Short-term cross-border capital flows and corporate leverage ratio: China's empirical evidence and enlightenment

Yang, Haiyan; Luo, Haiyong; Hu, Yimei; Tan, Jianwei

doi:10.1016/j.procs.2023.08.016

Procedia Computer Science

2023

DOI: 10.1016/j.procs.2023.08.016

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Short-term cross-border capital flows and corporate leverage ratio: China's empirical evidence and enlightenment

Haiyan Yang

Haiyong Luo

Yimei Hu

et al.

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2024

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The impact of digital financial development on corporate leverage ratio: The case of a-share listed non-financial enterprises in China’s Shanghai and Shenzhen stock exchanges

Junqi,

Abbas,

Rongbing

et al. 2024

PLoS ONE

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This study investigates the impact of digital finance on corporate leverage ratios. The study employed a large sample of China’s Shanghai and Shenzhen A-share non-financial listed enterprises from 2011–2020. The study’s results depict that the development of digital finance can significantly reduce the leverage ratio of enterprises. We empirically identified that digital finance affects the difference in the term structure of the corporate leverage ratio. It was found that the development of digital finance has a significant negative impact on enterprises’ short-term and long-term leverage ratios. Moreover, our heterogeneity analysis shows that the negative effect of digital financial development on corporate leverage ratios is different in state-owned and non-state-owned enterprises, large-scale and small-scale enterprises, and high-leverage and low-leverage enterprises. Mechanism analysis shows that the development of digital finance can reduce corporate leverage by lowering financing costs, alleviating financing constraints, and weakening non-systemic risks. Therefore, policymakers should focus on developing and adopting digital finance by creating a supportive regulatory environment, improving access to digital financial services, and encouraging innovation in the digital finance sector. Finally, our results remain robust after addressing endogeneity issues and conducting robustness checks.

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The impact of digital financial development on corporate leverage ratio: The case of a-share listed non-financial enterprises in China’s Shanghai and Shenzhen stock exchanges

Junqi,

Abbas,

Rongbing

et al. 2024

PLoS ONE

View full text Add to dashboard Cite

show abstract

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Short-term cross-border capital flows and corporate leverage ratio: China's empirical evidence and enlightenment

Cited by 1 publication

References 9 publications

The impact of digital financial development on corporate leverage ratio: The case of a-share listed non-financial enterprises in China’s Shanghai and Shenzhen stock exchanges

The impact of digital financial development on corporate leverage ratio: The case of a-share listed non-financial enterprises in China’s Shanghai and Shenzhen stock exchanges

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