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Purpose: This study provides a bibliometric analysis of bank efficiency and competition over the past years (from 1993 to 2022) to (1) discover the past and current state of knowledge on bank competition and efficiency, (2) identify leading and authoritative journals and scholars who made significant contributions to the distribution of knowledge and impact, (3) identify nations that made a significant contribution and impact to the literature and (4) identify the structure of collaboration that exists between scholars in the areas of bank competition and efficiency and key thematic areas. Design/methodology/approach: A total number of 868 documents made up of articles, reviews, book chapters, book and conference papers from the Scopus database were gathered. This study used a bibliometric analytic approach. Findings: The number of documents on bank competitiveness and efficiency has increased significantly, as have their total publications, citations and national output. Additionally, the most esteemed and prestigious academic journals of eminent academics who have had a significant impact on the dissemination of knowledge on bank efficiency and competition literature champion papers on banking efficiency and competition. In terms of citation performance and collaborative efforts, the United States tops the developed countries, led by China, which is also the most productive. Additionally, single-country publications predominate in the literature, with China ranking first among the top five countries with corresponding authors. While the Lerner index, H-statistic, concentration index and market power were used to measure bank competitive behaviour, the data envelopment analysis approach predominates efficiency estimation techniques that are linked to cost, profit or revenue, scale, technical and productivity indexes. Originality/value: This study is one of the first to offer bibliometric evidence of both bank competition and efficiency. It also offers proof of the distribution of knowledge and intellectual structure of the concepts and concerns in bank competition and efficiency. [ABSTRACT FROM AUTHOR]

Purpose: This paper explores international trade of the Chinese manufacturing industries through the lenses of network analysis (NA) to visualise the world trade network of the Chinese economy, describe its topology and better explain the international organisation of Chinese manufacturing industries. Design/methodology/approach: The authors built a dataset of 40,550 Chinese companies and their 107,026 subsidiaries in 118 countries from Orbis-BVD and used a NA to investigate the connection between China and other countries. In particular, the authors studied the connections between Chinese companies and their subsidiaries in order to build a network of Chinese industries. Findings: The authors found that the network of Chinese companies is ramified but not wide and it can be divided into two clusters. Moreover, the relations between China and other peripheral countries are strongly mediated by a few leading locations (e.g. Hong Kong and the USA). Originality/value: This paper contributes to the literature in several ways. First, the authors provide empirical evidence on the magnitude and ramifications of Chinese enterprises in the world. The existing studies generally focus on applying NA to sectoral insights (Mao and Yang, 2012; Shaikh et al., 2016; Zheng et al., 2016; Wanzenbö ck, 2018; Krichene et al., 2019), whereas in this work the authors take a comprehensive view of the entire Chinese manufacturing system. Second, this paper complements the existing literature identifying the difference between cluster levels in Chinese manufacturing (Wu and Jiang, 2011) by proposing a cluster centralisation method to analyse the international network of Chinese firms rather than just the national network. Finally, the results also shed light on the international trade relationship between China, Hong Kong and the USA. [ABSTRACT FROM AUTHOR]

Purpose: The authors study the effectiveness of the anti-corruption campaign in all of mainland China's provinces in terms of risk and volatility spillovers. Design/methodology/approach: A nonlinear model describes interdependencies and determines how shocks and uncertainty spillovers from the first suspects to the rest of the country are dynamically transmitted. Findings: The authors find that both idiosyncratic and systematic risk increase after the first investigation, suggesting that investors do react to the political shocks induced by the new policy. However, even if the scope of the inquiry expands, as the current policy is almost certain to be maintained, investors do not need to update their beliefs, stock news about their political costs does not matter and shocks cease to spread. Originality/value: In this paper, the authors contribute to the literature by examining the financial effects of China's anti-corruption campaign and determining whether such a large-scale campaign affects risk. Qian and Wen (2015) and Ke et al. (2016) show that the anticorruption campaign has a negative impact on the consumption of luxury goods. Agarwal et al. (2020) provide evidence that government officials' access to credit decreases following the anti-corruption campaign. According to Zhang (2018), firms are less prone to commit fraud after the anti-corruption campaign. However, Griffin et al. (2018) find little evidence that the anti-corruption campaign reduces corporate corruption. Kim et al. (2018) assess market reaction during the investigation and discover that the anti-corruption examination has a significant positive influence on Chinese financial markets. The authors intend to fill the gap in the literature concerning the campaign's impact on risk and volatility spillovers across the country during the first stage of the campaign. [ABSTRACT FROM AUTHOR]

Purpose: The quality of exports is an important indicator of the economic development of a country. It is, therefore, important to understand its determinants. Existing literature reveals a number of determinants such as the position of a country, the distance to the trading partner, the size of the firm and the productivity or the quality of inputs. In this study, the author proposes a new determinant, namely ethnic diversity. Design/methodology/approach: In the first stage of this research, the author estimates the quality of exports following Berry (1994) approach. The author also addresses the endogeneity problem as suggested by Khandelwal (2010). The author's measure of ethnic diversity follows Easterly and Levine (1997). In the second stage, the author regresses the estimated quality on the measure of ethnic diversity, interacted by the degree of differentiation of the goods. Findings: First, the author finds that ethnic diversity in general reduces the quality of exports. Second, the author finds that the impact varies with the degree of differentiation. In particular, while ethnic diversity decreases the quality of differentiated goods, it increases the quality of homogeneous goods. Research limitations/implications: Because of data limitations, the research cannot investigate the impact of migration. Practical implications: The findings of this paper show how one can improve the quality of products based on the characteristics of the population and of the products. Originality/value: In the last decade, there has been growing attention paid to the impact of ethnic diversity on economic performance. As industrial powerhouses such as China continue to urbanize, stitching together once-disparate ethnic groups, the role ethnic diversity plays in the economic life of a country must be examined from a variety of angles. This paper is the first to investigate the specific impact of that diversity on product quality and on how diversity interacts with the characteristics of products. [ABSTRACT FROM AUTHOR]

Purpose: The quality of exports is an important indicator of the economic development of a country. It is, therefore, important to understand its determinants. Existing literature reveals a number of determinants such as the position of a country, the distance to the trading partner, the size of the firm and the productivity or the quality of inputs. In this study, the author proposes a new determinant, namely ethnic diversity. Design/methodology/approach: In the first stage of this research, the author estimates the quality of exports following Berry (1994) approach. The author also addresses the endogeneity problem as suggested by Khandelwal (2010). The author's measure of ethnic diversity follows Easterly and Levine (1997). In the second stage, the author regresses the estimated quality on the measure of ethnic diversity, interacted by the degree of differentiation of the goods. Findings: First, the author finds that ethnic diversity in general reduces the quality of exports. Second, the author finds that the impact varies with the degree of differentiation. In particular, while ethnic diversity decreases the quality of differentiated goods, it increases the quality of homogeneous goods. Research limitations/implications: Because of data limitations, the research cannot investigate the impact of migration. Practical implications: The findings of this paper show how one can improve the quality of products based on the characteristics of the population and of the products. Originality/value: In the last decade, there has been growing attention paid to the impact of ethnic diversity on economic performance. As industrial powerhouses such as China continue to urbanize, stitching together once-disparate ethnic groups, the role ethnic diversity plays in the economic life of a country must be examined from a variety of angles. This paper is the first to investigate the specific impact of that diversity on product quality and on how diversity interacts with the characteristics of products. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to examine the determinants of foreign direct investment (FDI) in producer services in China using both country aggregate and provincial sub-sectoral data. Design/methodology/approach: This paper applies autoregressive distributed lag (ARDL) cointegration and panel data regression approaches in examining the determinants of Producer Service FDI (PSFDI). Findings: Our results show differences between the determinants of aggregate FDI and PSFDI. Contrary to the typical influencing factors of general FDI (that include GDP, openness, low wages and environmental quality), the two main determinants of PSFDI inflows to China are found to be high wages and research inputs (specifically the number of research workers as a proxy for research intensity). Data drawn from 26 Chinese provinces disaggregated at sub-sector level of producer services corroborate the results. Originality/value: We add to existing literature by identifying the key determinants of inward PSFDI in China also via a provincial-level data analysis and disaggregation at sub-sectoral level of producer services. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to explore the threshold effect of firm size on technological innovation using panel data from 2007 to 2012 for listed enterprises in China's manufacturing sector. Design/methodology/approach: Considering the aim of research question is to examine the nonlinear relationship, this paper utilizes the threshold regression proposed by Hansen's (2000). Findings: Based on a threshold regression model using panel data from 2007 to 2012 for listed enterprises in China's manufacturing sector, we find a series of new results. This nonlinear relationship is under the restrictions and impacts of various factors, such as industry characteristics and government subsidies. The results suggest that the threshold regression model well explains the complicated nonlinear relationship and transition process, and it can also shed light on management practice and policy. Originality/value: There are categorical arguments regarding why firm size is not as effective as before in explaining the monotonic principle of industrial innovation, especially for establishing an effective industrial policy in a particular situation. One of the important reasons is that we have begun to adopt a new perspective from the nonlinear view on the relationship between firm size and industrial innovation. In this study, we have examined the threshold effect of firm size on industrial technological innovation, which is the most representative nonlinear relationship. [ABSTRACT FROM AUTHOR]

Purpose: This paper investigates the impact of credit risk shocks on the evolution of banking efficiency in China. Design/methodology/approach: This paper introduces credit risk as a bad output into a bootstrap data envelopment analysis (bootstrap-DEA) model. Findings: During a credit risk shock, the efficiency levels of both state-owned commercial banks and joint-stock commercial banks are significantly higher than those of urban/rural commercial banks, and the efficiency differences between these banks further increase during a period of economic slowdown. This paper also finds that the efficiencies of joint-stock commercial banks are the most sensitive to credit risk shocks; these banks are the first to be affected and the first to completely adjust. However, urban/rural commercial banks adjust very slowly. Originality/value: Most scholars still use the traditional DEA method to estimate China's banking efficiency. The bootstrap-DEA method is clearly able to obtain a more exact estimated efficiency score. In fact, in comparison with the bootstrap-DEA model, we found that the traditional DEA method overestimates China's banking efficiency, and this is an especially serious problem for those banks that have a high efficiency score. [ABSTRACT FROM AUTHOR]

Purpose: The main purpose of this paper is to analyse the different factors affecting Sino-African trade based on the gravity model, and propose some solutions to improve the problems. Design/methodology/approach: The paper is based on an extended gravity model, including trade agreement and recession as explanatory variables. The impacts of trade agreement and economic recession on Sino-African imports and exports are examined. Findings: The results show that the product of GDP affects African exports to China significantly and negatively, and affects African imports from China positively. Real exchange rate affects African exports to China positively, and affects African imports from China negatively. Population affect African exports to China significantly and positively, and affect African imports from China positively. Recession have negative effects on both African imports from China and exports to China but is only significant for imports. Agreement affects African imports from China and exports to China positively. Our findings confirm the impact of economic recession, and imply that the structure of African product exported to China should be improved, and trade agreements should be reinforced. Originality/value: This paper contributes and extends the literature on Sino-African trade by improving the traditional gravity model to include the impact of all trade agreements, and their aggregating effects on trade. The paper also seeks to assess the trade impact of economic recession through a dynamic gravity model approach for which there has been no research done to our knowledge. In this regard, it provides new understanding of the trade pattern between China and Africa, and ways in improving the Sino-African bilateral trade. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to investigate the effects of Chinese and non-Chinese import penetration on the inter-industry wage premium, and how such effects vary according to the unskilled-labor intensity of the industry and to the implementation of the Nova Matriz Economica policy in 2008. Design/methodology/approach: The paper empirically examines the effects of the Chinese and non-Chinese import penetration on the wage premium using a linear instrumental variables model and data from Brazilian household surveys and censuses. Findings: The estimates show the Chinese import penetration positively affecting the wage premium in unskilled-labor intensive. And the implementation of the new macroeconomic policy strengthened this effect. Originality/value: To the best of the author's knowledge, this is the first paper to study the effects of Chinese and non-Chinese import penetration on the inter-industry wage premium. [ABSTRACT FROM AUTHOR]

Purpose: This paper aims to consider if an initial driver of the cross-country global coronavirus pandemic was trade openness with China. Design/methodology/approach: The authors estimate simple, seemingly unrelated and zero-inflated count data specifications of a gravity model of trade between China and its trading partners, where the number of human coronavirus infections in a country is a function of the number of distinct good/services exported and imported from China. Findings: Parameter estimates reveal that the number of early cross-country human coronavirus infections increased with respect to trade openness with China, as measured by the number of distinct Chinese exported and imported goods/services, and can account for approximately 24% of early infections among China's trading partners. The findings suggest that one of the costs of trade openness and globalization is that they can be a driver of cross-country human disease pandemics. Originality/value: This inquiry constitutes a first approach at embedding the possible disease pandemic costs of free trade, trade openness and globalization within a trade gravity model. [ABSTRACT FROM AUTHOR]

Purpose The purpose of this paper is to examine volatility spillover from the Chinese stock market to E7 and G7 stock markets. Using the estimated results, the authors also analyze the optimal weights and optimal hedge ratios for the portfolios including stocks from E7 and G7 countries.Design/methodology/approach The authors employed generalized vector autoregressive-generalized autoregressive conditional heteroskedasticity approach, developed by Ling and McAleer (2003), in order to analyze daily data on the national stock indices. Considering the late establishment of some E7 stock markets, the sampling covers the period from 1995 through 2015.Findings The findings indicate significant volatility spillover from the Chinese stock market to E7 and G7 stock markets. In particular, the Chinese stocks highly co-move with the stocks of countries within a same geographical region. While the highest volatility spillover occurs between China and India among E7 countries, the highest volatility spillover occurs between China and Japan among G7 countries. Furthermore, the examination of optimal weights and hedge ratios suggest that investors should hold more stocks from G7 countries than E7 countries for their portfolios.Originality/value To the best of the authors' knowledge, this is the first study which investigates the volatility spillover in the stock markets of G7 and E7 countries. Moreover, the current study contributes particularly to the existing limited literature on the Chinese stock market. Since the Chinese stock market is not fully integrated to other markets and it is subject to intense government interventions, there is a widely accepted belief that the contagion effects from the Chinese stock market to other stock markets are not influential. This view discourages and limits the prospect studies. However, the findings of this paper refute this view and indicate significant interaction among the Chinese stock market and E7 and G7 stock markets. [ABSTRACT FROM AUTHOR]

Purpose The purpose of this paper is to analyze the direct and indirect impacts of social organization in promoting Chinese economic growth. It adopts empirical research to test the correlated hypotheses, and tries to put forward some policy suggestions.Design/methodology/approach Social organizations are measured by four indicators in this paper. It proposes five hypotheses about the impact of social organization on economic growth and builds an economic growth model including social organization. The ordinary least squares and stepwise regression methods are conducted to estimate the economic growth model with the data from 1999 to 2015.Findings Through the empirical analysis, it finds that the added value of social organization, human capital, investment and government budget expenditure affect economic growth significantly. The number of social organization at the end of each year has a positive significant effect on entrepreneurship, while the added value and growth rate of it have a negative effect on it. The numbers of social organization and full-time employee have significant effect on number to workers in the labor force. Only the number of social organization has positive significant effect on public education.Originality/value This paper conducts an empirical study on the impact of social organization on economic growth in China and fills a gap of the role of social organization on the economy in developing countries. The results provide referenced information for public policy-making. [ABSTRACT FROM AUTHOR]

Purpose China has shifted its agricultural policy from tax agriculture to support it. The purpose of this paper is to examine the agricultural policy changes of China in recent years, focussing on the support policy. China supports its agriculture sector through tax elimination, area payment and input subsidy. In this paper, the author intends to evaluate China’s agricultural support policy effect with a modified policy evaluation model (PEM).Design/methodology/approach The author modifies PEM used by OECD to estimate the effects of these support policies on production and farmer’s income.Findings The main findings are input subsidy policy has more effect than area payment policy in general; input subsidy policy has more effects on production while area payment has more effects on farmer’s income; and the sensitivity analysis further indicates that input subsidy policy has more influence than area payment as regarding production impact ratio, while area payment has more influence on income impact ratios.Practical implications Based on these findings, when it comes to the support policy in terms of area payment and input subsidies only, the author puts forward the following policy implications: to increase input subsidy in budgets and expand the covering scope, and to continue implementing area payment policy with more budgets. However, support policies playing an important role in improving production efficiency and marketing support should be given priority.Originality/value The main contributions of this paper are modifying the OECD PEM to China’s conditions; and quantifying China’s agricultural policy effects. [ABSTRACT FROM AUTHOR]

Purpose -- The purpose of this paper is to combine multidimensional welfare analysis and entropy metrics to derive not only the best relative weights but also substitution degree among different attributes to construct multidimensional indices of well-being with Chinese Household Income Project Survey 2002 data. Design/methodology/approach -- The authors follow Maasoumi's two-step measures of multivariate inequality to calculate the inequality for three social groups in China, urban residents, migrants, and rural residents. The two-step approach provides an aggregation formula which is numerically identified in this paper based on a metric entropy distance measure between the distribution of the aggregate well-being functions, on the one hand, and the distribution of the self-reported "happiness" indicator. The authors compare the differences in relative weights and substitution degree for the three groups, and link them to some institutional factors. Findings -- The authors find that incorporating substitution among attributes, and taking into consideration group heterogeneity are very important in multidimensional analysis of well-being. Originality/value -- The two-step approach provides an aggregation formula which is numerically identified in this paper based on a metric entropy distance measure between the distribution of the aggregate well-being functions, on the one hand, and the distribution of the self-reported "happiness" indicator. [ABSTRACT FROM AUTHOR]

Purpose – Bilateral trade between Egypt and China has expanded substantially in recent years. Few studies however have focused on the understanding of this trade relationship. The purpose of this paper is to fill a void in the literature by examining and understanding the two countries' trade pattern. Design/methodology/approach – In order to achieve the objectives of the paper, and in the light of the pool of literature and availability of data, the authors relied on qualitative methods to analyze the composition of trade between Egypt and China. In addition, the authors employed trade intensity index, intra-industry trade index, and examined the trade complementarity to capture the dynamics and perspectives of bilateral trade between the two countries. Findings – Results show low values in Egypt's trade intensity index, implying that Egyptian trade with China is less than it should be. The low values of the intra-industry trade index suggest smaller trade between the two countries' firms in the same industry. The study clearly shows that there are few areas where there is an overlap in the two countries' comparative advantage. The trade complementarity analysis tends to suggest that the complementarity for China to export to Egypt is increasing, while that for Egypt to export to China is declining. Originality/value – Given the lack of research that examines and compares trade between the two countries, the paper provides an in-depth understanding of the patterns of trade between them and the driving forces behind such dynamics, which is pertinent to best capture the opportunities presented by the Chinese market. Also, the findings can be used to draw policy implications for promoting future trade and cooperation between Egypt and China. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper to examine if there is continuous macroeconomic compatibility between ASEAN-5 and China. Thus, in addition to the typical VECM test of the long run macroeconomic cointegration test, this paper examines the existence of an ongoing cointegration analysis. Design/methodology/approach – The degree of convergence during different sub-sample period of the full sample is employed, via Johansen cointegration rank tests, to examine if there is evidence of ongoing and improved cointegrating relationship among the economies. Findings – A successful ASEAN-China economic cooperation would only work if there is continuous macroeconomic interdependence between the partnership. Since a smooth transition of ACFTA will complement AFTA, the effective ASEAN-China coordination plan is essential to endorse a successful ASEAN-China coalition. Originality/value – This paper suggests a quick yet effective verification on the continuous compatibility of economies intended to have a long-term economic coordination. [ABSTRACT FROM AUTHOR]

Purpose - The purpose of this paper is to examine the trade linkages and degree of export competitiveness between Singapore, China and India. Design/methodology/approach - Balassa's export performance index and the dynamic RCA index was adopted, as suggested by Kreinin and Plummer to identify the revealed comparative advantage (RCA) of the above countries in industrial products by SITC 1- and 2-digit levels. The Spearman's rank correlation coefficient is used to identify the degree of complementarity between RCA indices. Findings - Given the abundant resources, China and India have comparative advantage in a broad range of manufactured goods as compared to Singapore. From the disaggregated analysis at 2-digit level, the paper finds that the Singapore and China exports are complements, although the degree of complementarity has being declining over time. Meanwhile, Singapore and India exports are found to be stronger complements and stable over time. The results also show that China and India exports are strong substitutes. The paper also finds that the export specialization of China and India has experienced significant changes and shifting to new export products over time. Originality/value - Given the recent trade agreements between China and Singapore and India and Singapore, it is important to examine the trade linkages (complementarity/substitutability of trade) between these countries. The paper highlights the importance of China and India in complementing countries such as Singapore as it climbs the technological ladder to maintain its competitiveness in the world market. [ABSTRACT FROM AUTHOR]

Purpose-This paper aims to critically examine China's exchange rate policy debate and discuss Chinese financial and capital control reform of recent years. Furthermore, using the empirical results based on a regional general equilibrium model, alternative methods are suggested of American concerns about China's role in contributing towards global financial stability and American trade deficits with China. Designlmethodology/approach-Regional general equilibrium input.output model. Findings-Sino-American debate on exchange rate policy is a matter of difference of opinion in sequencing of policies China has adopted to reduce capital account control and make her exchange rate regime more flexible. Using the final demand elasticity of exports it is observed that Chinese expansionary fiscal stimuli do have powerful effects in inducing additional exports for the United States and other Chinese trading partners. Research limitations/implications-The model does not include rest-of-the-world economies. Practical implications:-The results imply viable alternatives to renminbi/dollar appreciation policy in dealing with US-China persistent trade deficit. Originality/value-The paper suggests a new, empirical-based policy recommendation in dealing with the US trade deficit with China. [ABSTRACT FROM AUTHOR]

Purpose - Based on a sample of foreign-financed manufacturing firms in southern China, the purpose of this paper is to study the effects of ISO certification on productivity. Design/methodology/approach - The paper employs the stochastic frontier approach to estimate frontier efficiency scores at firm level. Findings - The empirical results suggest that the implementation of ISO was able to improve firms' productivity in the form of a wholly disembodied shift of the production frontier. The results further show that there was a mildly positive embodied shift of the production frontier due to the effects of ISO on the marginal product of labor. However, the embodied effects of ISO on the marginal product of capital were not significant. Research limitations/implications - The sample size is small and the data were collected from southern China. A generalization of results to other parts of China should be interpreted with caution. Despite the limited degree of generalization, firms with ISO certifications are suggested to be aware of certain flexibility in the implementation of the ISO documented procedures. Practical implications - The findings of the paper should be of general interest to firms seeking or adopting ISO system or other international standards. Originality/value - The originality of the paper resides in the fact that the empirical work investigates the embodied effects of ISO certification on the marginal product of labor and capital. [ABSTRACT FROM AUTHOR]

Purpose - Fast growth in China has led to significant improvement in people's living standards and average income. However, it has also brought about a huge rise in inequality. The purpose of this paper is to analyse regional and rural-urban inequality using a few income and consumption indicators. Design/methodology/approach - Data are collected from official statistical sources for all the Chinese provinces over 1978-1995. Both parametric and non-parametric methods are used to study the inequality between regions and between the rural and urban sub-populations. The parametric approach is to test whether per capita incomes among provinces converged over time. The non-parametric approach is the calculation and decomposition of the Gini coefficient by population sub-group and income source. Findings - The results show no evidence of growth convergence in per capita GDP, income and expenditure across provinces, but clear evidence of divergence in per capita rural (and urban) incomes and total expenditures. Three-quarters of inter-provincial income inequality are explained by inter-rural/urban inequality. Inter-provincial inequality explains more than half of rural inequality and less than half of urban inequality in most years. Originality/value - This paper uses one of the most complicated datasets for the Chinese regions. It studies inequality using different economic indicators. It considers the different dimensions of inequality in China using two different approaches. The results are important for regional development policies. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to evaluate the determinants of bank profitability in China. It examines the effects of inflation on bank profitability, while controlling for comprehensive bank-specific and industry-specific variables. Design/methodology/approach – The sample comprises a total of 101 banks (five state-owned banks, 12 joint-stock commercial banks and 84 city commercial banks). The period under consideration extends from 2003-2009. The two step generalized methods of moments (GMM) estimators are applied. Findings – Empirical results exhibit that there is a positive relationship between bank profitability, cost efficiency, banking sector development, stock market development and inflation in China. The authors report that low profitability can be explained by higher volume of non-traditional activity and higher taxation. Moreover, the authors confirm that there is a competitive environment in the Chinese banking industry. Furthermore, the authors propose policy actions that should be taken to improve bank profitability in China. Research limitations/implications – Further research can be conducted by investigating the profitability of numerous branches of all national banks and its determinants. Practical implications – The findings of the current study have considerable policy relevance. First, Chinese banks should emphasize the improvement of labour management and training skills, the purpose of which is to increase their productivity and boost the profitability. Furthermore, the government should gradually continue to open the banking and stock market, as the development of the financial sector is helpful in increasing the banks' profitability in China. Originality/value – Particular emphasis will be placed on the investigation into the effect of inflation on bank profitability while controlling for most comprehensive internal and external factors. [ABSTRACT FROM AUTHOR]

Purpose - This paper attempts to empirically examine the impact of financial development and bank characteristics on the operational performance of commercial banks in the Chinese transitional economy. Design/methodology/approach - Pooled cross-section (banks) and time-series data are employed in the empirical estimation, with the sample comprising a total of 14 Chinese banks. The period under consideration extends from 1996-2004. Fixed effects and random effects models are estimated. Findings - Empirical results exhibit higher levels of moneterization that can translate into better ROA performance for banks. The longer a bank has been in existence, the worse its ROA performance is found to be. Rather than leading to improved profitability, Chinese banks' efforts to develop non-traditional banking business actually have a negative impact on the ROA. The ROA performance of larger Chinese banks (in terms of assets) is found to be inferior to that of the smaller shareholding commercial banks. Originality/value - Particular emphasis will be placed on the unique characteristics of China's banking industry during this period of institutional transformation. [ABSTRACT FROM AUTHOR]