The finance-growth nexus in China: a meta-analysis

ABSTRACT

Drawing on a unique dataset from 30 studies on the finance-growth nexus in China, our prime objective is to examine the link between financial development and economic growth. After accounting for publication bias and between-study heterogeneity using meta-regression analysis, we find that the publication bias-corrected finance-growth nexus is positive and statistically significant. Interestingly, our findings also show that, when publication bias is corrected, the banking sector development plays a more crucial role in economic growth in China than the stock market development.

KEYWORDS:

• Finance-growth nexus
• meta-analysis
• publication bias
• banking sector development

JEL CLASSIFICATION:

• C83
• E44
• G10
• O40

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ The list of the 10 Chinese economics journals includes ‘Social Sciences in China (中国社会科学)’, ‘Management World (管理世界)’, ‘Economic Research Journal (经济研究)’, ‘China Economic Quarterly (经济学季刊)’, ‘The Journal of World Economy (世界经济)’, ‘Journal of Financial Research (金融研究)’, ‘China Industrial Economics (中国工业经济)’, ‘Journal of Quantitative & Technical Economics (数量经济技术经济研究)’, ‘Chinese Rural Economy (中国农村经济)’ and ‘Economic Perspectives (经济学动态)’.

² The most commonly used measure of financial development is the banking sector development, which is followed by the stock market development.