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Does corporate financialization affect the growth of main business? An empirical study of Chinese A-share non-financial listed companies

Jundong Chen, Biao Zhong


Financialization of non-financial companies, referring to investing more on financial assets instead of main business, is a noticeable trend among Chinese listed companies, especially in recent years. Based on the annual panel data of Chinese A-share non-financial listed companies on the Shanghai Stock Exchange and the Shenzhen Stock Exchange from 2014 to 2019, this article analyzes the relationship between financialization and the growth of main business. Results suggest that financialization of non-financial companies has a “crowding-out effect” on industrial reinvestment, and state-owned enterprises, compared with private listed companies, are less likely to be affected by the increase of financial assets.


financialization; non-financial listed companies; main business; growth; crowding-out effect

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DOI: http://dx.doi.org/10.18686/fm.v6i2.3408