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Regional financial technology and shadow banking activities of non-financial firms: Evidence from China

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  • Zhang, Qiuyue
  • Que, Jiangjing
  • Qin, Xiuting

Abstract

Financial technology has greatly revolutionized the finance industry. However, the impact of financial technology on the shadow banking activities of non-financial firms has not been examined. Using a sample of Chinese listed firms from 2011 to 2018, we find that regional financial technology is positively associated with the shadow banking activities of non-financial firms, which is more pronounced for firms with low profitability and firms listed only in China’s A-share market. We show that financial technology can enhance the shadow banking activities by alleviating financing constraints. In addition, an increase in the equalization of profit rate and an increase in investment in the real economy reduce the positive effect of financial technology on the shadow banking activities. Further analysis suggests that financial regulations can attenuate excessive shadow banking activities of non-financial firms driven by financial technology.

Suggested Citation

  • Zhang, Qiuyue & Que, Jiangjing & Qin, Xiuting, 2023. "Regional financial technology and shadow banking activities of non-financial firms: Evidence from China," Journal of Asian Economics, Elsevier, vol. 86(C).
    • Handle: RePEc:eee:asieco:v:86:y:2023:i:c:s104900782300026x
    DOI: 10.1016/j.asieco.2023.101606
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    Cited by:

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    9. Mara, Eugenia Ramona & Maran, Raluca, 2024. "Are fiscal rules efficient on public debt restraint in the presence of shadow economy?," Finance Research Letters, Elsevier, vol. 64(C).
    10. Yan, Youliang & Wang, Maochuan & Hu, Guoliu & Jiang, Chengxin, 2024. "Does Confucian culture affect shadow banking activities? Evidence from Chinese listed companies," Research in International Business and Finance, Elsevier, vol. 68(C).

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    More about this item

    Keywords

    Financial technology; Shadow banking; Financial regulation;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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