Research On The Motivation Of Non-financial Enterprises' Financialization And Its Influence On Resource Allocation Efficiency

Non-financial enterprises are the representatives and pillars of the real economy.However,since 2012,China's non-financial enterprises have shown an obvious trend of financialization,with the proportion of financial assets allocated by enterprises and the proportion of income from financial channels continuously increasing.A certain degree of financialization helps to improve enterprises' Efficiency of capital utilization and financing,but judging from the current reality of China's economic,The deepening degree of enterprises financialization happens in the context of the slowdown of China's real economy.It cause concerns that Whether the financialization of enterprises will lead the economy from substantial to fictitious,make the enterprise abandon their main business,and in the end hurt the real economy.Since 2018,financial regulators have successively introduced policies and measures to restrict financial investment behaviors of enterprises,aiming to guide enterprises to focus on the development of their main business and avoid excessive financialization.Studies have shown that the impact of financialization on the economy is not always negative.When the profit margin of the real economy declines and even lower than the yield rate of financial investment,capital will flow to financial assets,which can improve the operating performance of enterprises to some extent,help smooth their investment,and enable enterprises to achieve a smooth transition in the process of economic structure transformation.In addition,the shadow banking activities of non-financial enterprises helps to improve the misallocation of financial resources caused by bank credit discrimination,so as to realize the secondary allocation of credit resources among enterprises.However,the existing studies only stop at the empirical test that non-financial enterprises will use external financing to invest financial assets,but do not further verify where the secondary allocation of financial resources flows,which is the key to judge whether enterprise financialization can optimize the allocation of financial resources.If the capital reallocated by financialization enterprises mainly flows to small and medium-sized private enterprises which have higher production efficiency but being excluded by bank credit,the financialization of enterprises will help optimize the capital allocation efficiency.On the other hand,if the capital reallocated by financialization enterprises still flows to the traditional inefficient industries or is used for speculative arbitrage in the financial and real estate fields,the financialization of enterprises cannot effectively optimize the capital allocation but may aggravate the financial mismatch.As a phenomenon that cannot be ignored in the process of China's structural reform,how is the current level of enterprise financialization in China?Does it show special characteristics?What is the motivation and driving mechanism of enterprise financialization?Will the financialization of enterprises crowd out industrial investment and aggravate the imbalance of economic structure,or will it help optimize the efficiency of financial resources allocation and improve the operating performance of enterprises?The study of these problems will help the regulatory authorities to regulate accurately and make finance better serve the real economy.Firstly,this paper starts with the analysis of the current situation,calculates the overall trend of the financialization of Chinese enterprises from 2007 to 2017,and analyzes the risk preference of Chinese non-financial enterprises in the allocation of financial assets and the heterogeneity among enterprises.Secondly,through the research on the motivation of enterprise financialization,it empirically tested whether enterprise financialization would discourage industrial investment.Finally,the thesis focuses on whether enterprise financialization can optimize the efficiency of financial resources allocation.By studying the business mechanism of enterprise's shadow banking activity,the impact of enterprise shadow banking on financing constraints of different enterprises,and the impact of inter-enterprise shadow credit financing on the development of the main business of micro enterprises,the impact of enterprise shadow banking on the efficiency of financial resource allocation is completely tested.The results of this paper show that:(1)The financialization of non-financial enterprises in China has great differences among different ownership nature,different industries and different regions.The lower the return on real business and the higher the leverage ratio,the more financial assets an enterprise holds,the higher the proportion of financial channel earnings will be.The supervision department should focus on supervising the financialization of non-financial enterprises involved in real estate investment and industries with excess capacity,and focus on preventing the leverage operation of enterprises in financial asset investment.(2)On the whole,the financialization of China's non-financial enterprises is mainly based on the precautionary saving motive,which helps smooth the fluctuation of fixed asset investment of enterprises in the future,and the smoothing effect is not significantly different among enterprises with different financing constraints.In addition to real estate investment,enterprises' allocation of trading financial assets,shadow banking financial assets and long-term equity investment can help smooth the future volatility of fixed asset investment.Financial asset allocation is more of a "reservoir" and"lubricant" for enterprise investment,which is used to adjust the pace of enterprise industrial investment and will not occupy industrial investment for a long time.(3)The higher the degree of financial repression,the greater the motivation and demand of enterprises' shadow banking activities to reallocate financial resources.(4)The financial resources redeployed by financialization enterprises did not flow to small and medium-sized private enterprises with more growth opportunities and bigger financing gap and to enterprises in emerging industries,but still flowed to large enterprises,state-owned enterprises and enterprises in traditional industries.The development of enterprise shadow banking only strengthens the original economic growth model,and the increasing degree of enterprise shadow banking will further squeeze the bank credit resources of small and medium-sized private enterprises,which cannot effectively improve the misallocation of financial resources.(5)Most of the financial resources redeployed by enterprises in shadow banking are short-term credit with high cost,which not only cannot effectively support the long-term project investment of enterprises,but also will worsen the investment efficiency of enterprises with insufficient investment,which is not conducive to the development of the main business of enterprises.To sum up,the unbalanced allocation of financial resources caused by financial repression is the reason for the development of enterprise shadow banking,but enterprise shadow banking cannot optimize the allocation efficiency of financial resources.To stop the trend of enterprises' shadow banking,the fundamental method is to improve the financial market environment,reduce the bank credit discrimination,and expand the legal financing channels for small and micro enterprises.The innovation of this paper lies in:(1)Based on the existing literature,this paper examines the motivation of enterprise financialization from the perspective of the ultimate use of enterprises' financial assets,and emphasizes the impact of different motivations on the real economy.(2)Deeply explores the business mechanism of enterprise shadow banking and the influence of macro-institutional factors on enterprise shadow banking.Based on the empirical results,this paper proposes that alleviating financial repression is the fundamental method to stop the trend of enterprise shadow banking.(3)Empirically examines the influence of corporate shadow banking on financial resource allocation efficiency in two steps,and finds that corporate shadow banking only strengthens the original economic growth model,but fails to effectively improve financial resource allocation efficiency and fills the existing research gap.