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Analysis of corporate financialization behavior and its influencing factors under external demand shocks

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  • Guo, Yanan
  • Wang, Hengyan
  • Wu, Yunyun

Abstract

This paper examines the impact of external demand shocks on corporate financialization among China's A-share listed companies from 2012 to 2022. Our findings reveal that adverse external demand shocks significantly elevate the level of corporate financialization. Speculators' sentiment moderates this relationship, weakening the positive effect of external demand shocks on corporate financialization. Furthermore, adverse external demand shocks mitigate corporate financialization by reducing managerial overconfidence. Notably, both state-owned enterprises (SOEs) and non-SOEs tend to increase financial asset allocation in response to adverse external demand shocks, with non-SOEs exhibiting a more pronounced tendency.

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  • Guo, Yanan & Wang, Hengyan & Wu, Yunyun, 2025. "Analysis of corporate financialization behavior and its influencing factors under external demand shocks," Finance Research Letters, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:finlet:v:77:y:2025:i:c:s1544612325003277
    DOI: 10.1016/j.frl.2025.107063
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