We use statistical data for the period 2000-2013 to compare the macro-level structure and the core institutions of the banking systems in China and Russia. Our main hypothesis is that, differences in the absolute size and socio-cultural features...
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ZBW - Leibniz-Informationszentrum Wirtschaft, Standort Kiel
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We use statistical data for the period 2000-2013 to compare the macro-level structure and the core institutions of the banking systems in China and Russia. Our main hypothesis is that, differences in the absolute size and socio-cultural features nothwithstanding, these two systems are typologically similar. We consider the institutional structure, the market structure and concentration, the industrial policy of the government, and the banks' involvement in the financing of the non-financial economy. We find similarities as well as differences, however in dynamics the trend towards convergence prevails. In both countries, we see a hierarchical multi-tier banking system headed by a few core state-controlled banks. These combine commercial activities with the activity of a development institution. Regardless of the nominal form of ownership, the government exerts influence on the banks' lending decisions and market behavior. We argue that the Chinese and Russian banking provide empirical proof to the macrosociological theory of institutional matrices. We refer in particular to the proportion between the dominant and complementary institutions. China has been searching gradually and carefully the right balance consistent with its historical path. Russia in the 1990s grossly overshot with its run-away liberalization and now reverts to the underlying long-term trend. China has currently become an institutional donor for Russia in terms of innovations for the credit system design.
