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Blockchain technology, macroeconomic uncertainty and investment efficiency

Author

Listed:
  • Wanyi Chen
  • Kang He
  • Lanfang Wang

Abstract

Purpose - In addition to leading a new tide of global financial technology, blockchain delivers advantages in terms of risk control compared to traditional financial systems. By exploring the relationship between blockchain technology and macroeconomic uncertainty, this study aims to identify the hedge risk attribute of blockchain technology. Design/methodology/approach - From a data set comprising 6,323 Chinese firms with A-shares listed on the Shenzhen and Shanghai Stock Exchanges in 2015–2018, the authors obtain the use of blockchain technology by listed companies on the basis of annual reports, news reports, search engines and prospectuses. These documents are then subjected to text analyses based on computer technology. Cross-sectional and propensity score matching analyses are used to ensure robustness. Findings - The empirical results show that with an increase in macroeconomic uncertainty, blockchain technology can potentially enable companies to reduce their systemic risks and enhance their investment efficiency. Originality/value - This study expands the literature on the application of blockchain technology, offers references for enterprises to address future risks based on specific macroeconomically uncertain environments and provides guidelines for governments to maintain financial market stability.

Suggested Citation

  • Wanyi Chen & Kang He & Lanfang Wang, 2021. "Blockchain technology, macroeconomic uncertainty and investment efficiency," International Journal of Emerging Markets, Emerald Group Publishing Limited, vol. 18(7), pages 1493-1514, June.
    • Handle: RePEc:eme:ijoemp:ijoem-10-2020-1250
    DOI: 10.1108/IJOEM-10-2020-1250
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    Citations

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    Cited by:

    1. Zhang, Yujin & Ye, Shujun & Liu, Jie & Du, Lihong, 2023. "Impact of the development of FinTech by commercial banks on bank credit risk," Finance Research Letters, Elsevier, vol. 55(PA).
    2. Abakah, Emmanuel Joel Aikins & Wali Ullah, GM & Adekoya, Oluwasegun B. & Osei Bonsu, Christiana & Abdullah, Mohammad, 2023. "Blockchain market and eco-friendly financial assets: Dynamic price correlation, connectedness and spillovers with portfolio implications," International Review of Economics & Finance, Elsevier, vol. 87(C), pages 218-243.

    More about this item

    Keywords

    Blockchain technology; Corporate risk; Investment efficiency; Macroeconomic uncertainty; Hedge risk; E22; E32; G31;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies

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