IDEAS home Printed from https://ideas.repec.org/a/plo/pone00/0298734.html
   My bibliography  Save this article

Industrial technology progress, digital finance development and corporate risk-taking: Evidence from China’s listed firms

Author

Listed:
  • Xiya Wu
  • Yanghui Liu
  • Biru Xia

Abstract

Industrial technological progress, as an essential industrial-technological and institutional phenomenon, brings with it the possibility of high profits for firms but also implies new norms and rules of competition, which affect the willingness and propensity of firms to bear the costs of undertaking venture capital projects. This study empirically investigates the causal impact of industrial-technological progress on corporate risk-taking and the mechanism of digital financial growth on the relationship between the two, based on data from China’s A-share listed businesses from 2011 to 2020. This paper finds that (1) industrial technological progress improves enterprise risk-taking levels. Moreover, digital financial development has an incentive effect on industrial technological progress and enterprise risk-taking levels. (2) Industrial technological progress under digital financial development generates financing constraint relaxation effects, input capital return enhancement effects, and innovation performance incentive effects, increasing enterprise risk-taking. (3) The positive moderating effect of digital financial development on the relationship between industrial technological progress and the risk-taking level of enterprises in the eastern regions and enterprises in the high-tech industry is more prominent. The study’s findings provide a theoretical foundation and policy insights on the crucial elements of industrial-technological progress and enterprises’ increased ability to take risks throughout the development of digital finance.

Suggested Citation

  • Xiya Wu & Yanghui Liu & Biru Xia, 2024. "Industrial technology progress, digital finance development and corporate risk-taking: Evidence from China’s listed firms," PLOS ONE, Public Library of Science, vol. 19(3), pages 1-19, March.
    • Handle: RePEc:plo:pone00:0298734
    DOI: 10.1371/journal.pone.0298734
    as

    Download full text from publisher

    File URL: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0298734
    Download Restriction: no
    File URL: https://journals.plos.org/plosone/article/file?id=10.1371/journal.pone.0298734&type=printable
    Download Restriction: no
    File URL: https://libkey.io/10.1371/journal.pone.0298734?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
    ---><---

    References listed on IDEAS

    as
    1. Coles, Jeffrey L. & Daniel, Naveen D. & Naveen, Lalitha, 2006. "Managerial incentives and risk-taking," Journal of Financial Economics, Elsevier, vol. 79(2), pages 431-468, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ilona Babenko & Benjamin Bennett & John M Bizjak & Jeffrey L Coles & Jason J Sandvik, 2023. "Clawback Provisions and Firm Risk," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 12(2), pages 191-239.
    2. Leon Zolotoy & Don O’Sullivan & Keke Song, 2021. "The Role of Ethical Standards in the Relationship Between Religious Social Norms and M&A Announcement Returns," Journal of Business Ethics, Springer, vol. 170(4), pages 721-742, May.
    3. Katsiaryna Bardos & Steven E. Kozlowski & Michael R. Puleo, 2021. "Entrenchment or efficiency? CEO‐to‐employee pay ratio and the cost of debt," The Financial Review, Eastern Finance Association, vol. 56(3), pages 511-533, August.
    4. Ng, Joe Cho Yiu & Leung, Charles Ka Yui & Chan, Suikang, 2022. "Corporate Real Estate Holding and Stock Returns: International Evidence from Listed Companies," MPRA Paper 111691, University Library of Munich, Germany.
    5. Zhao, Hong & Shen, Hao & Wang, Haizhi & Zhu, Yun, 2024. "State corporate tax changes and bond pricing: U.S. evidence," International Review of Financial Analysis, Elsevier, vol. 92(C).
    6. King, Timothy & Srivastav, Abhishek & Williams, Jonathan, 2016. "What's in an education? Implications of CEO education for bank performance," Journal of Corporate Finance, Elsevier, vol. 37(C), pages 287-308.
    7. Vu Quang Trinh & Neelu Seetaram & Kiet Tuan Duong & Xuan Vinh Vo, 2023. "Collusive behaviour, risk and performance of tourism firms," Tourism Economics, , vol. 29(8), pages 2103-2128, December.
    8. Francis, Bill & Hasan, Iftekhar & Sharma, Zenu, 2011. "Leverage and growth: Effect of stock options," Journal of Economics and Business, Elsevier, vol. 63(6), pages 558-581.
    9. Hsin-Hui Chiu & Eva Wagner, 2020. "CEO Bonus Pay and Firm Credit Risk," International Journal of Risk and Contingency Management (IJRCM), IGI Global, vol. 9(1), pages 1-19, January.
    10. Koharki, Kevin & Watson, Luke, 2025. "Risk-taking incentives and firm credit risk11The authors thank Kristine W. Hankins (editor), the anonymous associate editor and two anonymous reviewers, workshop participants at Lehigh University, Nor," Journal of Corporate Finance, Elsevier, vol. 91(C).
    11. Jiyeon Yun & James M. Carson & David L. Eckles, 2023. "Executive compensation and corporate risk management," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 90(2), pages 521-557, June.
    12. Correa, Ricardo & Goldberg, Linda S., 2022. "Bank complexity, governance, and risk," Journal of Banking & Finance, Elsevier, vol. 134(C).
    13. Nadia Loukil & Ouidad Yousfi, 2022. "Do CEO’s traits matter in innovation outcomes?," Journal of International Entrepreneurship, Springer, vol. 20(3), pages 375-403, September.
    14. Chakraborty, Atreya & Gao, Lucia Silva & Sheikh, Shahbaz, 2019. "Managerial risk taking incentives, corporate social responsibility and firm risk," Journal of Economics and Business, Elsevier, vol. 101(C), pages 58-72.
    15. Jaeyoung Sung, 2022. "Optimal contracting under mean-volatility joint ambiguity uncertainties," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 74(2), pages 593-642, September.
    16. Dirk E. Black & Ervin L. Black & Theodore E. Christensen & Kurt H. Gee, 2022. "Comparing Non-GAAP EPS in Earnings Announcements and Proxy Statements," Management Science, INFORMS, vol. 68(2), pages 1353-1377, February.
    17. Michael K. Fung, 2019. "Fraudulent Financial Reporting and Technological Capability in the Information Technology Sector: A Resource-Based Perspective," Journal of Business Ethics, Springer, vol. 156(2), pages 577-589, May.
    18. Özgür, Arslan-Ayaydin & Thewissen, James & Torsin, Wouter, 2021. "Earnings Management Methods and CEO Political Affiliation," LIDAM Discussion Papers LFIN 2021017, Université catholique de Louvain, Louvain Finance (LFIN).
    19. Mara Faccio & Maria-Teresa Marchica & Roberto Mura, 2011. "Large Shareholder Diversification and Corporate Risk-Taking," The Review of Financial Studies, Society for Financial Studies, vol. 24(11), pages 3601-3641.
    20. Mazumder, Sharif & Rao, Ramesh, 2023. "Social trust and the choice between bank debt and public debt: Evidence from international data," Journal of Multinational Financial Management, Elsevier, vol. 67(C).

    More about this item

    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:plo:pone00:0298734. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: plosone (email available below). General contact details of provider: https://journals.plos.org/plosone/ .

    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.