Nottingham Centre for Research on
Globalisation and Economic Policy (GEP)

GEP Research Paper 08/03

Multinationals, Access to Finance and the Exports of Private Firms in China

Jun Du and Sourafel Girma

Summary

The paper examines the relationship between access to finance, FDI and firm exports in China, and shows that   access to finance is much more important for exports, especially for politically unaffiliated firms.

Abstract

Using a rich panel data set, we provide a rigorous analysis of the relationship between access to external finance, foreign direct investment and the exports of private enterprises in China. We conclude that, in order to foster the exports of indigenous enterprises, the elimination of financial discrimination against private firms is likely to be a more effective policy tool than the reliance on spillovers from multinational firms.

Issued in January 2008

This paper is available in PDF format

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