Collecting savings and making them available to entrepreneurs in the form of
long-term capital is traditionally the task of banks. What credit
institutions facilitated the collection of capital in China? How did it
circulate? Where were capital markets developing credit instruments,
allowing a wide exchange of information and the diffusion of financial
innovations? If very few of the Chinese financial institutions that handled
these operations was like a bank, in the sense of the term as used in the
Middle Ages in Europe, did they nevertheless fulfil, its functions, even
partially? Chapter 8 focuses on the analysis of China's financial
institutions and raises the issue of capital sterilization, due to the
fragmentation of financial institutions and high interest rates. It also
examines the extent to which corruption and the social obligations of the
rich contribute to the inability to accumulate and to capital destruction.
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