Home > Publications . Search All . Browse All . Country . Browse PSC Pubs . PSC Report Series

PSC In The News

RSS Feed icon

Bloomberg cites MTF data in story on CDC's anti-smoking ads for e-cigarettes

Bound says notion that foreign students are displacing U.S. students "isn't right"

Prescott says online option for access to court system can help equalize justice

Highlights

U-M ranked #1 in Sociology of Population by USN&WR's "Best Graduate Schools"

PAA 2015 Annual Meeting: Preliminary program and list of UM participants

ISR addition wins LEED Gold Certification

PSC Fall 2014 Newsletter now available

Next Brown Bag

Mon, March 23
Lundberg, State Care of the Elderly & Labor Supply of Adult Children

Refinancing and decentralization: Evidence from China

Publication Abstract

Park, Albert F., and M.G. Shen. 2008. "Refinancing and decentralization: Evidence from China." Journal of Economic Behavior & Organization, 66(3-4): 703-730.

Decentralization can complement market liberalization by strengthening incentives of agents to respond to market signals. However, in China banks centralized lending authority following financial reforms in the mid-1990s. We present 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 weak institutional environments may limit the efficiency of financial intermediation despite financial market liberalization. (c) 2007 Published by Elsevier B.V.

DOI:10.1016/j.jebo.2006.06.013 (Full Text)

Browse | Search : All Pubs | Next