Zheng Michael Song and Wei Xiong
NBER Working Paper No. 24230
Since 2008 the Chinese debt-to-GDP ratio skyrockets. This fact, and the high leverage as well as the soaring housing prices, have caused wide concerns about the risks and instability of China’s financial system. Motivated by these concerns Song and Xiong reviewed several commonly perceived financial risks in their article and discuss the roots in China’s unique economic and financial system.