Work

Bank competition and corporate financialization: evidence from China

Year: 2022

Type: article

Abstract: By integrating the banks and firms’ latitude and longitude information, this study innovatively constructs firm-level bank competition indicators, and systematically examines the mechanism of bank competition on the financialization of nonfinancial listed companies. The findings revealed that bank competition could promote corporate financialization. The result is still valid after several robustness tests and consideration of endogenous issues. Bank competition primarily affects corporate financialization through two channels: easing corporate financial constraints and decreasing corporate loan costs. Moreover, this role is even more apparent in non-state-owned firms and well-managed firms.

Source: Asia-Pacific Journal of Accounting & Economics

DOI: 10.1080/16081625.2022.2147968

Authors: Qilong Cao, Jinglei Li

Institution: Changzhou University

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: hybrid

Funder: Changzhou University