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Study traces China’s stumbling economic growth to the deployment of fiscal stimulus through local financing vehicles after the 2008 financial crisis

1 month ago
Amedeo Tumolillo
he looser financial constraints of local financing vehicles — off-balance-sheet companies that potentially obscure debt loads — led local governments in China to invest not just in infrastructure but also in their favorite private firms. This damaged the efficiency of the allocations, a compromised approach that continued well beyond the 2008 financial crisis, according to a new study.
By Amedeo Tumolillo
Amedeo Tumolillo is the editor-in-chief of SupChina and award-winning multimedia journalist. He previously worked at The New York Times and Spectrum. Follow him on Twitter at @hellotumo.