IDEAS home Printed from https://ideas.repec.org/a/eee/finana/v106y2025ics1057521925006404.html
   My bibliography  Save this article

Going out and bringing in: Impact of digital finance on firms' cross-regional investments

Author

Listed:
  • Zhu, Cuihua
  • Yu, Jingyuan

Abstract

Capital flows play a vital role in narrowing economic disparities across emerging markets. This study examines the impact of digital finance on the cross-regional investments (CRIs) of publicly listed companies in China using a comprehensive dataset from 2011 to 2021. Findings reveal that digital finance significantly promotes firm CRI by facilitating both outward investment (“going out”) and inward capital attraction (“bringing in”). These results remain robust across multiple validation methods, including Bartik instruments, placebo tests, and shock-based instrumental variable techniques. Mechanism analysis suggests that digital finance reduces both investment and financing costs while enhancing returns on investment. Heterogeneity analysis further reveals that the effects are more pronounced for nonstate-owned enterprises, asset-light firms, and merger-driven investments. These findings offer valuable implications for policymakers aiming to leverage digital finance to stimulate cross-regional capital flows in emerging economies.

Suggested Citation

  • Zhu, Cuihua & Yu, Jingyuan, 2025. "Going out and bringing in: Impact of digital finance on firms' cross-regional investments," International Review of Financial Analysis, Elsevier, vol. 106(C).
    • Handle: RePEc:eee:finana:v:106:y:2025:i:c:s1057521925006404
    DOI: 10.1016/j.irfa.2025.104553
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1057521925006404
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.irfa.2025.104553?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finana:v:106:y:2025:i:c:s1057521925006404. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620166 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.