IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v13y2021i21p12267-d673640.html
   My bibliography  Save this article

Investor Activity in Chinese Financial Institutions: A Precursor to Economic Sustainability

Author

Listed:
  • Rob Kim Marjerison

    (Global Business, College of Business and Public Management, Wenzhou-Kean University, Wenzhou 325060, China)

  • Chungil Chae

    (Business Analytics, College of Business and Public Management, Wenzhou-Kean University, Wenzhou 325060, China)

  • Shitong Li

    (Warwick Business School, University of Warwick, Coventry CV4 7AL, UK)

Abstract

One requirement for sustainable economic development is established, trusted, and utilized financial institutions to facilitate investment. The rapid development of financial markets in China, combined with the recency and magnitude of middle-class wealth, has resulted in a rapidly changing investment landscape, as well as changes in people’s investing activities. The extent to which economic growth is sustainable will depend, at least in part, on how financial institutions are perceived, as well as the extent to which they are utilized. The objective of this study was to examine the investment behaviors of individual investors as a way to ascertain the perceived level of trust and stability in the relatively recently developed financial institutions. The influence of market information acquisition on asset allocation and value investment in China was analyzed. This study used secondary data from a China securities corporation from previous research. The analyses utilized the general decision-making style test to assess respondents’ decision-making models and quantitative research methodology culminating in the use of correlation analysis. The results indicated that the acquisition of market information had a positive correlation with the number of assets and investment portfolios. Practical implications and suggestions for future research are provided. The results may be of interest to individual and institutional investors in China, as well as those with an interest in current trends in market information acquisition, asset allocation, and value investment in China.

Suggested Citation

  • Rob Kim Marjerison & Chungil Chae & Shitong Li, 2021. "Investor Activity in Chinese Financial Institutions: A Precursor to Economic Sustainability," Sustainability, MDPI, vol. 13(21), pages 1-17, November.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:21:p:12267-:d:673640
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/13/21/12267/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/13/21/12267/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Aggarwal, Raj & Goodell, John W., 2010. "Financial markets versus institutions in European countries: Influence of culture and other national characteristics," International Business Review, Elsevier, vol. 19(5), pages 502-520, October.
    2. Damien Chaney & Mourad Touzani & Karim Ben Slimane, 2017. "Marketing to the (new) generations: summary and perspectives," Post-Print hal-02047966, HAL.
    3. De Long, J Bradford, et al, 1990. "Positive Feedback Investment Strategies and Destabilizing Rational Speculation," Journal of Finance, American Finance Association, vol. 45(2), pages 379-395, June.
    4. Yu Shen & Kehan Zhu & Fengyun Wu & Ping Chen, 2020. "The Stock Investment Performance of Pension Funds in China," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 56(12), pages 2732-2748, September.
    5. Yang, Jun & Lu, Jing & Xiang, Cheng, 2020. "Do disclosures of selective access improve market information acquisition fairness? Evidence from company visits in China," Journal of Corporate Finance, Elsevier, vol. 64(C).
    6. Brosdahl, Deborah J.C. & Carpenter, Jason M., 2011. "Shopping orientations of US males: A generational cohort comparison," Journal of Retailing and Consumer Services, Elsevier, vol. 18(6), pages 548-554.
    7. Van Dan Dang, 2019. "The risk-return trade-off of liquidity positions: evidence from Vietnamese banking system," International Journal of Monetary Economics and Finance, Inderscience Enterprises Ltd, vol. 12(5), pages 390-406.
    8. Joscha Beckmann & Theo Berger & Robert Czudaj & Thi-Hong-Van Hoang, 2019. "Tail dependence between gold and sectorial stocks in China: perspectives for portfolio diversification," Empirical Economics, Springer, vol. 56(3), pages 1117-1144, March.
    9. S. Korablin, 2019. "China: investment ambitions, limitations and opportunitiesy," Economy and Forecasting, Valeriy Heyets, issue 3, pages 138-157.
    10. Acharya, Viral & Qian, Jun & Su, Yang & Yang, Zhishu, 2020. "In the Shadow of Banks: Wealth Management Products and Issuing Banks’ Risks in China," CEPR Discussion Papers 14957, C.E.P.R. Discussion Papers.
    11. Zhou, Weina, 2014. "Brothers, household financial markets and savings rate in China," Journal of Development Economics, Elsevier, vol. 111(C), pages 34-47.
    12. Qiujun Lan & Qingyue Xiong & Linjie He & Chaoqun Ma, 2018. "Individual investment decision behaviors based on demographic characteristics: Case from China," PLOS ONE, Public Library of Science, vol. 13(8), pages 1-16, August.
    13. Miao, Hong & Ramchander, Sanjay & Wang, Tianyang & Yang, Dongxiao, 2017. "Role of index futures on China's stock markets: Evidence from price discovery and volatility spillover," Pacific-Basin Finance Journal, Elsevier, vol. 44(C), pages 13-26.
    14. Andy C. W. Chui & Chuck C. Y. Kwok, 1998. "Cross-Autocorrelation Between A Shares And B Shares In The Chinese Stock Market," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 21(3), pages 333-353, September.
    15. Justin Yifu Lin, 2011. "China and the global economy," Proceedings, Federal Reserve Bank of San Francisco, issue Nov, pages 213-229.
    16. Chadwick C. Curtis & Steven Lugauer & Nelson C. Mark, 2015. "Demographic Patterns and Household Saving in China," American Economic Journal: Macroeconomics, American Economic Association, vol. 7(2), pages 58-94, April.
    17. Hui-Fun Yu & Tsui-Jung Lin & Hai-Yen Chang & Yu-Huai Wang, 2020. "The Impact of Political Connection and Information Asymmetry on Investment Efficiency: Evidence from China," Sustainability, MDPI, vol. 12(14), pages 1-15, July.
    18. Merton H. Miller, 2024. "Financial markets and economic growth," Journal of Applied Corporate Finance, Morgan Stanley, vol. 36(1), pages 9-14, January.
    19. Wanglin Ma & R. Quentin Grafton & Alan Renwick, 2020. "Smartphone use and income growth in rural China: empirical results and policy implications," Electronic Commerce Research, Springer, vol. 20(4), pages 713-736, December.
    20. Aaberge, Rolf & Liu, Kai & Zhu, Yu, 2017. "Political uncertainty and household savings," Journal of Comparative Economics, Elsevier, vol. 45(1), pages 154-170.
    21. Emilia Madudova & Tatiana Čorejova & Marek Valica, 2018. "Economic Sustainability in a Wider Context: Case Study of Considerable ICT Sector Sub-Divisions," Sustainability, MDPI, vol. 10(7), pages 1-16, July.
    22. Gospodinov, Nikolay & Robotti, Cesare, 2021. "Common pricing across asset classes: Empirical evidence revisited," Journal of Financial Economics, Elsevier, vol. 140(1), pages 292-324.
    23. Tan, Yong & Floros, Christos, 2018. "Risk, competition and efficiency in banking: Evidence from China," Global Finance Journal, Elsevier, vol. 35(C), pages 223-236.
    24. Fengming Qin & Junru Zhang & Zhaoyong Zhang, 2018. "RMB Exchange Rates and Volatility Spillover across Financial Markets in China and Japan," Risks, MDPI, vol. 6(4), pages 1-26, October.
    25. Guowen Han & Yongjin Wu & Warren Young, 2014. "Asymmetric effects of monetary policy on an emerging stock market," International Journal of Monetary Economics and Finance, Inderscience Enterprises Ltd, vol. 7(3), pages 192-206.
    26. Jiang, Fuxiu & Jiang, Zhan & Kim, Kenneth A., 2020. "Capital markets, financial institutions, and corporate finance in China," Journal of Corporate Finance, Elsevier, vol. 63(C).
    27. Chen, Xiao & Lee, Chi-Wen Jevons & Li, Jing, 2008. "Government assisted earnings management in China," Journal of Accounting and Public Policy, Elsevier, vol. 27(3), pages 262-274.
    28. Mohammad Uzair Akram & Kashif Zaheer Malik & Ali Imtiaz & Ammar Aftab & Maggie Chen, 2020. "Forex and financial markets dynamics: A case of China and ASEAN," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1756144-175, January.
    29. K. Sriharsha Reddy & Mousumi Singha Mahapatra, 2017. "Risk tolerance, personal financial knowledge and demographic characteristicsevidence from India," Journal of Developing Areas, Tennessee State University, College of Business, vol. 51(3), pages 51-62, July-Sept.
    30. Wenjie Chen & David Dollar & Heiwai Tang, 2018. "Why Is China Investing in Africa? Evidence from the Firm Level," The World Bank Economic Review, World Bank, vol. 32(3), pages 610-632.
    31. Evgeny Lyandres & Egor Matveyev & Alexei Zhdanov, 0. "Does the Market Correctly Value Investment Options?," Review of Finance, European Finance Association, vol. 24(6), pages 1159-1201.
    32. Guanghua Wan & Peter J. Morgan & Robert J. Barro, 2016. "Economic Growth and Convergence, Applied to China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 24(5), pages 5-19, September.
    33. Robert J. Barro, 2016. "Economic Growth and Convergence, Applied Especially to China," NBER Working Papers 21872, National Bureau of Economic Research, Inc.
    34. Yang-Chao Wang & Jui-Jung Tsai & Qiaoqiao Li, 2017. "Policy Impact on the Chinese Stock Market: From the 1994 Bailout Policies to the 2015 Shanghai-Hong Kong Stock Connect," IJFS, MDPI, vol. 5(1), pages 1-19, January.
    35. Chui, Andy C W & Kwok, Chuck C Y, 1998. "Cross-Autocorrelation between A Shares and B Shares in the Chinese Stock Market," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 21(3), pages 333-353, Fall.
    36. Matiur Rahman & Muhammad Mustafa, 2017. "Financial deepening and stock market returns: panel data analyses for selected developed and developing economies," International Journal of Monetary Economics and Finance, Inderscience Enterprises Ltd, vol. 10(1), pages 96-109.
    37. Robert Harmel & Yao‐Yuan Yeh, 2019. "Impacts of Internet on Openness to Change in China: Millennials Versus Pre‐Millennials," Social Science Quarterly, Southwestern Social Science Association, vol. 100(5), pages 1744-1754, August.
    38. Cukierman, Alex, 1980. "The Effects of Uncertainty on Investment under Risk Neutrality with Endogenous Information," Journal of Political Economy, University of Chicago Press, vol. 88(3), pages 462-475, June.
    39. Henriëtte Prast & Iman van Lelyveld, 2004. "New Architectures in the Regulation and Supervision of Financial Markets and Institutions: The Netherlands," DNB Working Papers 021, Netherlands Central Bank, Research Department.
    40. Evgeny Lyandres & Egor Matveyev & Alexei Zhdanov, 2020. "Does the Market Correctly Value Investment Options?," Review of Finance, European Finance Association, vol. 24(6), pages 1159-1201.
    41. William N. Goetzmann & Andrey D. Ukhov & Ning Zhu, 2007. "China and the world financial markets 1870–1939: Modern lessons from historical globalization1," Economic History Review, Economic History Society, vol. 60(2), pages 267-312, May.
    42. Agnieszka Gehringer, 2014. "Financial liberalisation, financial development and productivity growth: an overview," International Journal of Monetary Economics and Finance, Inderscience Enterprises Ltd, vol. 7(1), pages 40-65.
    43. Ma, Wanglin & Renwick, Alan & Nie, Peng & Tang, Jianjun & Cai, Rong, 2018. "Off-farm work, smartphone use and household income: Evidence from rural China," China Economic Review, Elsevier, vol. 52(C), pages 80-94.
    44. Evelyn Wamboye & Abel Adekola & Bruno S Sergi, 2013. "Economic Growth and the Role of Foreign Aid in Selected African Countries," Development, Palgrave Macmillan;Society for International Deveopment, vol. 56(2), pages 155-171, June.
    45. Fang, Ming & Li, Haiyang & Wang, Qin, 2021. "Risk tolerance and household wealth--Evidence from Chinese households," Economic Modelling, Elsevier, vol. 94(C), pages 885-895.
    46. Yixuan Zhao & Qin Xu, 2019. "Understanding the achieving styles of Chinese millennials and implications on HRM policy," International Journal of Manpower, Emerald Group Publishing Limited, vol. 41(3), pages 303-317, December.
    47. Dayong Zhang & Jing Cai & Jia Liu & Ali M. Kutan, 2018. "Real estate investments and financial stability: evidence from regional commercial banks in China," The European Journal of Finance, Taylor & Francis Journals, vol. 24(16), pages 1388-1408, November.
    48. Damien Chaney & Mourad Touzani & Karim Ben Slimane, 2017. "Marketing to the (new) generations: summary and perspectives," Post-Print hal-02541232, HAL.
    49. Nicholas R. Lardy, 2019. "The State Strikes Back: The End of Economic Reform in China?," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 7373, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rob Kim Marjerison & Matthew Andrews & George Kuan, 2022. "Creating Sustainable Organizations through Knowledge Sharing and Organizational Agility: Empirical Evidence from China," Sustainability, MDPI, vol. 14(8), pages 1-23, April.

    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. Zeng, Miao & Du, Jiang & Zhu, Xiaoyu & Deng, Xin, 2023. "Does internet use drive rural household savings? Evidence from 7825 farmer households in rural China," Finance Research Letters, Elsevier, vol. 57(C).
    2. Daxue Wang, 2006. "Cross-Autocorrelation of Dual-Listed Stock Portfolio Returns: Evidence from the Chinese Stock Market," Computing in Economics and Finance 2006 182, Society for Computational Economics.
    3. Sabina Lissitsa & Ofrit Kol, 2021. "Four generational cohorts and hedonic m-shopping: association between personality traits and purchase intention," Electronic Commerce Research, Springer, vol. 21(2), pages 545-570, June.
    4. Ahsan Akbar & Saqib Ali & Muhammad Azeem Ahmad & Minhas Akbar & Muhammad Danish, 2019. "Understanding the Antecedents of Organic Food Consumption in Pakistan: Moderating Role of Food Neophobia," IJERPH, MDPI, vol. 16(20), pages 1-20, October.
    5. Lissitsa, Sabina & Laor, Tal, 2021. "Baby Boomers, Generation X and Generation Y: Identifying generational differences in effects of personality traits in on-demand radio use," Technology in Society, Elsevier, vol. 64(C).
    6. Takatoshi Sasaki & Tomoya Sakata & Yui Mukoyama & Koichi Yoshino, 2021. "China's Long-Term Growth Potential: Can Productivity Convergence Be Sustained?," Bank of Japan Working Paper Series 21-E-7, Bank of Japan.
    7. Dayong Zhang & David Dickinson & Marco R. Barassi, 2006. "Structural Breaks, Cointegration and the B Share Discount in Chinese Stock Market," EcoMod2006 272100108, EcoMod.
    8. Parks-Stamm, Elizabeth J. & Flinner, Sameena M., 2024. "Generational differences in payment transparency perceptions," Journal of Retailing and Consumer Services, Elsevier, vol. 77(C).
    9. Eger, Ludvík & Komárková, Lenka & Egerová, Dana & MiÄ Ã­k, Michal, 2021. "The effect of COVID-19 on consumer shopping behaviour: Generational cohort perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 61(C).
    10. Murach, Michael & Wagner, Helmut & Kim, Jungsuk & Park, Donghyun, 2022. "Trajectories to high income: Comparing the growth dynamics in China, South Korea, and Japan with cointegrated VAR models," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 492-511.
    11. Sjoo, Boo & Zhang, Jianhua, 2000. "Market segmentation and information diffusion in China's stock markets," Journal of Multinational Financial Management, Elsevier, vol. 10(3-4), pages 421-438, December.
    12. Zhang, Xiaobei & Wang, Xiaojun, 2021. "Measures of human capital and the mechanics of economic growth," China Economic Review, Elsevier, vol. 68(C).
    13. Guangyou Zhou & Sumei Luo, 2018. "Higher Education Input, Technological Innovation, and Economic Growth in China," Sustainability, MDPI, vol. 10(8), pages 1-15, July.
    14. Hazem Ali & Min Li & Yunhong Hao, 2021. "Purchasing Behavior of Organic Food among Chinese University Students," Sustainability, MDPI, vol. 13(10), pages 1-17, May.
    15. Zhou, Xiaoguang & Cui, Yadi & Wu, Shihwei & Wang, Weiqing, 2019. "The influence of cultural distance on the volatility of the international stock market," Economic Modelling, Elsevier, vol. 77(C), pages 289-300.
    16. Jorge Vieira & Rui Frade & Raquel Ascenso & Inês Prates & Filipa Martinho, 2020. "Generation Z and Key-Factors on E-Commerce: A Study on the Portuguese Tourism Sector," Administrative Sciences, MDPI, vol. 10(4), pages 1-17, December.
    17. Glawe, Linda & Wagner, Helmut, 2020. "China in the middle-income trap?," China Economic Review, Elsevier, vol. 60(C).
    18. José R. Sánchez-Fung, 2016. "Reviewing Trade Policy in China During the Transition to Balanced Economic Growth," The World Economy, Wiley Blackwell, vol. 39(12), pages 1934-1946, December.
    19. Metelli, Luca & Natoli, Filippo, 2017. "The effect of a Chinese slowdown on inflation in the euro area and the United States," Economic Modelling, Elsevier, vol. 62(C), pages 16-22.
    20. Weber, Enzo & Zhang, Yanqun, 2012. "Common influences, spillover and integration in Chinese stock markets," Journal of Empirical Finance, Elsevier, vol. 19(3), pages 382-394.

    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:gam:jsusta:v:13:y:2021:i:21:p:12267-:d:673640. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.