The Impact of Stock Markets on China's Economic Development: Some Preliminary Assessments

Laurenceson, James (2002) The Impact of Stock Markets on China's Economic Development: Some Preliminary Assessments. Discussion Paper No 302, School of Economics, The University of Queensland.

Attached Files (Some files may be inaccessible until you login with your UQ eSpace credentials)
Name Description MIMEType Size Downloads
DP302Jan02.pdf DP302Jan02.pdf application/pdf 202.00KB 6904
Author Laurenceson, James
Title The Impact of Stock Markets on China's Economic Development: Some Preliminary Assessments
School, Department or Centre School of Economics
Institution The University of Queensland
Report Number Discussion Paper No 302
Publication date 2002-01-01
Language eng
Subject 140202 Economic Development and Growth
Abstract/Summary The role that stock markets should be afforded in economic development policy in China is the subject of debate. Some argue that they are essential to reforming state-owned enterprises (SOE's) and overcoming deficiencies in China's credit markets. However, others claim they are not necessary institutions for achieving high levels of economic development and are more likely to be destabilizing. This paper seeks to shed light on the impact that stock markets have had on China's economic development to date. Available data suggests that listing SOE's has been important in terms of raising funds for their reform. However, the corporate governance impact has been ineffectual and stock markets were also an insignificant source of funding for non-state owned firms. Finally, on a macro-level, their impact on the overall level of savings mobilization and the allocative efficiency of capital has been negligible. The policy conclusions are that, firstly, the state should begin trading the shares that it controls, and secondly, non-state owned firms should also be allowed to list.
Keyword Economic development - China
Stock markets - China
References Almanac of China's Finance and Banking (ACFB). (various years) English (EE) and Chinese (CE) editions, Beijing: People's China Publishing House. Aoki, M. (1995) 'Controlling Insider Control: issues in corporate governance in transition economies', in Corporate Governance in Transitional Economies: insider control and the role of banks, in Aoki, M. and, Kim, H. (eds), Washington, D.C: The World Bank, pp. 3-30. Arestis, P. and Demetriades, P. (1997) 'Financial Development and Economic Growth: assessing the evidence', The Economic Journal, 107, pp. 783-799. Atje, R. and Jovanovic, B. (1993) 'Stock Markets and Development', European Economic Review, 37, pp. 632-640. Bonser-Neal, C. and Dewenter, K. (1999) 'Does Financial Market Development Stimulate Savings? Evidence from emerging stock markets', Contemporary Economic Policy, 17. Obtained from an electronic source. China Monthly Statistics (CMS). (various issues) Beijing: China Statistical Information and Consultancy Services Center. Corbett, J. (1994) 'An overview of the Japanese Financial System' in Capital Markets and Corporate Governance, in Dimsdale, N. and Prevezer, M. (eds), Oxford, UK: Clarendon Press, pp. 306-324. Demirguc-Kunt, A. and Levine, R. (1996), 'Stock Markets, Corporate Finance and Economic Growth: an overview', World Bank Economic Review, 10, pp. 223-239. Gregory, N. and Tenev, S. (2001) 'The Financing of Private Enterprise in China', Finance and Development, 38. Obtained from an electronic source. Harris, R. (1997) 'Stock Markets and Development: a reassessment', European Economic Review, 41, pp. 139-146. He, D. (1994) 'The Stock Market and Industrial Performance: lessons from the West for Stock Market Development in China', in China's Economic Reforms: the costs and benefits of incrementalism, in Fan, Q. and Nolan, P. (eds), New York: St. Martins Press, pp. 191-217. Jefferson, G. and Rawski, T. and Zheng, Y. (1996) 'Chinese industrial productivity: trends, measurements issues and recent developments', Journal of Comparative Economics, 23, pp. 146-180. Khan, M. and Senhadji, A. (2000) 'Financial Development and Economic Growth: An Overview', IMF Working Paper No. WP/00/209. Available online at: Laurenceson, J. (2001) 'Stock Market Development in China'. Shimonoseki City University Review, XXXXV, No. 1, pp. 57-65. Levine, R. and Zervos, S. (1998) 'Stock Markets, Banks and Economic Growth', American Economic Review, 88, pp. 537-558. Li, K.W. (1994), Financial Repression and Economic Reform in China, Westport: Praeger. Ma, S. (1995) 'Shareholding System Reform: the Chinese way of privatisation', Communist Economies & Economic Transformation, 7, pp. 159-174. Mayer, C. (1994) 'Stock-markets, Financial Institutions, and Corporate Governance', in Capital Markets and Corporate Governance in Dimsdale, N and Prevezer, M. (eds), Oxford, UK: Clarendon Press, pp. 179-194. Mookerjee, R. and Yu, Q. (1999), 'An Empirical Analysis of Equity Markets in China', Review of Financial Economics, 8. Obtained from an electronic source. OECD. (1995) Financial Market Trends, No. 62, OECD: Paris. Okuda, H. (1990) 'Financial Factors in Economic Development: a study of the financial liberalization policy in the Philippines', Developing Economies, 28, pp. 240-270. People's Bank of China (PBC). (various years) China Financial Outlook (CFO), Beijing: China Financial Publishing House. Popov, V. (1999), 'The Financial System in Russia Compared to other Transitional Economies: the Anglo-American model versus the German-Japanese Model', Comparative Economics Studies, 4. Obtained from an electronic source. Rowstowsi, J. (1995) 'The Banking System, Credit and the Real Sector in Transition Economies' in Banking Reform in Central Europe and the Former Soviet Union in Rowstowsi, J. (ed), Budapest: Central European University Press, pp. 16-41. Scholtens, B. (2000) 'Financial Regulation and Financial System Architecture in Central Europe', Journal of Banking and Finance , 24, pp. 525-553. Singh, A. (1990) 'The Stock Market in a Socialist Economy', The Chinese Economy and its Future, in Nolan, P. and Dong, F. (eds), Oxford: Polity Press, pp. 161-178. Singh, A. (1997) 'Financial Liberalization, Stock Markets and Economic Development', The Economic Journal, 107, pp. 771-782. Singh, A. and Weiss, B. (1998) 'Emerging Stock Markets, Portfolio Capital Flows and Long-term Economic Growth: micro and macroeconomic perspectives', World Development, 26, pp. 607-622. Song, H. and Liu, X. and Romilly, R. (1998) 'Stock Returns and Volatility: an empirical study of Chinese stock markets', International Review of Applied Economics, 12, pp. 129-139. Spencer, M. (1995) 'Securities Markets in China', Finance and Development, 32, pp. 28-31. State Statistical Bureau (SSB). (various years) China Statistical Yearbook (CSY), English (EE) and Chinese (CE) editions, Beijing: China Statistical Publishing House. Su, D. and Fleisher, B. (1998) 'Risk, Return and Regulation in Chinese Stock Markets', Journal of Economics and Business, 50, pp. 239-256. Tam, O.K. (1999) The Development of Corporate Governance in China, Northhampton: Edward Elgar Publishing. Xiang, B. (1998) 'The Reform of China's Large State-Owned Enterprises: the indispensable role of stock markets', in China in the Post-Deng Era in Cheng, J. (ed), Hong Kong: The Chinese University Press, pp. 311-328. Xu, X. and Wang, Y. (1997) 'Ownership Structure, Corporate Performance, and Firm's Performance: the case of Chinese Stock Companies', World Bank Working Paper No. 1794. Available on-line at: Xu, X. and Wang, Y. (1999), 'Ownership Structure and Corporate Governance in Chinese Stock Enterprises', China Economic Review, 10, pp. 75-98. Yao, C. (1998) Stock Market and Futures Market in the People's Republic of China, Hong Kong: Oxford University Press.
Additional Notes ISBN: 14465523

Version Filter Type
Citation counts: Google Scholar Search Google Scholar
Access Statistics: 1094 Abstract Views, 6909 File Downloads  -  Detailed Statistics
Created: Thu, 05 Feb 2004, 10:00:00 EST by Belinda Weaver (EA) on behalf of Marketing, Outreach and Corporate Services