Credit Allocation and Firm Productivity Under Financial Imperfection: Evidence from Chinese Manufacturing Firms

References

• Allen, F., J. Qian, and M. Qian. 2005. Law, finance, and economic growth in China. Journal of Financial Economics 77:57–116. doi:10.1016/j.jfineco.2004.06.010.
   Web of Science ®Google Scholar
• Amore, M. D., C. Schneider, and A. Žaldokas. 2013. Credit supply and corporate innovation. Journal of Financial Economics 109:835–55. doi:10.1016/j.jfineco.2013.04.006.
   Web of Science ®Google Scholar
• Bai, C. E., J. Lu, and Z. Tao. 2006. The multitask theory of state enterprise reform: Empirical evidence from China. American Economic Review 96:353–57. doi:10.1257/000282806777212125.
   Web of Science ®Google Scholar
• Beck, T., A. Demirgüç-Kunt, and V. Maksimovic. 2005. Financial and legal constraints to growth: Does firm size matter? The Journal of Finance 60 (1):137–77. doi:10.1111/j.1540-6261.2005.00727.x.
   Web of Science ®Google Scholar
• Benhabib, J., and M. M. Spiegel. 2000. The role of financial development in growth and investment. Journal of Economic Growth 5:341–60. doi:10.1023/A:1026599402490.
   Web of Science ®Google Scholar
• Berman, N., and J. Héricourt. 2010. Financial factors and the margins of trade: Evidence from cross-country firm-level data. Journal of Development Economics 93 (2):206–17. doi:10.1016/j.jdeveco.2009.11.006.
   Web of Science ®Google Scholar
• Brandt, L., and H. B. Li. 2003. Bank discrimination in transition economies: Ideology, information, or incentives? Journal of Comparative Economics 31:387–413. doi:10.1016/S0147-5967(03)00080-5.
   Web of Science ®Google Scholar
• Brandt, L., J. Van Biesebroeck, and Y. Zhang. 2012. Creative accounting or creative destruction? firm-level productivity growth in Chinese manufacturing. Journal of Development Economics 97 (2):339–51. doi:10.1016/j.jdeveco.2011.02.002.
   Web of Science ®Google Scholar
• Bronzini, R., and P. Piselli. 2016. The impact of R&D subsidies on firm innovation. Research Policy 45 (2):442–57. doi:10.1016/j.respol.2015.10.008.
   Web of Science ®Google Scholar
• Buera, F., J. P. Kaboski, and Y. Shin. 2009. Finance and development: A tale of two sectors. American Economic Review 101:1964–2002. doi:10.1257/aer.101.5.1964.
   Web of Science ®Google Scholar
• Cetorelli, N., and M. Gambera. 2001. Banking market structure, financial dependence and growth: International evidence from industry data. The Journal of Finance 56 (2):617–48. doi:10.1111/0022-1082.00339.
   Web of Science ®Google Scholar
• Chen, H. 2006. Development of financial intermediation and economic growth: The Chinese experience. China Economic Review 17:347–62. doi:10.1016/j.chieco.2006.01.001.
   Web of Science ®Google Scholar
• Chen, M., and A. Guariglia. 2013. Internal financial constraints and firm productivity in China: Do liquidity and export behavior make a difference? Journal of Comparative Economics 41 (4):1123–40. doi:10.1016/j.jce.2013.05.003.
   Web of Science ®Google Scholar
• Cull, R., L. C. Xu, and T. Zhu. 2009. Formal finance and trade credit during China’s transition. Journal of Financial Intermediation 18:173–92. doi:10.1016/j.jfi.2008.08.004.
   Web of Science ®Google Scholar
• Desai, M. A., C. F. Foley, and K. J. Forbes. 2008. Financial constraints and growth: Multinational and local firm responses to currency depreciations. Review of Financial Studies 21 (6):2857–88. doi:10.1093/rfs/hhm017.
   Web of Science ®Google Scholar
• Erosa, A., and A. Hidalgo-Cabrillana. 2005. On capital market imperfections as a source of low TFP and economic rents. Working paper, No. tecipa-200, University of Toronto.
   Google Scholar
• Fan, G., X. Wang, and H. P. Zhu. 2011. NERI index of marketization of China’s provinces. Beijing: Economics Science Press.in Chinese.
   Google Scholar
• Firth, M., C. Lin, P. Liu.; et al. 2009. Inside the black box: Bank credit allocation in China’s private sector. Journal of Banking & Finance 33:1144–55. doi:10.1016/j.jbankfin.2008.12.008.
   Web of Science ®Google Scholar
• Foster, L., J. Haltiwanger, and C. Syverson. 2008. Reallocation, firm turnover, and efficiency: Selection on productivity or profitability. American Economic Review 98 (1):394–495. doi:10.1257/aer.98.1.394.
   Web of Science ®Google Scholar
• Gatti, R., and I. Love. 2008. Does access to credit improve productivity? Evidence from bulgaria1. Economics of Transition 16 (3):445–65. doi:10.1111/j.1468-0351.2008.00328.x.
   Web of Science ®Google Scholar
• Guariglia, A., and S. Poncet. 2008. Could financial distortions be no impediment to economic growth after all? Evidence from China. Journal of Comparative Economics 36:633–57. doi:10.1016/j.jce.2007.12.003.
   Web of Science ®Google Scholar
• Guillaumont-Jeanneney, S., P. Hua, and Z. Liang. 2006. Financial development, economic efficiency, and productivity growth: Evidence from China. The Developing Economies 44 (1):27–52. doi:10.1111/j.1746-1049.2006.00002.x.
   Web of Science ®Google Scholar
• Han, J., and Y. Shen. 2015. Financial development and total factor productivity growth: Evidence from China. Emerging Markets Finance and Trade 51 (sup1):S261–S274. doi:10.1080/1540496X.2014.998928.
   Web of Science ®Google Scholar
• Hsieh, C. T., and P. J. Klenow. 2009. Misallocation and manufacturing TFP in China and India. Quarterly Journal of Economics 124 (4):1403–48. doi:10.1162/qjec.2009.124.4.1403.
   Web of Science ®Google Scholar
• Hsu, P. H., X. Tian, and Y. Xu. 2014. Financial development and innovation: Cross-country evidence. Journal of Financial Economics 112 (1):116–35. doi:10.1016/j.jfineco.2013.12.002.
   Web of Science ®Google Scholar
• Hyytinen, A., and O. Toivanen. 2005. Do financial constraints hold back innovation and growth?: Evidence on the role of public policy. Research Policy 34 (9):1385–403. doi:10.1016/j.respol.2005.06.004.
   Web of Science ®Google Scholar
• Jeong, H., and R. M. Townsend. 2007. Sources of TFP growth: Occupational choice and financial deepening. Economic Theory 32 (1):179–221. doi:10.1007/s00199-006-0201-8.
   Web of Science ®Google Scholar
• King, R. G., and R. Levine. 1993a. Finance and growth: Schumpeter might be right. The Quarterly Journal of Economics 108:717–37. doi:10.2307/2118406.
   Web of Science ®Google Scholar
• King, R. G., and R. Levine. 1993b. Finance, entrepreneurship and growth. Journal of Monetary Economics 32 (3):513–42. doi:10.1016/0304-3932(93)90028-E.
   Web of Science ®Google Scholar
• Krishnan, K., D. K. Nandy, and M. Puri. 2015. Does financing spur small business productivity? Evidence from a natural experiment. Review of Financial Studies 28 (6):1768–809. doi:10.1093/rfs/hhu087.
   Web of Science ®Google Scholar
• Levinsohn, J., and A. Petrin. 2003. Estimating production functions using inputs to control for unobservables. The Review of Economic Studies 70 (2):317–41. doi:10.1111/roes.2003.70.issue-2.
   Web of Science ®Google Scholar
• Liang, Q., and J. Z. Teng. 2006. Financial development and economic growth: Evidence from China. China Economic Review 17:395–411. doi:10.1016/j.chieco.2005.09.003.
   Web of Science ®Google Scholar
• Lin, H. D. 2011. Foreign bank entry and firms’ access to bank credit: Evidence from China. Journal of Banking & Finance 35:1000–10. doi:10.1016/j.jbankfin.2010.09.015.
   Web of Science ®Google Scholar
• Lin, J. Y., X. Sun, and H. X. Wu. 2015. Banking structure and industrial growth: Evidence from China. Journal of Banking & Finance 58:131–43. doi:10.1016/j.jbankfin.2015.02.012.
   Web of Science ®Google Scholar
• Liu, Q., and L. D. Qiu. 2016. Intermediate input imports and innovations: Evidence from Chinese firms’ patent filings. Journal of International Economics 103:166–83. doi:10.1016/j.jinteco.2016.09.009.
   Web of Science ®Google Scholar
• Manova, K. 2013. Credit constraints, heterogeneous firms, and international trade. The Review of Economic Studies 80 (2):711–44. doi:10.1093/restud/rds036.
   Web of Science ®Google Scholar
• Melitz, M. J. 2003. The impact of trade on intra-industry reallocations and aggregate industry productivity. Econometrica 71 (6):1695–725. doi:10.1111/ecta.2003.71.issue-6.
   Web of Science ®Google Scholar
• Nucci, F., A. Pozzolo, and F. Schivardi. 2005. Is firm’s productivity related to its financial structure? Evidence from microeconomic data. Rivista Di Politica Economica 95 (1):269–90.
   Google Scholar
• Olley, G. S., and A. Pakes. 1996. The dynamics of productivity in the telecommunications equipment industry. Econometrica 64 (6):1263–97. doi:10.2307/2171831.
   Web of Science ®Google Scholar
• Ouyang, P., T. Zhang, and Y. Dong. 2015. Market potential, firm exports and profit: Which market do the Chinese firms profit from? China Economic Review 34:94–108. doi:10.1016/j.chieco.2015.03.011.
   Web of Science ®Google Scholar
• Poncet, S., W. Steingress, and H. Vandenbussche. 2010. Financial constraints in China: Firm-level evidence. China Economic Review 21:411–22. doi:10.1016/j.chieco.2010.03.001.
   Web of Science ®Google Scholar
• Qian, J., P. E. Strahan, and Z. Yang. 2015. The impact of incentives and communication costs on information production and use: Evidence from bank lending. Journal of Finance 70 (4):1457–93. doi:10.1111/jofi.12251.
   Web of Science ®Google Scholar
• Qian, M., and B. Y. Yeung. 2015. “Bank financing and corporate governance.”. Journal of Corporate Finance 32:258–70. doi:10.1016/j.jcorpfin.2014.10.006.
   Web of Science ®Google Scholar
• Rajan, R. G., and L. Zingales. 1998. Financial dependence and growth. The American Economic Review 88:559–86.
   Web of Science ®Google Scholar
• Restuccia, D., and R. Rogerson. 2008. Policy distortions and aggregate productivity with heterogeneous establishments. Review of Economic Dynamics 11 (4):707–20. doi:10.1016/j.red.2008.05.002.
   Web of Science ®Google Scholar
• Roberts, M. J., D. Y. Xu, X. Fan., et al. “A structural model of demand, cost, and export market selection for Chinese footwear producers.” NBER working paper, paper series, 2012: 17725.
   Google Scholar
• Song, Z., K. Storesletten, and F. Zilibotti. 2011. Growing like China. The American Economic Review 101 (1):196–233. doi:10.1257/aer.101.1.196.
   Web of Science ®Google Scholar
• Staiger, D., and J. H. Stock. 1997. Instrumental variables regression with weak instruments. Econometrica 65:557–86. doi:10.2307/2171753.
   Web of Science ®Google Scholar
• Stein, J. 2002. Information production and capital allocation: Decentralized versus hierarchical firms. Journal of Finance 57:1891–921. doi:10.1111/0022-1082.00483.
   Web of Science ®Google Scholar