Moderation Of Corporate Financialization And Corporate Innovation

In recent years,the relationship between financial development and the real economy has drawn world widely attention,especially after the subprime mortgage crisis,the new theory-"too much finance" revealed the “threshold effect” between finance and economic growth.The financialization of entity enterprises is a microscopic manifestation of economic financialization.From the microscopic perspective,using the sample of China's Shanghai and Shenzhen A-share listed companies from 2008 to 2017,this paper fits the optimal financialization level of the sample companies,and discriminates the appropriateness of financialization.Then,the dynamic changes in the relationship between corporate financialization and innovation were examined.The study finds that there is also a threshold effect in corporate financialization.If the threshold is exceeded,over-financialization will hinder innovation.On the contrary,within the appropriate financialization level,corporate finance will promote innovation.In a word,the relationship between the two depends on moderation.Studying corporate financialization from the perspective of appropriateness has important theoretical and practical significance for effectively classifying and supervising the problem of “over-financialization” and “de-virtualization”,and promoting the growth of innovation investment in Chinese enterprises.