Financial asset allocation duality and enterprise upgrading: empirical evidence from the Chinese A-share market

Ke Guo (), Xuemeng Guo and Jun Zhang
Additional contact information
Ke Guo: Beijing Jiaotong University
Xuemeng Guo: Beijing Jiaotong University
Jun Zhang: Beijing Wuzi University

Palgrave Communications, 2023, vol. 10, issue 1, 1-11

Abstract: Abstract This study selects the financial data of Chinese non-financial listed companies from 2012 to 2021 as the research sample and empirically examines in detail the impact of financial asset allocation on enterprise upgrading and its mechanism. The study finds that financial assets have a dual influence on enterprise upgrading. Short-term financial assets provide the necessary funds for production activities, thus promoting enterprise upgrading. Long-term financial assets crowd out the funds needed for production activities and thus inhibit enterprise upgrading, resulting in an inverted U-shaped relationship between financial assets and enterprise upgrading. Mechanism testing revealed that risk-taking capacity and earnings persistence are important ways in which financial assets affect enterprise upgrading. In addition, the impact of financial assets on enterprise upgrading differs for different types of financial assets. The financial asset significantly impacts the upgrading of over-indebtedness, non-state-owned, and high financing constraints enterprises. This study enriches the research literature on financial assets and enterprise upgrading and provides new micro evidence for understanding the impact of financial assets on the enterprise upgrading of listed companies.

Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1057/s41599-023-01683-1 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palcom:v:10:y:2023:i:1:d:10.1057_s41599-023-01683-1

Ordering information: This journal article can be ordered from
https://www.nature.com/palcomms/about

DOI: 10.1057/s41599-023-01683-1

Access Statistics for this article

More articles in Palgrave Communications from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().