@article{9267eabaf1eb44598fc54a3a70dccb38,
title = "Financial openness and firm exports: Evidence from Foreign-owned Banks in China",
abstract = "Firms involved in international trade require an active and efficient financial market to facilitate their credit services and this is enhanced by financial openness. This study identified the impact of financial openness on Chinese firms' exports by 386 foreign-owned banks in China from 1996 to 2019 as a quasi-natural experiment. We constructed an estimation technique that combines the parallel trend test (PTT) and propensity score matching (PSM) with difference-in-difference (DID) estimators. We found that the gross and selection effects of financial openness are positive, and significantly increase firms' exports by 27.5%. Moreover, the impact differs for various firms: in terms of scale, small and micro firms benefit the most, and in terms of industry, manufacturing firms achieve the highest growth. Additionally, foreign-owned banks reduce firms' transaction costs and production expenditures, while increasing their total factor productivity (TFP) and credit alternatives.",
keywords = "Financial openness, Exports, Quasi -natural experiment, Foreign -owned bank, TRADE OPENNESS, INSTITUTIONS, SELECTION, MARKETS, GROWTH, ENTRY, COST",
author = "C.F. Lyu and Z.H. Xiao and Y. Pu",
note = "Funding Information: We gratefully acknowledge financial support from the Major Project of {"}Chengdu-Chongqing Region Double City Economic Circle Construction{"} (No. SC22ZDCY06 ), the Social Science Planning Major Project of Sichuan and Chongqing , the Chinese National Funding of Social Sciences (No. 22XJL005 ), the Major Program of National Fund of Philosophy and Social Science of China (Nos. 22AZD121 , 22AZD041 ), the National Natural Science Foundation of China (Nos. 72033007 , 72141301 ), the Guanghua One-hundred Scholar Project of Guanghua Meritocrat Engineering in Southwestern University of Finance and Economics , the Platform for Modern Financial Theory with Chinese Characteristics in Southwestern University of Finance and Economics . Funding Information: We gratefully acknowledge financial support from the Major Project of “Chengdu-Chongqing Region Double City Economic Circle Construction” (No. SC22ZDCY06), the Social Science Planning Major Project of Sichuan and Chongqing, the Chinese National Funding of Social Sciences (No. 22XJL005), the Major Program of National Fund of Philosophy and Social Science of China (Nos. 22AZD121, 22AZD041), the National Natural Science Foundation of China (Nos. 72033007, 72141301), the Guanghua One-hundred Scholar Project of Guanghua Meritocrat Engineering in Southwestern University of Finance and Economics, the Platform for Modern Financial Theory with Chinese Characteristics in Southwestern University of Finance and Economics. Publisher Copyright: {\textcopyright} 2023 Elsevier Inc.",
year = "2023",
month = may,
day = "1",
doi = "10.1016/j.irfa.2023.102614",
language = "English",
volume = "87",
journal = "International Review of Financial Analysis",
issn = "1057-5219",
publisher = "Elsevier Inc.",
}