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The Financing of Local Government in the People's Republic of China: Stimulus loan Wanes and Shadow Banking Waxes

dc.contributor.authorZhuo Chen
dc.contributor.authorZhiguo He
dc.contributor.authorChun Liu
dc.description.abstractChina’s four-trillion-yuan stimulus package fueled by bank loans in 2009 has led to the rapid growth of shadow banking activities in China after 2012. The local governments in China financed the stimulus plan mainly through bank loans in 2009, and resorted to non-bank debt financing after 2012 given the mounting rollover pressure from bank debt coming due, a manifestation of the stimulusloan-hangover effect. Cross-sectionally, provinces with abnormally greater bank loan growth in 2009 experienced more Municipal Corporate Bonds issuance during 2012-2015, as well as more shadow banking activities including Entrusted loans and Wealth Management Products. We highlight the market forces behind the regulation changes on local government debt post 2012, together with the expedited reform on interest rate liberalization during that period.
dc.publisherAsian Development Bank Institute
dc.titleThe Financing of Local Government in the People's Republic of China: Stimulus loan Wanes and Shadow Banking Waxes
dc.typeWorking Papers
dc.subject.expertPublic Accounting
dc.subject.expertNational Budget
dc.subject.expertMunicipal Bonds
dc.subject.expertLocal Government
dc.subject.expertLocal Taxes
dc.subject.expertInternational Monetary Relations
dc.subject.expertInternational Financial Market
dc.subject.expertInternational Banking
dc.subject.expertCentral Banks
dc.subject.expertBusiness Financing
dc.subject.expertCapital Resources
dc.subject.expertBudgetary Policy
dc.subject.expertCapital Needs
dc.subject.expertCorporate Divestiture
dc.subject.expertCapital Instruments
dc.subject.expertPension Funds
dc.subject.expertInsurance Companies
dc.subject.expertPortfolio Management
dc.subject.expertFiscal Administration
dc.subject.expertEconomics of Education
dc.subject.expertDevelopment Banks
dc.subject.expertScaling-Up And Evaluation
dc.subject.expertResults-Based Monitoring And Evaluation
dc.subject.expertPublic Policy Evaluation
dc.subject.expertImpact Evaluation
dc.subject.expertPerformance Evaluation
dc.subject.adbUrban Development Finance
dc.subject.adbTrade Finance
dc.subject.adbSmall Business Finance
dc.subject.adbRural Finance
dc.subject.adbRoundtable on International Trade and Finance
dc.subject.adbRegional Development Finance
dc.subject.adbPublic Service Finance
dc.subject.adbPublic Finance
dc.subject.adbProject Finance
dc.subject.adbPrivate Finance
dc.subject.adbNonbank Financing
dc.subject.adbNon-Bank Financial Institutions
dc.subject.adbMunicipal Finance
dc.subject.adbLocal Government Finance
dc.subject.adbLocal Currency Financing
dc.subject.adbLimited Resource Financing
dc.subject.adbInternational Financial Institutions
dc.subject.adbInfrastructure Financing
dc.subject.adbIndustrial Finance
dc.subject.adbGovernment Financial Institutions
dc.subject.adbGovernment Finance
dc.subject.adbFinancing of Infrastructure
dc.subject.adbFinancial Sector Development
dc.subject.adbFinancial Regulation
dc.subject.adbEconomic evaluation
dc.subject.adbEconomic Forecast
dc.subject.adbResources evaluation
dc.subject.adbInput output analysis
dc.subject.adbCost benefit analysis
dc.subject.adbForeign and Domestic Financing
dc.subject.naturalUse tax
dc.subject.naturalTaxing power
dc.subject.naturalState of taxation
dc.subject.naturalTax revenue estimating
dc.subject.naturalTax planning
dc.subject.naturalSpendings tax
dc.subject.naturalSpecial assessments
dc.subject.naturalTax administration and procedure
dc.subject.naturalSales tax
dc.subject.naturalReal property and taxation
dc.subject.naturalProgressive taxation
dc.subject.naturalEffect of taxation on land use
dc.subject.naturalEffect of taxation on labor supply
dc.subject.naturalIntergovernmental tax relations
dc.subject.naturalInheritance and transfer tax
dc.subject.naturalEnergy tax
dc.subject.naturalRisk assessment
dc.subject.naturalEconomic policy
dc.subject.naturalEconomic forecasting
dc.subject.naturalCost effectiveness
dc.subject.naturalParticipatory monitoring and evaluation
dc.title.seriesADBI Working Paper Series
dc.title.volumeNo. 800
dc.contributor.imprintAsian Development Bank Institute
oar.adminregionEast Asia Region
oar.countryPeople's Republic of China
oar.authorChen, Zhuo
oar.authorHe, Zhiguo
oar.authorLiu, Chun

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  • ADBI Working Papers
    The Asian Development Bank Institute (ADBI) Working Paper series is a continuation of the formerly named Discussion Paper series which began in January 2003. The numbering of the papers continued without interruption or change. ADBI was established in 1997 in Tokyo, Japan, to help build capacity, skills, and knowledge related to poverty reduction and other areas that support long-term growth and competitiveness in developing economies in Asia and the Pacific.

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