1 Introduction
2 The official credit landscape
2.1 Supply and demand of official credit
2.2 Chinese finance
3 Variation in transparency across Chinese and western credit
3.1 Macroeconomic transparency
3.2 Variation in transparency across official Chinese and western lenders
4 Hypothesis: borrower transparency affects Chinese and western credit flows
4.1 Lenders and transparency
4.2 Borrowers and transparency
4.3 Hypothesis
-
H1: Less-transparent governments are likely to obtain more Chinese vis-a-vis Western official credit.
5 Empirical analysis
5.1 Data
5.1.1 Dependent variables
5.1.2 Explanatory variable
5.1.3 Control variables
Variable | Mean | Min | Max | SD |
---|---|---|---|---|
Dependent Variables | ||||
ChnFinance_PerTotal | 0.17 | 0.00 | 1.00 | 0.28 |
ChnFinance_PerTotalNoIMF | 0.18 | 0.00 | 1.00 | 0.29 |
ChnFinance_vsAllWestNoIMF | 0.18 | 0.00 | 1.00 | 0.30 |
ChnFinance_vsOECDBilateralOnly | 0.40 | 0.00 | 1.00 | 0.44 |
Explanatory Variable | ||||
Transparency | 1.84 | -1.22 | 8.22 | 1.91 |
Macro & Public Finance Controls | ||||
GDPpcap | 3473.51 | 194.87 | 14,374.37 | 3013.93 |
GDPgrowth | 4.68 | -8.86 | 18.29 | 3.43 |
BondDummy | 0.45 | 0.00 | 1.00 | 0.50 |
SovDebtCrisis | 0.05 | 0.00 | 1.00 | 0.21 |
Pol-Econ Ties to China & West Controls | ||||
ln_ImpsFromChn | 6.20 | 1.36 | 10.62 | 1.92 |
ln_ExpsToChn | 5.12 | 0.00 | 10.55 | 2.68 |
PTAwChn | 0.13 | 0.00 | 1.00 | 0.33 |
TaiwanRecog | 0.11 | 0.00 | 1.00 | 0.32 |
OilDummy | 0.65 | 0.00 | 1.00 | 0.48 |
agreeUS | 0.29 | 0.11 | 0.81 | 0.10 |
Political and Borrowing Preference Controls | ||||
Democracy | 0.52 | 0.13 | 0.92 | 0.20 |
Corruption | 0.61 | 0.13 | 0.93 | 0.21 |
Left | 0.31 | 0.00 | 1.00 | 0.46 |
TariffRate | 11.86 | 0.78 | 40.91 | 5.78 |
5.1.4 AidData’s Chinese lending data over time
5.2 Models
5.3 Results
5.3.1 Baseline models
DV | All Credit Sources | No IMF | OECD Bilat & Non-IMF Multilat | OECD Bilateral Only | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Model # | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 |
Transparency | -0.166*** | -0.176** | -0.142** | -0.193*** | -0.171** | -0.140** | -0.185*** | -0.186*** | -0.152** | -0.290*** | -0.179* | -0.115* |
(0.023) | (0.056) | (0.048) | (0.024) | (0.056) | (0.047) | (0.023) | (0.056) | (0.049) | (0.026) | (0.070) | (0.047) | |
DVlag | 0.796*** | 0.808*** | 0.768*** | 1.133*** | ||||||||
(0.195) | (0.182) | (0.203) | (0.191) | |||||||||
GDPpcap | 0.000*** | 0.000** | 0.000** | 0.000* | 0.000*** | 0.000*** | 0.000 | 0.000 | ||||
(0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | |||||
GDPgrowth | -0.013 | -0.015 | -0.012 | -0.015 | -0.015 | -0.016 | -0.018 | -0.019 | ||||
(0.017) | (0.015) | (0.016) | (0.015) | (0.017) | (0.017) | (0.016) | (0.017) | |||||
BondDummy | -0.366** | -0.256* | -0.350** | -0.241* | -0.363** | -0.258* | -0.471** | -0.307* | ||||
(0.119) | (0.101) | (0.117) | (0.098) | (0.126) | (0.111) | (0.149) | (0.129) | |||||
SovDebtCrisis | -0.265 | -0.098 | -0.110 | 0.029 | -0.318 | -0.287 | -0.278 | -0.405 | ||||
(0.234) | (0.204) | (0.274) | (0.216) | (0.273) | (0.222) | (0.380) | (0.244) | |||||
ln_ImpsFromChn | -0.078 | -0.068 | -0.079 | -0.059 | -0.085 | -0.082 | -0.143 | -0.143* | ||||
(0.070) | (0.056) | (0.069) | (0.057) | (0.072) | (0.058) | (0.092) | (0.065) | |||||
ln_ExpsToChn | 0.154*** | 0.140*** | 0.153*** | 0.138*** | 0.163*** | 0.151*** | 0.219*** | 0.184*** | ||||
(0.045) | (0.035) | (0.044) | (0.034) | (0.045) | (0.036) | (0.057) | (0.040) | |||||
PTAwChn | -0.033 | -0.028 | -0.038 | -0.050 | -0.089 | -0.055 | -0.374 | -0.162 | ||||
(0.213) | (0.181) | (0.221) | (0.189) | (0.219) | (0.183) | (0.276) | (0.185) | |||||
TaiwanRecog | -1.463*** | -1.222** | -1.518*** | -1.266*** | -1.696*** | -1.427*** | -2.903*** | -1.846*** | ||||
(0.384) | (0.372) | (0.390) | (0.376) | (0.433) | (0.421) | (0.473) | (0.434) | |||||
OilDummy | -0.387 | -0.348* | -0.416 | -0.386* | -0.495* | -0.433* | -1.104*** | -0.777*** | ||||
(0.210) | (0.174) | (0.213) | (0.176) | (0.216) | (0.176) | (0.291) | (0.204) | |||||
agreeUS | 1.092 | 1.026 | 1.310 | 1.329 | 1.065 | 0.931 | 1.050 | 1.355 | ||||
(1.122) | (0.929) | (1.104) | (0.907) | (1.080) | (0.883) | (1.358) | (1.055) | |||||
Democracy | -0.904 | -0.691 | -0.873 | -0.654 | -1.011 | -0.776 | 0.014 | -0.140 | ||||
(0.533) | (0.425) | (0.526) | (0.420) | (0.547) | (0.438) | (0.513) | (0.372) | |||||
Corruption | -0.303 | -0.155 | -0.280 | -0.147 | -0.148 | -0.058 | -0.107 | -0.297 | ||||
(0.448) | (0.363) | (0.440) | (0.360) | (0.435) | (0.353) | (0.494) | (0.347) | |||||
Left | 0.062 | 0.068 | 0.091 | 0.090 | 0.105 | 0.081 | 0.020 | -0.054 | ||||
(0.128) | (0.104) | (0.129) | (0.104) | (0.136) | (0.112) | (0.171) | (0.122) | |||||
TariffRate | -0.015 | -0.010 | -0.012 | -0.007 | -0.019 | -0.013 | -0.003 | 0.003 | ||||
(0.014) | (0.011) | (0.014) | (0.012) | (0.015) | (0.012) | (0.016) | (0.012) | |||||
N | 873 | 590 | 579 | 870 | 589 | 577 | 868 | 589 | 577 | 789 | 556 | 510 |
Year Effects | NO | YES | YES | NO | YES | YES | NO | YES | YES | NO | YES | YES |
Unit-Cluster Robust St. Errors | NO | YES | YES | NO | YES | YES | NO | YES | YES | NO | YES | YES |
5.3.2 Imputed HRV models
DV | All Credit Sources | No IMF | OECD Bilat & Non-IMF Multilat | OECD Bilateral Only | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Model # | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 |
Transparency | -0.090*** | -0.130* | -0.106* | -0.112*** | -0.125* | -0.103* | -0.110*** | -0.143* | -0.115* | -0.206*** | -0.166* | -0.108* |
(0.018) | (0.059) | (0.048) | (0.018) | (0.059) | (0.048) | (0.018) | (0.059) | (0.047) | (0.019) | (0.067) | (0.044) | |
DVlag | 0.878*** | 0.876*** | 0.884*** | 1.164*** | ||||||||
(0.146) | (0.147) | (0.146) | (0.150) | |||||||||
GDPpcap | 0.000** | 0.000* | 0.000* | 0.000* | 0.000** | 0.000** | 0.000 | 0.000 | ||||
(0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | |||||
GDPgrowth | -0.012 | -0.012 | -0.011 | -0.011 | -0.009 | -0.009 | -0.009 | -0.011 | ||||
(0.011) | (0.010) | (0.011) | (0.010) | (0.012) | (0.011) | (0.012) | (0.013) | |||||
BondDummy | -0.318** | -0.227** | -0.309** | -0.218* | -0.307** | -0.212* | -0.430** | -0.258* | ||||
(0.107) | (0.088) | (0.107) | (0.088) | (0.109) | (0.090) | (0.132) | (0.107) | |||||
SovDebtCrisis | -0.266 | -0.127 | -0.148 | -0.037 | -0.342 | -0.274 | -0.223 | -0.373 | ||||
(0.189) | (0.163) | (0.226) | (0.180) | (0.217) | (0.167) | (0.265) | (0.223) | |||||
ln_ImpsFromChn | -0.017 | -0.011 | -0.017 | -0.008 | -0.040 | -0.032 | -0.023 | -0.032 | ||||
(0.062) | (0.048) | (0.062) | (0.050) | (0.065) | (0.052) | (0.086) | (0.060) | |||||
ln_ExpsToChn | 0.154*** | 0.127*** | 0.147** | 0.122*** | 0.157*** | 0.130*** | 0.146** | 0.108** | ||||
(0.045) | (0.034) | (0.045) | (0.035) | (0.045) | (0.034) | (0.048) | (0.035) | |||||
PTAwChn | -0.241 | -0.162 | -0.229 | -0.159 | -0.249 | -0.161 | -0.358 | -0.172 | ||||
(0.196) | (0.160) | (0.205) | (0.167) | (0.198) | (0.158) | (0.230) | (0.160) | |||||
TaiwanRecog | -1.432*** | -1.160*** | -1.442*** | -1.148*** | -1.545*** | -1.249*** | -1.941*** | -1.090*** | ||||
(0.288) | (0.265) | (0.282) | (0.260) | (0.305) | (0.278) | (0.311) | (0.274) | |||||
OilDummy | -0.323 | -0.261 | -0.328 | -0.274* | -0.308 | -0.255 | -0.678** | -0.443** | ||||
(0.176) | (0.136) | (0.179) | (0.138) | (0.185) | (0.140) | (0.236) | (0.165) | |||||
agreeUS | -0.782 | -0.509 | -0.642 | -0.319 | -1.119 | -0.806 | -0.541 | -0.077 | ||||
(0.814) | (0.647) | (0.804) | (0.647) | (0.812) | (0.647) | (0.952) | (0.697) | |||||
Democracy | -0.559 | -0.391 | -0.551 | -0.377 | -0.750 | -0.509 | 0.029 | -0.071 | ||||
(0.453) | (0.333) | (0.447) | (0.332) | (0.459) | (0.343) | (0.477) | (0.340) | |||||
Corruption | -0.272 | -0.166 | -0.239 | -0.151 | -0.284 | -0.175 | 0.004 | -0.028 | ||||
(0.407) | (0.310) | (0.399) | (0.304) | (0.408) | (0.310) | (0.439) | (0.309) | |||||
Left | -0.014 | 0.006 | 0.020 | 0.030 | 0.036 | 0.021 | 0.122 | 0.065 | ||||
(0.116) | (0.089) | (0.115) | (0.090) | (0.116) | (0.091) | (0.130) | (0.093) | |||||
TariffRate | 0.001 | 0.002 | 0.002 | 0.003 | -0.003 | -0.001 | 0.002 | 0.001 | ||||
(0.014) | (0.011) | (0.014) | (0.011) | (0.014) | (0.011) | (0.016) | (0.012) | |||||
N | 1359 | 1013 | 998 | 1353 | 1009 | 991 | 1353 | 1011 | 995 | 1240 | 944 | 869 |
Year Effects | NO | YES | YES | NO | YES | YES | NO | YES | YES | NO | YES | YES |
Unit-Cluster Robust St. Errors | NO | YES | YES | NO | YES | YES | NO | YES | YES | NO | YES | YES |
5.3.3 Hierarchical random effect models
Transparency Values | Raw HRV Only | Imputed HRV | ||||||
---|---|---|---|---|---|---|---|---|
DV | All | No IMF | Western Only, No IMF | OECD Bilateral Only | All | No IMF | Western Only, No IMF | OECD Bilateral Only |
Model # | 25 | 26 | 27 | 28 | 29 | 30 | 31 | 32 |
Transparency | -0.025** | -0.025** | -0.027** | -0.043*** | -0.022** | -0.022** | -0.026*** | -0.050*** |
(0.008) | (0.008) | (0.008) | (0.001) | (0.007) | (0.007) | (0.007) | (0.013) | |
DVlag | 0.301*** | 0.305*** | 0.305*** | 0.281*** | 0.321*** | 0.318*** | 0.334*** | 0.217*** |
(0.058) | (0.056) | (0.056) | (0.058) | (0.042) | (0.041) | (0.041) | (0.036) | |
GDPpcap | 0.000** | 0.000* | 0.000** | 0.000** | 0.000*** | 0.000** | 0.000*** | 0.000*** |
(0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | (0.000) | |
GDPgrowth | -0.004 | -0.004 | -0.004 | -0.004 | -0.003 | -0.003 | -0.003 | -0.002 |
(0.004) | (0.004) | (0.004) | (0.008) | (0.003) | (0.003) | (0.003) | (0.007) | |
BondDummy | -0.049* | -0.047 | -0.051* | -0.096** | -0.055** | -0.054** | -0.053** | -0.071*** |
(0.023) | (0.025) | (0.024) | (0.032) | (0.020) | (0.021) | (0.020) | (0.013) | |
SovDebtCrisis | -0.015 | 0.013 | -0.056 | -0.070*** | -0.022 | -0.001 | -0.054 | -0.104*** |
(0.059) | (0.063) | (0.056) | (0.017) | (0.052) | (0.056) | (0.051) | (0.023) | |
ln_ImpsFromChn | -0.023* | -0.021* | -0.026* | -0.038** | -0.002 | -0.002 | -0.006 | -0.013 |
(0.010) | (0.011) | (0.010) | (0.012) | (0.008) | (0.008) | (0.008) | (0.013) | |
ln_ExpsToChn | 0.027*** | 0.026*** | 0.029*** | 0.042*** | 0.026*** | 0.027*** | 0.028*** | 0.025** |
(0.007) | (0.007) | (0.007) | (0.005) | (0.006) | (0.006) | (0.006) | (0.008) | |
PTAwChn | -0.006 | -0.015 | -0.010 | -0.052 | -0.035 | -0.038 | -0.033 | 0.018 |
(0.036) | (0.038) | (0.036) | (0.027) | (0.030) | (0.031) | (0.031) | (0.031) | |
TaiwanRecog | -0.108*** | -0.120*** | -0.126*** | -0.372*** | -0.102*** | -0.108*** | -0.107*** | -0.328*** |
(0.026) | (0.027) | (0.028) | (0.039) | (0.021) | (0.021) | (0.022) | (0.001) | |
OilDummy | -0.040 | -0.047* | -0.057* | -0.209*** | -0.048* | -0.052* | -0.047* | -0.143*** |
(0.023) | (0.024) | (0.025) | (0.044) | (0.022) | (0.022) | (0.023) | (0.042) | |
Democracy | -0.188** | -0.179** | -0.209*** | -0.029 | -0.133* | -0.127* | -0.174*** | -0.042 |
(0.061) | (0.062) | (0.062) | (0.020) | (0.052) | (0.053) | (0.053) | (0.077) | |
Corruption | -0.012 | -0.014 | 0.001 | -0.038* | -0.028 | -0.028 | -0.041 | 0.034 |
(0.056) | (0.057) | (0.059) | (0.016) | (0.043) | (0.044) | (0.045) | (0.155) | |
Left | 0.008 | 0.011 | 0.012 | 0.004* | 0.012 | 0.014 | 0.018 | 0.051 |
(0.023) | (0.023) | (0.023) | (0.002) | (0.018) | (0.019) | (0.019) | (0.035) | |
TariffRate | -0.004 | -0.003 | -0.004 | -0.001*** | 0.001 | 0.001 | 0.000 | 0.003 |
(0.002) | (0.002) | (0.002) | (0.000) | (0.002) | (0.002) | (0.002) | (0.004) | |
N | 579 | 577 | 577 | 510 | 998 | 991 | 995 | 869 |
Year Effects | YES | YES | YES | YES | YES | YES | YES | YES |
Unit-Cluster Robust St. Errors | YES | YES | YES | YES | YES | YES | YES | YES |