Financial Development Impact On The Dual Margin Of Export For Chinese Enterprises

Based on the framework of heterogeneous firm model,the paper combines the present situation of finance and international trade in China,using relevant theoretical models and empirical approaches to discuss the impacts of financial development to Chinese enterprises export margins,and finally putting forward policy suggestions.The article first reviews publications about finance and global trade,then analyzes the mechanism of influences financial development to Chinese firms' exporting margins.Theoretical analysis reveals that when financial market is incomplete,the external financing constraints enterprises suffered restrains their exporting intensive margin and extensive margin,while financing development could release it.The next section is arranged descriptive statistics including current situation about finance and international trade in China.Then the article created several indexes including financial development size,financial deepening degree based on the framework of heterogeneous firm model to make the empirical analysis,which uses China Industry Business Performance Data between 2001 and 2007 to research how financial development influenced Chinese enterprises exporting margins.Regression results show that the intensive margin is significantly increasing followed by financial development improving,while extensive margin is dramatically restrained.Meanwhile,we also find that obvious differences exists in different regions,industries and ownerships after relevant empirical analysis,different financial development indexes also have differences influencing mechanism among firms exporting margins referred to.According to conclusion made by theoretically and empirically study,the paper proposes policy suggestions afterwards,including the improvement of regional financing development level,the adjustment of credit distribution.Finally,the paper presents the inadequacy through this study.