Author(s)

Huiming Xu

School of Economics, Jinan University, Guangzhou, China.

Based on the panel data of 40 Chinese commercial banks from 2004 to 2014, this paper tests empirically the relationship among business cycle, banking market structure and capital buffer using the method of GMM. The results show that in China: capital buffers fluctuate over the business cycles countercyclicality, and market concentration shows a negative relationship with the capital buffers. The decrease of market concentration enforces the countercyclical behavior of capital buffers.

Business Cycle, Banking Market Structure, Capital Buffer, Countercyclicality

Xu, H. (2016) Business Cycle, Banking Market Structure and Capital Buffer. Modern Economy, 7, 404-410. doi: 10.4236/me.2016.74044.