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The impact of integrating technology and finance on firm entry: Evidence from China's FinTech pilot policy

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  • Liu, Yuxin
  • Liu, Wenfei

Abstract

This study investigates the effects of technology-finance integration on firm entry across industries in China. Based on a comprehensive dataset from the State Administration for Industry and Commerce covering 2002–2020, we construct a quasi-natural experiment design using the 2011 FinTech pilot policy. On average, the policy impedes new firm entry by raising market barriers and increasing competition. However, a nuanced industry-specific effect is observed, with the policy promoting entry in strategic emerging, technology-intensive, and high-tech sectors, while deterring entry in others. These findings help understand how technological innovation and financial policies interact to shape industrial dynamics and entrepreneurial activity.

Suggested Citation

  • Liu, Yuxin & Liu, Wenfei, 2024. "The impact of integrating technology and finance on firm entry: Evidence from China's FinTech pilot policy," Finance Research Letters, Elsevier, vol. 70(C).
    • Handle: RePEc:eee:finlet:v:70:y:2024:i:c:s1544612324013291
    DOI: 10.1016/j.frl.2024.106300
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