آیا رقابت بانکی باعث کاهش و یا بدتر شدن محدودیت های اعتباری مواجه شده توسط شرکت های کوچک و متوسط می شود؟ مدارک و شواهد از چین
|کد مقاله||سال انتشار||مقاله انگلیسی||ترجمه فارسی||تعداد کلمات|
|21353||2013||13 صفحه PDF||سفارش دهید||محاسبه نشده|
Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Banking & Finance, Volume 37, Issue 9, September 2013, Pages 3412–3424
Banking competition may enhance or hinder the financing of small and medium-sized enterprises. Using a survey on the financing of such enterprises in China, combined with detailed bank branch information, we investigate how concentration in local banking market affects the availability of credit. We find that lower market concentration alleviates financing constraints. The widespread presence of joint-stock banks has a larger effect on alleviating these constraints, than the presence of city commercial banks, while the presence of state-owned banks has a smaller effect.
The impact of competition in the banking sector on the availability of credit for small- and medium-sized enterprises (SMEs) is a crucial policy and academic question that has again attracted widespread attention in light of global economic developments including the subprime crisis. Formal (bank) financing is associated with economic growth (Beck et al., 2005), while SMEs are often constrained in obtaining it (Beck et al., 2008). Yet the determinants of this “financing gap” for SMEs have not yet been fully examined, in particular in the context of a developing financial system such as China. Competition in the banking sector, for example, may be an important driver (Petersen and Rajan, 1995 and Carbo-Valverde et al., 2009). The Chinese government has long recognized the difficulties SMEs face in obtaining financing and it has tried to help them in getting bank loans. SME financing was even added to the national development agenda, which in 2003 resulted in the “SMEs Promotion Law”. However, SME financing difficulties may have never been fully solved by the implemented government policies. Therefore, to understand the determinants of SME financing in China is vitally important not only for academics but also for policy-makers. To investigate the impact of competition in the banking sector on the availability of credit to SMEs in a developing economy, we employ the nearly 4000 responses to a unique stratified survey that was sent to Chinese private enterprises in 2006 (mainly SMEs according to the extant official definition in the Chinese law). China provides an almost ideal setting to investigate the banking competition – SME financing gap nexus. China’s economy is populated with a very large number of SMEs, which contribute substantially to the national economy.1 At the same time SMEs in China are known to face major obstacles in their access to financing, not only from the state-owned banks, but also from other types of formal financing (Ayyagari et al., 2010 and Cheng and Degryse, 2010a). We test the Information Hypothesis versus the Market Power Hypothesis with respect to the effect of banking competition on credit availability. On the one hand, in the information hypothesis fiercer competition may make it more difficult for banks to internalize the benefit of assisting opaque firms which in turn leads to more credit constraints ( Petersen and Rajan, 1995). On the other hand, under the benchmark of market power hypothesis more competition in the banking market reduces the interest rate and hence increases the availability of credit to all firms irrespective of their opacity ( Carbo-Valverde et al., 2009). We find that financing constraints are alleviated in those regions where banking markets are less concentrated, irrespective of whether concentration is measured by the Herfindahl–Hirschman Index (HHI) or the three-bank concentration ratio (CR3) based on bank branch presence. An analysis of the heterogeneous effect of the HHI according to the presence of the different types of banks, namely the state-owned banks (national banks), joint-stock banks (regional banks) and city commercial banks (local banks), shows that the widespread, i.e., “un-concentrated”, presence of joint-stock banks better alleviates credit constraints as compared to the presence of city commercial banks or state-owned banks. The results basically support the validity of the market power hypothesis for China. This paper contributes to the literature by providing evidence on the effect of banking sector concentration (intended to measure the intensity of competition) on SME credit constraints in China. It is also the first study of its kind on emerging economies. For this purpose, we augment the survey with a new dataset of bank branches across China and employ a quantitative measure called the ratio of financing gap over credit demand to capture the information of credit constraints. The new measure is by nature more informative than traditionally used qualitative measures of credit rationing. The rest of the paper is organized as follows. Section 2 gives an introduction of China’s banking system and SME financing. Section 3 presents the dataset. Section 4 introduces the measures of the financing gap, the tested hypotheses and the methodology. Section 5 discusses the summary statistics for the variables of interest. Section 6 presents the estimates and establishes the economic importance of banking competition. Section 7 shows the instrumental variable regression. Section 8 conducts robustness checks. Section 9 concludes the paper.
نتیجه گیری انگلیسی
Banking competition can enhance SME financing by reducing both the probability of the presence and the magnitude of the credit constraints. While there is substantial evidence in the literature on the probability of the presence of credit constraints, little evidence has been reported so far concerning the magnitude of these constraints. Using a survey dataset on Chinese SMEs, we investigate how banking competition contributes to alleviating credit constraints both in terms of the probability that SMEs face credit constraints and in terms of the magnitude of the credit constraints they face. On the one hand, we find that more intense banking competition is associated with a lower probability that SMEs face credit constraints, a finding that is robust to the different choices of concentration measurement and to instrumental variable estimation. On the other hand, more intense banking competition is also associated with a lower level of financing gap ratio, a finding we think that has almost never been reported before in the empirical literature. Moreover, we find that the joint-stock banks have a larger effect, while the state-owned banks have a smaller effect, than city commercial banks in reducing the probability SMEs that face credit constraints and on the magnitude of the credit constraints. Put differently, banking competition by different types of banks can lead to heterogeneous effects on the credit constraints faced by SMEs. While the information hypothesis predicts that creditors are more likely to finance credit constrained firms when credit markets are concentrated (Bergstresser, 2010, Fischer, 2000 and Petersen and Rajan, 2002), our evidence from China supports the market power hypothesis. Due to the difficulty in internalizing the benefit of relationship lending in a developing economy, transaction lending toward SMEs could be more common among banks. Our evidence from China casts doubts on the relationship between banking market structure and credit constraints in emerging markets with similarly high economic growth and poor financial systems, where more intense banking competition seems to help in alleviating SME credit constraints. In order to support SMEs in emerging economics such as China, a potential policy implication is to promote regional banks which have both the business orientation toward SMEs and the proper regional diversification. While the paper examines credit constraints from the quantity perspective, it is interesting to investigate how banking competition affects loan pricing. The interest rate profile may capture the mechanism of how banking competition affects credit constraints, say the relationship lending versus price channel. As there is no price information in this dataset, we leave such an investigation for future research with other new datasets.