and RFE did not show a Granger causality with EXG.

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 6. Results of the Granger test for export trade structure and independent variables.

Null hypothesis	F-statistic	Prob.	Results
DFGR is not a Granger cause of DEXS	0.8480	0.4406	Accept
DFE is not a Granger cause of DEXS	0.0909	0.9134	Accept
DLNFDI is not a Granger cause of DEXS	0.4128	0.6663	Accept
DRFE is not a Granger cause of DEXS	0.9737	0.3921	Accept

Test Results: FE, FGR, FDI and RFE were not a Granger cause of EXS.

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 7. Regression results for the influence of financial development on the export trade of Jiangsu Province.

Variable	Coefficient	Std. Error	t-Statistic	Prob.
FE	0.2168	0.0909	2.3843	0.0247
FGR	−0.1510	0.0738	−2.0456	0.0510
LNFDI	0.0003	0.0467	0.0067	0.9947
RFE	0.0664	0.0289	2.2953	0.0300
C	0.8535	0.3265	2.6138	0.0147
R-squared	0.5280	Mean dependent variable	0.2019
Adjusted R-squared	0.4553	S.D. dependent variable	0.1632
S.E. of regression	0.1204	Akaike info criterion	−1.2481
Sum squared residuals	0.3773	Schwarz criterion	−1.0168
Log likelihood	24.3465	F-statistic	7.2713
Durbin-Watson stat	1.9518	Prob(F-statistic)	0.0004

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).

Table 8. Regression results of the effect of financial development on the export trade structure of Jiangsu Province.

Variable	Coefficient	Std. Error	t-Statistic	Prob.
FE	0.0002	0.0095	0.0242	0.9808
FGR	−0.0036	0.0077	−0.4680	0.6436
LNFDI	0.0120	0.0048	2.4530	0.0212
RFE	−0.0007	0.0030	−0.2473	0.8066
C	0.8306	0.0341	24.2939	0.0000
R-squared	0.7821	Mean dependent var		0.9448
Adjusted R-squared	0.7486	S.D. dependent var		0.0251
S.E. of regression	0.0126	Akaike info criterion		−5.7614
Sum squared resid	0.0041	Schwarz criterion		−5.5301
Log likelihood	94.3018	F-statistic		23.3388
Durbin-Watson stat	1.6730	Prob(F-statistic)		0.0000

Source: Jiangsu Province Bureau of statistics (http://tj.jiangsu.gov.cn/index.html) and the China Banking and Insurance Regulatory Commission. (http://www.cbirc.gov.cn/).