a bank-based financial system. However, some scholars find that China has a market-based financial system. This study … tries to resolve this puzzle. Following the definitions of the World Bank, we construct China’s financial structure index … with stock issuance amount, China is bank-based, which aligns with economic intuition …

a large amount of bank loans to local governments through the local government financing vehicles (LGFVs). This allows … us to construct a new and better financial development index which measures the level of loans extended by banks to … form of higher loan to GDP ratio leads to lower economic growth rate. We find that discrimination in bank lending, housing …