Integrating into the global innovation network and non-financial companies financialization——evidence from China-listed companies

Abstract

Using the data of Chinese listed companies from 2011 to 2021, we find that integration into the global innovation network reduces company financialization, this relationship is more pronounced in the eastern region, non-technology-intensive industries, and high-digital-level companies. The mechanism test shows that the integration improves main business performance to reduce financialization. We differentiate motivations of financialization and find that the integration restrains the manager's myopia tendency to reduce over-financialization of investment substitution motivation driven and reduces financing constraints to promote moderate-financialization of “reservoir” motivation driven. Our findings enrich the literature on financialization determinants and open innovation effects among emerging markets.