Corporate financialization, financing constraints, and innovation efficiency—Empirical evidence based on listed Chinese pharmaceutical companies

Zhu, Jialin; Tang, Yaning; Wei, Yanyi; Wang, Su; Chen, Yu‐Wen

doi:10.3389/fpubh.2023.1085148

Cited by 4 publications

(3 citation statements)

References 45 publications

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“…Thus, Polish companies, while achieving satisfactory results from operative activities, are not interested in additional income from financial activities. The discrepancy between the income obtained in the real sphere and the financial sphere is also noticeable in enterprises operating in other economies (Cupertino et al, 2019(Cupertino et al, , p. 1836Zhu et al, 2023).…”

Section: Discussionmentioning

confidence: 99%

Influence of financialization on the business activity of non-financial enterprises in Poland

Rydzewska

2023

EiP

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Motivation: Financialization is connected with the phenomenon of dominance of the financial sphere in relation to the real sphere. Financialization, when applied to non-financial entities, means the increase of importance of financial motives in the decision-making processes of enterprises. Changes result from transformations of the system of economic incentives and development patterns, both in the economy and among economic entities, which are focused on fast earning. Enterprises for that purpose, they use leverage and financial instruments to generate profit, limiting the operational and investment activity.Aim: The aim of this paper is to examine if the processes of financialization have affected the activities of non-financial enterprises operating in Poland based on a multifaceted analysis of the financialization of enterprises: from the point of view of investment activities (assets), sources of external financing (liabilities), income and management. Moreover, an attempt was made to answer the question if these processes apply equally to particular industries and enterprises according to their size.Results: The conducted research showed that non-financial enterprises operating in Poland do not show signs of financialization of their activities. There is a noticeable upward trend in active and passive financial instruments of the balance sheet total. However, it does not translate into an increase in financial income. Research related to factors affecting ROE as a measure of shareholder value assessment, showed that it is determined by operating performance. In addition, the research showed that there were no statistically significant differences in the financialization of operations between large companies and the SME sector. With regard to sectors, the research indicated that there were sectors that differed from the others. In terms of the degree of financialization of assets, liabilities and income, it is sector L — “Real estate activities”.

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Section: Discussionmentioning

confidence: 99%

Influence of financialization on the business activity of non-financial enterprises in Poland

Rydzewska

2023

EiP

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“…Given the capital constraints and profit imperatives, enterprises on their own often struggle to achieve significant innovative outputs. Consequently, external financial support and guidance become crucial in elevating their innovation capabilities [46,47]. This need becomes more pronounced in the context of high-quality innovations, which entail higher costs and greater uncertainties, underscoring the imperative for external assistance [48].…”

Section: Hypothesis 1 (H1) Ceteris Paribus Lglfd Can Inhibit Uiqmentioning

confidence: 99%

Drinking Poison to Quench Thirst: Local Government Land Financial Dependence and Urban Innovation Quality

Xu,

Yang,

Yang

et al. 2024

Land

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Many emerging markets rely on land financing, whereby land grants are used to raise funds for the government. In the short term, land financing eases the government’s fiscal deficit and boosts regional economic development. However, the long-term implications of such behaviour have not been adequately discussed. This study focuses on the relationship between local government land finance dependence (LGLFD) and urban innovation quality (UIQ). We find that LGLFD significantly inhibits the improvement of UIQ, and this inhibition occurs through three main channels: changing government spending preferences, reducing financial efficiency, and deteriorating the institutional environment. Our empirical study analyses 3662 samples from 264 Chinese cities from 2003 to 2016, confirming our research hypothesis. Further research finds that there is significant heterogeneity in the effect of LGLFD on UIQ. Based on these conclusions, some policy implications are proposed.

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“…In a good financial environment, companies constrained by financing are more likely to obtain external financing [4]. Domestic scholars such as Wei Zhihua [5] also believe that corporate financing constraints are related to the good or bad financial environment. Political connections are also one reason for financing constraints.…”

Section: Influencing Factorsmentioning

confidence: 99%

The Solution Strategies of Financing Constraint Predicament of Digitalized Empowerment of Micro-, Small and Medium-sized Enterprises

Liu

2023

AEMPS

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Micro-, small and medium-sized enterprises (MSMEs) have been an important part of our country's economy for many years. However, their survival and development are always affected by the phenomenon of financing constraints, which has resulted in non-negligible consequences for the development of the national economy. This paper utilizes with a large amount of data and information, and uses the method of induction and deduction to summarize the reasons for the financing constraint phenomenon from three levels, and puts forward corresponding solutions for different levels. The causes of financing constraints are divided into three levels. First, at the micro level, MSMEs cannot meet the expectations of investors and the requirements of mortgage loans. Secondly, at the industry level, due to the relative backwardness of the capital market. Finally, at the national level, local governments have not fundamentally solved the problems of financing difficulty and slow financing for MSMEs. In order to solve the above problems, this paper puts forward three different solutions. At the enterprise level, the enterprise should actively use digital technology to improve its own operating capability and operational compliance; Small and medium-sized banks should use new media and other technologies to strengthen ties with customers and improve service quality and data processing capabilities. At the industry level, big banks should help the small and medium-sized banks to accelerate the digital transformation. At the national level, local governments should provide policies including but not limited to financial support for the digital transformation of MSMEs.

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Corporate financialization, financing constraints, and innovation efficiency—Empirical evidence based on listed Chinese pharmaceutical companies

Cited by 4 publications

References 45 publications

Influence of financialization on the business activity of non-financial enterprises in Poland

Influence of financialization on the business activity of non-financial enterprises in Poland

Drinking Poison to Quench Thirst: Local Government Land Financial Dependence and Urban Innovation Quality

The Solution Strategies of Financing Constraint Predicament of Digitalized Empowerment of Micro-, Small and Medium-sized Enterprises

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