Author : Franklin Allen
Release : 2011
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Comparing China's Financial System - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Comparing China's Financial System write by Franklin Allen. This book was released on 2011. Comparing China's Financial System available in PDF, EPUB and Kindle. We compare China's financial system to those of the developed countries, in particular, the US system dominated by financial markets, and the German system dominated by the banking sector. We examine financial systems' properties, including risk sharing, information provision, funding new and mature industries, financial crisis, corporate governance, and the relation between the financial and legal systems and economic growth. We find that there are many fundamental differences between China's financial system and the US system, and simply adopting the US system is not optimal. Understanding the German system and reform China's banking system should be as important as developing US-style financial markets. Our findings also suggest that China differs from most countries studied in the law, finance, and growth and comparative financial systems literature: Despite its poor legal and financial systems, it has the largest, and one of the fastest growing economies in the world. We find that there are effective, informal financing channels and governance mechanisms to support the growth of various firms in the economy. Therefore, it may be best for China to develop its existing financial system, and to ensure that the informal financing channels and governance mechanisms continue to work along with the development of the legal and financial systems.