IDEAS home Printed from https://ideas.repec.org/a/eee/ememar/v60y2024ics1566014124000323.html
   My bibliography  Save this article

How does technological progress affect provincial financial resilience? Evidence at the provincial level in China

Author

Listed:
  • Xu, Dandan
  • Liu, Yuting

Abstract

The ever-changing global economy and sudden global public health events have posed challenges to financial resilience worldwide. As its important role in maintaining domestic economic stability, safeguarding national security, and enhancing international status, financial resilience has long been widely studied. However, few studies have empirically explored how technological progress affects financial resilience. Based on data from 30 provinces in China, this study adopts a panel two-way fixed effect model to identify the impact of technological progress on financial resilience and the underlying mechanisms. Results show that technological progress can significantly enhance financial resilience, and this impact is stronger in provinces with large population size, high employment proportion in the tertiary sector, high social consumption capacity, and provinces located in Central China. Further, technological progress have a positive impact on financial resilience through increased asset liquidity and government intervention.

Suggested Citation

  • Xu, Dandan & Liu, Yuting, 2024. "How does technological progress affect provincial financial resilience? Evidence at the provincial level in China," Emerging Markets Review, Elsevier, vol. 60(C).
    • Handle: RePEc:eee:ememar:v:60:y:2024:i:c:s1566014124000323
    DOI: 10.1016/j.ememar.2024.101137
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1566014124000323
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ememar.2024.101137?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Malik Shahzad Shabbir & Nusrat Yaqoob, 2019. "The impact of technological advancement on total factor productivity of cotton: a comparative analysis between Pakistan and India," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-16, December.
    2. Naeem, Muhammad Abubakr & Yousaf, Imran & Karim, Sitara & Yarovaya, Larisa & Ali, Shoaib, 2023. "Tail-event driven NETwork dependence in emerging markets," Emerging Markets Review, Elsevier, vol. 55(C).
    3. Xiaohui Chen & Yiqing He, 2022. "The Impact of Financial Resilience and Steady Growth on High-Quality Economic Development—Based on a Heterogeneous Intermediary Effect Analysis," Sustainability, MDPI, vol. 14(22), pages 1-19, November.
    4. Kontolaimou, Alexandra & Giotopoulos, Ioannis & Tsakanikas, Aggelos, 2016. "A typology of European countries based on innovation efficiency and technology gaps: The role of early-stage entrepreneurship," Economic Modelling, Elsevier, vol. 52(PB), pages 477-484.
    5. Edquist, Harald & Henrekson, Magnus, 2017. "Do R&D and ICT affect total factor productivity growth differently?," Telecommunications Policy, Elsevier, vol. 41(2), pages 106-119.
    6. Iftekhar Hasan & Nada Kobeissi & Haizhi Wang & Mingming Zhou, 2015. "Banking Structure, Marketization, and Small Business Development: Regional Evidence From China," Pacific Economic Review, Wiley Blackwell, vol. 20(3), pages 487-510, August.
    7. Fanny Salignac & Julien Hanoteau & Ioana Ramia, 2022. "Financial Resilience: A Way Forward Towards Economic Development in Developing Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 160(1), pages 1-33, February.
    8. Bellardini, Luca & Del Gaudio, Belinda Laura & Previtali, Daniele & Verdoliva, Vincenzo, 2022. "How do banks invest in fintechs? Evidence from advanced economies," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 77(C).
    9. Naeem, Muhammad Abubakr & Shahzad, Mohammad Rahim & Karim, Sitara & Assaf, Rima, 2023. "Tail risk transmission in technology-driven markets," Global Finance Journal, Elsevier, vol. 57(C).
    10. Dynan, Karen E. & Elmendorf, Douglas W. & Sichel, Daniel E., 2006. "Can financial innovation help to explain the reduced volatility of economic activity?," Journal of Monetary Economics, Elsevier, vol. 53(1), pages 123-150, January.
    11. A.H.M. Belayeth Hussain & Noraida Endut & Sumonkanti Das & Mohammed Thanvir Ahmed Chowdhury & Nadia Haque & Sumena Sultana & Khandaker Jafor Ahmed, 2019. "Does financial inclusion increase financial resilience? Evidence from Bangladesh," Development in Practice, Taylor & Francis Journals, vol. 29(6), pages 798-807, August.
    12. Phan, Dinh Hoang Bach & Narayan, Paresh Kumar & Rahman, R. Eki & Hutabarat, Akhis R., 2020. "Do financial technology firms influence bank performance?," Pacific-Basin Finance Journal, Elsevier, vol. 62(C).
    13. Kroll, Henning & Tagscherer, Ulrike, 2009. "Chinese regional innovation systems in times of crisis: the case of Guangdong," Discussion Papers "Innovation Systems and Policy Analysis" 19, Fraunhofer Institute for Systems and Innovation Research (ISI).
    14. Angela C. Lyons & Josephine Kass-Hanna, 2021. "Financial Inclusion, Financial Literacy and Economically Vulnerable Populations in the Middle East and North Africa," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(9), pages 2699-2738, July.
    15. Kass-Hanna, Josephine & Lyons, Angela C. & Liu, Fan, 2022. "Building financial resilience through financial and digital literacy in South Asia and Sub-Saharan Africa," Emerging Markets Review, Elsevier, vol. 51(PA).
    16. Shivam Gupta & Sachin Modgil & Tsan-Ming Choi & Ajay Kumar & Jiju Antony, 2023. "Influences of artificial intelligence and blockchain technology on financial resilience of supply chains," Post-Print hal-04325728, HAL.
    17. Wang, You & Gong, Xu, 2020. "Does financial development have a non-linear impact on energy consumption? Evidence from 30 provinces in China," Energy Economics, Elsevier, vol. 90(C).
    18. Berger, Allen N, 2003. "The Economic Effects of Technological Progress: Evidence from the Banking Industry," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 35(2), pages 141-176, April.
    19. Peter Gomber & Jascha-Alexander Koch & Michael Siering, 2017. "Digital Finance and FinTech: current research and future research directions," Journal of Business Economics, Springer, vol. 87(5), pages 537-580, July.
    20. Muhammad Abubakr Naeem & Imen Mbarki & Muhammed Tahir Suleman & Xuan Vinh Vo & Syed Jawad Hussain Shahzad, 2021. "Does Twitter Happiness Sentiment predict cryptocurrency?," International Review of Finance, International Review of Finance Ltd., vol. 21(4), pages 1529-1538, December.
    21. Fanny Salignac & Axelle Marjolin & Rebecca Reeve & Kristy Muir, 2019. "Conceptualizing and Measuring Financial Resilience: A Multidimensional Framework," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 145(1), pages 17-38, August.
    22. Minh-Hoang Nguyen & Quy Van Khuc & Viet-Phuong La & Tam-Tri Le & Quang-Loc Nguyen & Ruining Jin & Phuong-Tri Nguyen & Quan-Hoang Vuong, 2022. "Mindsponge-Based Reasoning of Households’ Financial Resilience during the COVID-19 Crisis," JRFM, MDPI, vol. 15(11), pages 1-18, November.
    23. Leora Klapper & Annamaria Lusardi, 2020. "Financial literacy and financial resilience: Evidence from around the world," Financial Management, Financial Management Association International, vol. 49(3), pages 589-614, September.
    24. Fredric S. Mishkin & Philip E. Strahan, 1999. "What Will Technology Do to Financial Structure?," NBER Working Papers 6892, National Bureau of Economic Research, Inc.
    25. Muhammad Ramzan & Bin Sheng & Muhammad Shahbaz & Jian Song & Zhilun Jiao, 2019. "Impact of trade openness on GDP growth: Does TFP matter?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 28(8), pages 960-995, November.
    26. Stijn Claessens & Thomas Glaessner & Daniela Klingebiel, 2002. "Electronic Finance: Reshaping the Financial Landscape Around the World," Journal of Financial Services Research, Springer;Western Finance Association, vol. 22(1), pages 29-61, August.
    27. Gamze Ozturk Danisman & Ender Demir & Adam Zaremba, 2021. "Financial Resilience To The Covid-19 Pandemic: The Role Of Banking Market Structure," Applied Economics, Taylor & Francis Journals, vol. 53(39), pages 4481-4504, August.
    28. repec:eme:mfppss:mf-09-2021-0442 is not listed on IDEAS
    29. González, Luís Otero & Rodríguez Gil, Luís Ignacio & Martorell Cunill, Onofre & Merigó Lindahl, José M., 2016. "The effect of financial innovation on European banks' risk," Journal of Business Research, Elsevier, vol. 69(11), pages 4781-4786.
    30. Bhattacharya, Utpal & Spiegel, Matthew, 1998. "Anatomy of a Market Failure: NYSE Trading Suspensions (1974-1988)," Journal of Business & Economic Statistics, American Statistical Association, vol. 16(2), pages 216-226, April.
    31. Niels Hermes & Robert Lensink, 2003. "Foreign direct investment, financial development and economic growth," Journal of Development Studies, Taylor & Francis Journals, vol. 40(1), pages 142-163.
    32. Wasseem, Mina, 2007. "Are the GCC FDI Location Determinants Favorable?," Economics Discussion Papers 2007-23, Kiel Institute for the World Economy (IfW Kiel).
    33. repec:zbw:bofitp:urn:nbn:fi:bof-201504131154 is not listed on IDEAS
    34. Khan, Zeeshan & Hussain, Muzzammil & Shahbaz, Muhammad & Yang, Siqun & Jiao, Zhilun, 2020. "Natural resource abundance, technological innovation, and human capital nexus with financial development: A case study of China," Resources Policy, Elsevier, vol. 65(C).
    35. Broto, Carmen & Lamas, Matías, 2020. "Is market liquidity less resilient after the financial crisis? Evidence for US Treasuries," Economic Modelling, Elsevier, vol. 93(C), pages 217-229.
    36. Hussain, Matloub & Papastathopoulos, Avraam, 2022. "Organizational readiness for digital financial innovation and financial resilience," International Journal of Production Economics, Elsevier, vol. 243(C).
    37. Alessio Ciullo & Eric Strobl & Simona Meiler & Olivia Martius & David N. Bresch, 2023. "Increasing countries’ financial resilience through global catastrophe risk pooling," Nature Communications, Nature, vol. 14(1), pages 1-9, December.
    38. Xu, Hengzhou & Jiao, Man, 2021. "City size, industrial structure and urbanization quality—A case study of the Yangtze River Delta urban agglomeration in China," Land Use Policy, Elsevier, vol. 111(C).
    39. Yantong Zhao & Rusmawati Said, 2023. "The Effect of the Digital Economy on the Employment Structure in China," Economies, MDPI, vol. 11(9), pages 1-14, September.
    40. Gupta, Shivam & Modgil, Sachin & Choi, Tsan-Ming & Kumar, Ajay & Antony, Jiju, 2023. "Influences of artificial intelligence and blockchain technology on financial resilience of supply chains," International Journal of Production Economics, Elsevier, vol. 261(C).
    41. Margono, Heru & Sharma, Subhash C. & Melvin II, Paul D., 2010. "Cost efficiency, economies of scale, technological progress and productivity in Indonesian banks," Journal of Asian Economics, Elsevier, vol. 21(1), pages 53-65, February.
    42. Gregory S. Miller & Douglas J. Skinner, 2015. "The Evolving Disclosure Landscape: How Changes in Technology, the Media, and Capital Markets Are Affecting Disclosure," Journal of Accounting Research, Wiley Blackwell, vol. 53(2), pages 221-239, May.
    43. Lee, Chien-Chiang & Wang, Chih-Wei & Ho, Shan-Ju, 2020. "Financial innovation and bank growth: The role of institutional environments," The North American Journal of Economics and Finance, Elsevier, vol. 53(C).
    44. Franklin Allen & Itay Goldstein & Julapa Jagtiani, 2018. "The Interplay among Financial Regulations, Resilience, and Growth," Journal of Financial Services Research, Springer;Western Finance Association, vol. 53(2), pages 141-162, June.
    45. Boochun Jung & Woo†Jong Lee & David P. Weber, 2014. "Financial Reporting Quality and Labor Investment Efficiency," Contemporary Accounting Research, John Wiley & Sons, vol. 31(4), pages 1047-1076, December.
    46. Liu, Xiaohui & Wang, Chenggang, 2003. "Does foreign direct investment facilitate technological progress?: Evidence from Chinese industries," Research Policy, Elsevier, vol. 32(6), pages 945-953, June.
    47. Sharif, Naubahar & Huang, Can, 2012. "Innovation strategy, firm survival and relocation: The case of Hong Kong-owned manufacturing in Guangdong Province, China," Research Policy, Elsevier, vol. 41(1), pages 69-78.
    48. Naeem, Muhammad Abubakr & Karim, Sitara & Abrar, Afsheen & Yarovaya, Larisa & Shah, Adil Ahmad, 2023. "Non-linear relationship between oil and cryptocurrencies: Evidence from returns and shocks," International Review of Financial Analysis, Elsevier, vol. 89(C).
    49. repec:zbw:bofitp:2015_011 is not listed on IDEAS
    50. LIU Mengfei & FENG Jie & LUO Xiaowei, 2022. "RegTech: Theory and Practice in Technology Driven Financial Regulation," Frontiers of Economics in China-Selected Publications from Chinese Universities, Higher Education Press, vol. 17(1), pages 164-187, March.
    51. Fakhri J. Hasanov & Zeeshan Khan & Muzzammil Hussain & Muhammad Tufail, 2021. "Theoretical Framework for the Carbon Emissions Effects of Technological Progress and Renewable Energy Consumption," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(5), pages 810-822, September.
    52. Phan, Dinh Hoang Bach & Iyke, Bernard Njindan & Sharma, Susan Sunila & Affandi, Yoga, 2021. "Economic policy uncertainty and financial stability–Is there a relation?," Economic Modelling, Elsevier, vol. 94(C), pages 1018-1029.
    53. repec:eme:aaaj00:aaaj-09-2020-4919 is not listed on IDEAS
    54. Rui Wang & Jiangtao Liu & Hang(Robin) Luo, 2021. "Fintech development and bank risk taking in China," The European Journal of Finance, Taylor & Francis Journals, vol. 27(4-5), pages 397-418, March.
    55. Ralph Kober & Paul J. Thambar, 2021. "Coping with COVID-19: the role of accounting in shaping charities' financial resilience," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 34(6), pages 1416-1429, May.
    56. Yang, Tong & Zhang, Xun, 2022. "FinTech adoption and financial inclusion: Evidence from household consumption in China," Journal of Banking & Finance, Elsevier, vol. 145(C).
    57. Sungyoon Lee & Gang Chen, 2022. "Understanding financial resilience from a resource-based view: Evidence from US state governments," Public Management Review, Taylor & Francis Journals, vol. 24(12), pages 1980-2003, December.
    58. Peter Arbo & Paul Benneworth, 2007. "Understanding the Regional Contribution of Higher Education Institutions: A Literature Review," OECD Education Working Papers 9, OECD Publishing.
    59. Karim, Sitara & Lucey, Brian M. & Naeem, Muhammad Abubakr & Vigne, Samuel A., 2023. "The dark side of Bitcoin: Do Emerging Asian Islamic markets help subdue the ethical risk?," Emerging Markets Review, Elsevier, vol. 54(C).
    60. Guangyou Zhou & Sumei Luo, 2018. "Higher Education Input, Technological Innovation, and Economic Growth in China," Sustainability, MDPI, vol. 10(8), pages 1-15, July.
    61. Xueli Wang & Caizhi Sun & Song Wang & Zhixiong Zhang & Wei Zou, 2018. "Going Green or Going Away? A Spatial Empirical Examination of the Relationship between Environmental Regulations, Biased Technological Progress, and Green Total Factor Productivity," IJERPH, MDPI, vol. 15(9), pages 1-23, September.
    62. Thomas, V.J. & Sharma, Seema & Jain, Sudhir K., 2011. "Using patents and publications to assess R&D efficiency in the states of the USA," World Patent Information, Elsevier, vol. 33(1), pages 4-10, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Guo, Pin & Zhang, Cheng, 2023. "The impact of bank FinTech on liquidity creation: Evidence from China," Research in International Business and Finance, Elsevier, vol. 64(C).
    2. Li, Guoxiang & Wu, Haoyue & Jiang, Jieshu & Zong, Qingqing, 2023. "Digital finance and the low-carbon energy transition (LCET) from the perspective of capital-biased technical progress," Energy Economics, Elsevier, vol. 120(C).
    3. Mohd Daud, Siti Nurazira & Osman, Zaiton & Samsudin, Shamzaeffa & Phang, Ing Grace, 2024. "Adapting to the gig economy: Determinants of financial resilience among “Giggers”," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 756-771.
    4. Song, Yunxing & Gong, Yuanyuan & Song, Yan & Chen, Xiaohui, 2024. "Exploring the impact of digital inclusive finance on consumption volatility: Insights from household entrepreneurship and income volatility," Technological Forecasting and Social Change, Elsevier, vol. 200(C).
    5. Koranteng, Barbara & You, Kefei, 2024. "Fintech and financial stability: Evidence from spatial analysis for 25 countries," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 93(C).
    6. Hongyu Li & Zhiqiang Lu & Qili Yin, 2023. "The Development of Fintech and SME Innovation: Empirical Evidence from China," Sustainability, MDPI, vol. 15(3), pages 1-14, January.
    7. Emilia Bonaccorsi di Patti & Giorgio Gobbi & Paolo Emilio Mistrulli, 2004. "The interaction between face-to-face and electronic delivery: the case of the Italian banking industry," Temi di discussione (Economic working papers) 508, Bank of Italy, Economic Research and International Relations Area.
    8. Kass-Hanna, Josephine & Lyons, Angela C. & Liu, Fan, 2022. "Building financial resilience through financial and digital literacy in South Asia and Sub-Saharan Africa," Emerging Markets Review, Elsevier, vol. 51(PA).
    9. Tang, Mengxuan & Hu, Yang & Corbet, Shaen & Hou, Yang (Greg) & Oxley, Les, 2024. "Fintech, bank diversification and liquidity: Evidence from China," Research in International Business and Finance, Elsevier, vol. 67(PA).
    10. Luo, Sumei & Sun, Yongkun & Yang, Fan & Zhou, Guangyou, 2022. "Does fintech innovation promote enterprise transformation? Evidence from China," Technology in Society, Elsevier, vol. 68(C).
    11. Guo, Junyan & Fang, Hanqing & Liu, Xuexin & Wang, Cizhi & Wang, Yuan, 2023. "FinTech and financing constraints of enterprises: Evidence from China," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 82(C).
    12. Choudhary, Priya & Thenmozhi, M., 2024. "Fintech and financial sector: ADO analysis and future research agenda," International Review of Financial Analysis, Elsevier, vol. 93(C).
    13. Naeem, Muhammad Abubakr & Nguyen, Thi Thu Ha & Karim, Sitara & Lucey, Brian M., 2023. "Extreme downside risk transmission between green cryptocurrencies and energy markets: The diversification benefits," Finance Research Letters, Elsevier, vol. 58(PA).
    14. Liu, Taixing & Fan, Miaomiao & Li, Youwei & Yue, Pengpeng, 2024. "Financial literacy and household financial resilience," Finance Research Letters, Elsevier, vol. 63(C).
    15. Azra Zaimovic & Anes Torlakovic & Almira Arnaut-Berilo & Tarik Zaimovic & Lejla Dedovic & Minela Nuhic Meskovic, 2023. "Mapping Financial Literacy: A Systematic Literature Review of Determinants and Recent Trends," Sustainability, MDPI, vol. 15(12), pages 1-30, June.
    16. Bin Amin, Sakib & Taghizadeh-Hesary, Farhad & Khan, Farhan & Manal Rahman, Faria, 2024. "Does technology have a lead or lag role in economic growth? The case of selected resource-rich and resource-scarce countries," Resources Policy, Elsevier, vol. 89(C).
    17. Gallego-Losada, María-Jesús & Montero-Navarro, Antonio & García-Abajo, Elisa & Gallego-Losada, Rocío, 2023. "Digital financial inclusion. Visualizing the academic literature," Research in International Business and Finance, Elsevier, vol. 64(C).
    18. O’Sullivan, Conall & Papavassiliou, Vassilios G. & Wafula, Ronald Wekesa & Boubaker, Sabri, 2024. "New insights into liquidity resiliency," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 90(C).
    19. Hala Hmamed & Anass Cherrafi & Asmaa Benghabrit & Sunil Tiwari & Pankaj Sharma, 2024. "The adoption of I4.0 technologies for a sustainable and circular supply chain: an industry‐based SEM analysis from the textile sector," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 2949-2968, May.
    20. Gong, Zheng, 2021. "Can Digital Finance Promote the Technological Innovation of Agricultural Enterprises?—Evidence from NEEQ Companies in China," 2021 ASAE 10th International Conference (Virtual), January 11-13, Beijing, China 329419, Asian Society of Agricultural Economists (ASAE).

    More about this item

    Keywords

    Technological progress; Financial resilience; Heterogeneity; Mechanism; China;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ememar:v:60:y:2024:i:c:s1566014124000323. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620356 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.