 How does fintech affect bank risk? A perspective based on financialized transfer of government implicit debt riskJiaxin Wang, Xiang Huang, Qiankun Gu, Zilong Song and Ruiyi Sun Economic Modelling, 2023, vol. 128, issue C Abstract: The relationship between government implicit debt risk and bank risk has drawn much academic attention. Prior studies have documented the mixed effect of fintech on financial stability, and little attention has been paid to its impact in the presence of government implicit debt risk. This paper investigates the impact of fintech on the transfer of governments' implicit debt risk to commercial banks using bank-level data of Chinese commercial banks from 2014 to 2019. With manually collected financial blockchain policy data, we find that the financial blockchain curbs the spillover of government implicit debt risk to commercial banks. The widening of LGFVs financing channels and generation of the real economic effects are proven to be two crucial mechanisms. Inhibitory effects are heterogeneous between different levels of regional financial and digital economic development and officials’ promotion pressure. This study provides new insights for policymakers to develop fintech and strengthen government debt governance. Keywords: Financial blockchain; Government implicit debt; LGFVs financing channels; Real economic effect (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:128:y:2023:i:c:s0264999323003103 DOI: 10.1016/j.econmod.2023.106498 Access Statistics for this article Economic Modelling is currently edited by S. Hall and P. Pauly More articles in Economic Modelling from Elsevier |
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