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Export Performance and Credit Constraints in China

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  • Joachim Jarreau
  • Sandra Poncet

Abstract

We investigate how the export performance of firms in China is influenced by credit constraints. Using panel data from Chinese customs for 1997-2007, we show that credit constraints restrict international trade flows and affect the sectoral composition of firms’ activity. We confirm that credit constraints provide an advantage to Foreign-owned firms and joint ventures over private domestic firms as their export performance is systematically greater in sectors with higher levels of financial vulnerability measured in a variety of ways. We however find that financial sector liberalization has partially reduced these distortions in exports over the period.

Suggested Citation

  • Joachim Jarreau & Sandra Poncet, 2010. "Export Performance and Credit Constraints in China," Working Papers 2010-33, CEPII research center.
    • Handle: RePEc:cii:cepidt:2010-33
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    References listed on IDEAS

    as
    1. Wei, Shang-Jin & Boyreau-Debray, Genevieve, 2004. "Pitfalls of a State-Dominated Financial System: The Case of China," CEPR Discussion Papers 4471, C.E.P.R. Discussion Papers.
    2. Héricourt, Jérôme & Poncet, Sandra, 2009. "FDI and credit constraints: Firm-level evidence from China," Economic Systems, Elsevier, vol. 33(1), pages 1-21, March.
    3. Hao, Chen, 2006. "Development of financial intermediation and economic growth: The Chinese experience," China Economic Review, Elsevier, vol. 17(4), pages 347-362.
    4. Sandra Poncet & Walter Steingress & Hylke Vandenbussche, 2010. "Financial Constraints in China: the conditioning effect of FDI and State-Owned corporate sector," Post-Print hal-00633806, HAL.
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    Citations

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    Cited by:

    1. Fan, Haichao & Lai, Edwin L.-C. & Li, Yao Amber, 2015. "Credit constraints, quality, and export prices: Theory and evidence from China," Journal of Comparative Economics, Elsevier, vol. 43(2), pages 390-416.
    2. Maria Bas, 2012. "Foreign ownership wage premium: Does financial health matter?," Working Papers 2012-24, CEPII research center.
    3. Goksel, Turkmen, 2012. "Financial constraints and international trade patterns," Economic Modelling, Elsevier, vol. 29(6), pages 2222-2225.
    4. Yao Amber Li & Albert Park & Chen Zhao, 2015. "Credit Distribution and Exports: Microeconomic Evidence from China," HKUST IEMS Working Paper Series 2015-31, HKUST Institute for Emerging Market Studies, revised Nov 2015.
    5. Brian Tavonga Mazorodze, 2024. "Access to finance and intra-Africa trade efficiency," Journal of Shipping and Trade, Springer, vol. 9(1), pages 1-14, December.
    6. Bas, Maria & Causa, Orsetta, 2013. "Trade and product market policies in upstream sectors and productivity in downstream sectors: Firm-level evidence from China," Journal of Comparative Economics, Elsevier, vol. 41(3), pages 843-862.

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    More about this item

    Keywords

    Export performance; Credit constraints; Financial liberalization; FDI;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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