nach oben

Review of Managerial Science

Erschienen in:

07.03.2023 | Original Paper

Zombie firms and corporate financialization: evidence from China

verfasst von: Yumeng Wu, Haiying Pan

Erschienen in: Review of Managerial Science | Ausgabe 4/2024

Einloggen

Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.

search-config

KI-gestützte Suche

Aus

Abstract

Zombie firms are an important constraint to promote high-quality economic development. Based on the data of China’s A-share non-financial listed firms from 2008 to 2018, this paper discusses the impact of zombie firms on the level of corporate financialization and its mechanism of action by using the fixed effects model and mediation effect model. Our empirical results show that zombie firms exacerbate non-zombie firms’ corporate financialization, as the higher the proportion of zombie firms in the industry, the higher financialization of non-zombie firms, and the conclusions remain robust after considering endogeneity issues. Further analysis reveals that the financing constraints acts as a fully mediating role in zombie firms and non-zombie firms’ corporate financialization, which shows that zombie firms will increase the financing constraints of non-zombie firms and then may cause non-zombie firms to allocate financial assets. We also find that the impact of zombie firms on the financialization of non-zombie firms is more pronounced in the sample of non-state enterprises, low levels of regional financial development, and before the supply-side structural reforms proposed in 2015. The results of this study provide important theoretical guidance for accelerating the disposal of zombie firms.

Vorheriger Artikel When psychological contract violation inhibits affiliative and challenging behaviors: the roles of supervisor-subordinate guanxi and job control

Nächster Artikel Betting on the future: how to build antifragility in innovative start-up companies

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

über 102.000 Bücher
über 537 Zeitschriften

aus folgenden Fachgebieten:

Automobil + Motoren
Bauwesen + Immobilien
Business IT + Informatik
Elektrotechnik + Elektronik
Energie + Nachhaltigkeit
Finance + Banking
Management + Führung
Marketing + Vertrieb
Maschinenbau + Werkstoffe
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

über 67.000 Bücher
über 340 Zeitschriften

aus folgenden Fachgebieten:

Bauwesen + Immobilien
Business IT + Informatik
Finance + Banking
Management + Führung
Marketing + Vertrieb
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Ahearne AG, Shinada N (2005) Zombie firms and economic stagnation in Japan. IEEP 2(4):363–381CrossRef

Allen F, Qian J, Qian M (2005) Law, finance and economic growth in China. J Financ Econ 77(1):57–116CrossRef

Brandt L, Li H (2003) Bank discrimination in transition economies; ideology, information or incentives? J Comp Econ 31(3):387–431CrossRef

Caballero RJ, Hoshi T, Kashyap AK (2008) Zombie lending and depressed restructuring in Japan. Am Econ Rev 98(5):1943–1977CrossRef

Cai MR, Ren SC (2014) Corporate financialization: a literature review. Financ Econ 7:41–51

Chang JY, Zhou YY, Zhu XA (2022) An empirical test of the relationship between the financial background of CEOs of real firms and the financialization of assets. Stat Decis 38(6):164–168

Chen LJ (2022) Financing constraints, internal controls and enterprises financialization. Yangzhou University of business

Dai ZW, Pan SJ (2018) Will the “Virus” of zombie firms be contagious? Evidence based on the transparency of financial information. J Financ Econ 44(12):138–150

Davis GF, Kim S (2015) Financialization of the economy. Ann Rev Sociol 41(1):203–221CrossRef

Demir F (2009) Financial liberalization, private investment and portfolio choice: financialization of real sectors in emerging markets. J Dev Econ 88(2):314–324CrossRef

Deng C, Zhang M, Tang Y (2017) Influence factors of financialization of non-financial enterprises in China. Theory Pract Financ Econ 38(2):2–8

Du Y, Deng X (2020) Margin trading, short selling and firm financialization: based on a quasi-natural experiment of bath expansion. Finance & Trade Economics 41(2):69–83

Du Y, Zhou L (2019) Executive academic background and corporate financialization. J Southwest Univ Soc Sci Edit 45(6):63–74

Du Y, Zhang H, Chen JY (2017) The impact of financialization on future development of real enterprises’ core business: promotion or inhibition. China Ind Econ 12:113–131

Duchin R (2010) Cash Holdings and corporate diversification. J Finance 65(3):955–992CrossRef

Feng YM, Yu Q, Nan XH, Cai YB (2022) Can employee stock ownership plans reduce corporate financialization? Evidence from China. Econ Anal Policy 73:140–151CrossRef

Fukuda S, Nakamura J (2011) Why did zombie firms recover in Japan? World Econ 34(7):1124–1137CrossRef

Gordon T (1967) The welfare costs of tariffs, monopolies and theft. West Econo J 5:224–232

Guo XH, Ye JL, Su WH, Luo DM, Jin XR (2022) Do zombie firms crowd out healthy firms and slow their growth? Evidence from China. Dev Policy Rev 00:1–23

He F, Zhu H (2016) The recognition and solutions of zombie firms. China Financ 5:20–22

Hirata W (2010) Financial market imperfections and aggregate fluctuations. Boston College

Hoshi T, Kashyap AK (2004) Japan’s financial crisis and economic stagnation. J Econ Perspect 18(1):3–26CrossRef

Hoshi T, Kashyap AK (2011) Why did Japan stop growing? Nira report

Hu XL, Chen HL (2019) Government intervention and bank credit in the post-crisis era—from the perspective of state-owned economy. J Contemp Financ Res 3:74–87

Imai K (2015) A panel study of zombie SMEs in Japan: identification, borrowing and investment behavior. J Jpn Int Econ 39:91–107CrossRef

Jin XM, Mai Y, Cheung AWK (2022) Corporate financialization and fixed investment rate: evidence from China. Financ Res Lett 48:102898CrossRef

Kane EJ (1987) Dangers of capital forbearance: the case of the FSLIC and “zombie” S&Ls”. Contemp Econ Policy 5(1):77–83CrossRef

Kato K, Skinner DJ, Kunimura M (2006) When voluntary disclosure isn’t voluntary: management forecasts in Japan. Working papers. University of Economics

Khan KU, Xuehe Z, Atlas F, Khan F (2019) The impact of dominant logic and competitive intensity on SMEs performance: a case from China. J Innov Knowl 4(1):1–11CrossRef

Krippner G (2005) The financialization of the american economy. Soc Econ Rev 3(2):173–208CrossRef

Kwon HU, Narita F, Narita M (2015) Resource reallocation and zombie lending in Japan in the 1990s. Rev Econ Dyn 18(4):709–732CrossRef

Lan Q, Zhao PD (2014) Path analysis of financial development affecting energy industry investment efficiency. J China Univ Geosci Soc Sci Edi 14(6):48–54

Lassala C, Orero-Blat M, Ribeiro-Navarrete S (2021) The financial performance of listed companies in pursuit of the sustainable development goals (SDG). Econ Res Ekon Istraž 34(1):427–449

Lee MT, Suh I (2022) Understanding the effects of environment, social, and governance conduct on financial performance: arguments for a process and integrated modelling approach. Sustain Technol Entrepreneurship 1(1):100004CrossRef

Li XC, Lu JK, Jin XR (2018) Zombie firms and tax burden distortion. Manage World 34(4):127–139

Li XC, Liu DH, Jin XR (2021) The formation, hazard and handling of zombie firms: literature review and future research topics. J Beijing Technol Bus Univ Soc Sci 36(1):114–126

Liang JS, Zhang YS (2019) A study of the affecting factors on China’s regional financial development. Macroeconomics 7:14–24

Lin YP (2011) Zombie lending, financial reporting opacity and contagion. National University of Singa-pore

Liu HH, Jiao WN (2021) Banking competition and corporate financialization: based on the perspective of financing constraints. J Southwest Minzu Univ Humanit Soc Sci 42(8):78–91

Liu HH, Jiao WN (2022) State-owned equity participation, financial constraints and financial asset investment of private entrepreneurs. Mod Econ Res 41(4):70–82

Lu ZF, Zhu JG (2009) Monetary contractions, bank discrimination and non-state listed companies’ investor interests loss. J Financ Res 8:124–136

Peek J (2008) The contribution of bank lending to the long-term stagnation in Japan. Working paper. University of Kentucky

Peek J, Rosengren ES (2005) Unnatural selection: perverse incentives and the misallocation of credit in Japan. Am Econ Rev 95(4):1144–1166CrossRef

Peng YC, Han X, Li JJ (2018) Economic policy uncertainty and corporate financialization. China Ind Econ 35(1):137–255

Pfeffer J, Salancik GR (2003) The external control of organizations. A resource dependence perspective

Qi Y, Yang YD, Yang S, Lyu SM (2021) Does government funding promote or inhibit the financialization of manufacturing enterprises? Evidence from listed chinese enterprises. North Am J Econ Financ 58:101463CrossRef

Qi Y, Yang S, Yang YD, Hou ZM (2022) Influence of zombie firms on normal corporate environmental investment. China Popul Resour Environ 32(3):108–117

Qiao XL, Song L, Dai XY (2019) On the Chinese manufacturing zombie firms’ role in the misallocation of labor resources. Financ Trade Econ 40(11):113–128

San-Jose L, Urionabarrenetxea S, García-Merino JD (2021) Zombie firms and corporate governance: what room for maneuver do companies have to avoid becoming zombies? RMS 16(3):835–862CrossRef

Sean C (1999) The relationship between firm investment and financial status. J Financ 54(2):673–692CrossRef

Shao W, Sun YY, Bai X, Naeem MA, Taghizadeh-Hesary F (2022) Zombie enterprises, crowding out effect, and total factor productivity: empirical evidence from chinese manufacturing listed companies. Int J Financ Econom 1–20

Smith CW, Stulz RM (1985) The determinants of firms’ hedging policies. J Financ Quant Anal 20(4):391–405CrossRef

Su KS (2018) Research on the influence of government subsidy of zombie enterprise on the sustainable development of enterprise. Capital university of economics and business, Beijing

Sun YY (2019) The impact of zombie companies on the growth of TFP in normal enterprises—empirical analysis based on listed companies in manufacturing. Zhejiang university of finance and economics

Sun ZY, Qi BL (2022) Multiple major shareholders and the financialization of enterprises. J Ind Eng Eng Manag 36(3):62–77

Tan YY, Tan ZB, Huang YP, Hui YT (2017) The crowding- out effect of zombie firms: evidence from China’s industrial firms. Econ Res J 52(5):175–188

Urionabarrenetxea S, Garcia-Merino JD, San-Jose L, Retolaza JL (2018) Living with zombie companies: do we know where the threat lies? Eur Manag J 36(3):408–420CrossRef

Wang LG, Gao YQ (2014) Establishing and improving market exit mechanisms to effectively resolve overcapacity. Macroeconomics 10:8–21

Wang YQ, Zhu YY (2020) The financing and investment crowding-out effect of zombie firms on non-zombie firms: evidence from China. Emerg Mark Financ Trade 2:1–27

Wang HJ, Cao YQ, Yang Q, Yang Z (2017) Does the financialization of non-financial enterprises promote or inhibit corporate Innovation. Nanki Bus Rev 20(1):155–166

Wang YQ, Li W, Dai Y (2018) How do zombie firms affect innovation?—evidence from China’s industrial firms. Econ Res J 53(11):99–114

Wang FR, Zheng ZQ, Mu QY (2019) How do Zombie companies affect normal corporate risk-taking? An empirical study based on listed enterprises in China’s manufacturing industry. Bus Manag J 41(10):37–53

Wen ZL, Zhang L, Hou JT (2006) Mediated moderator and moderated mediator. Acta Physiol Sin 3:448–452

Wu YM, Pan HY (2021) Can pay-performance sensitivity cure zombie firms? Evidence from China. Manag Decis Econ 43(4):1080–1090CrossRef

Yang Z, Wang HJ, Dai J, Xu CH (2019) Deregulation of interest rates, equalization of profit-rate, and enterprises’ shift from real to virtual. J Financ Res 40(6):20–38

Ye Y, Chen S, Li C (2022) Financial technology as a driver of poverty alleviation in China: evidence from an innovative regression approach. J Innov Knowl 7(1):100164CrossRef

Yu M, Guo YM, Wang D, Gao XH (2021) How do zombie firms affect debt financing costs of others: from spillover effects views. Pac Basin Financ J 65:101471CrossRef

Zhang CS, Zhang BT (2016) The falling real investment puzzle: a view from financialization. Econ Res J 51(12):32–46

Zuo Z, Lin Z (2022) Government R&D subsidies and firm innovation performance: the moderating role of accounting information quality. J Innov Knowl 7(2):100176CrossRef

Titel: Zombie firms and corporate financialization: evidence from China
verfasst von: Yumeng Wu
Haiying Pan
Publikationsdatum: 07.03.2023
Verlag: Springer Berlin Heidelberg
Erschienen in: Review of Managerial Science / Ausgabe 4/2024
Print ISSN: 1863-6683
Elektronische ISSN: 1863-6691
DOI: https://doi.org/10.1007/s11846-023-00633-0

Springer Professional

Abstract

Bitte loggen Sie sich ein, um Zugang zu Ihrer Lizenz zu erhalten.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Springer Professional "Wirtschaft"

Weitere Artikel der Ausgabe 4/2024

The GenAI is out of the bottle: generative artificial intelligence from a business model innovation perspective

Family ownership and control as drivers for environmental, social, and governance in family firms

Unlocking the connection between education, entrepreneurial mindset, and social values in entrepreneurial activity development

The social mission works: internalizing the mission to achieve organizational performance in social enterprises

Relationship conflict and counterproductive work behavior: the roles of affective well-being and emotional intelligence

When psychological contract violation inhibits affiliative and challenging behaviors: the roles of supervisor-subordinate guanxi and job control

Premium Partner