A Refinancing Model of Decentralization with Empirical Evidence from China
dc.contributor.author | Park, Albert | en_US |
dc.contributor.author | Shen, Minggao | en_US |
dc.date.accessioned | 2006-08-01T16:06:13Z | |
dc.date.available | 2006-08-01T16:06:13Z | |
dc.date.issued | 2002-04-01 | en_US |
dc.identifier.other | RePEc:wdi:papers:2002-461 | en_US |
dc.identifier.uri | https://hdl.handle.net/2027.42/39845 | en_US |
dc.description.abstract | Decentralization can complement market liberalization by strengthening incentives of agents to exploit local information in response to market signals. In China, however, banks centralized lending authority following financial reforms in the mid-1990s. We offer a new theory of financial decentralization in which centralization provides a credible commitment not to refinance bad projects by reducing available information. Using data from Chinese rural financial institutions, we empirically assess the determinants of decentralization and the likelihood of collateral seizure, strongly confirming the predictions of the refinancing model. We conclude that the inability of financial systems to exploit local information in weak institutional environments may limit the efficiency of financial intermediation despite financial market liberalization. | en_US |
dc.format.extent | 99635 bytes | |
dc.format.extent | 3151 bytes | |
dc.format.extent | 223407 bytes | |
dc.format.mimetype | text/plain | |
dc.format.mimetype | text/plain | |
dc.format.mimetype | application/pdf | |
dc.language.iso | en_US | en_US |
dc.relation.ispartofseries | 461 | en_US |
dc.subject | Banking, Decentralization, Refinancing, Transition, China | en_US |
dc.subject.other | G2, D8, P3 | en_US |
dc.title | A Refinancing Model of Decentralization with Empirical Evidence from China | en_US |
dc.type | Working Paper | en_US |
dc.subject.hlbsecondlevel | Economics | en_US |
dc.subject.hlbtoplevel | Business | en_US |
dc.description.bitstreamurl | http://deepblue.lib.umich.edu/bitstream/2027.42/39845/3/wp461.pdf | en_US |
dc.owningcollname | William Davidson Institute (WDI) - Working Papers |
Files in this item
Remediation of Harmful Language
The University of Michigan Library aims to describe library materials in a way that respects the people and communities who create, use, and are represented in our collections. Report harmful or offensive language in catalog records, finding aids, or elsewhere in our collections anonymously through our metadata feedback form. More information at Remediation of Harmful Language.
Accessibility
If you are unable to use this file in its current format, please select the Contact Us link and we can modify it to make it more accessible to you.