Financialization Of Real Firms And Total Factor Productivity Under Economic Policy Uncertainty

At present,China’s economy has entered the stage of high-quality development,and high-quality development means high-efficiency operation of the economy.At the macro level,high-efficiency economic operation needs to be supported by the development of financialization of the economic,and at the micro level,high-efficiency economic operation means that enterprises of microeconomic subjects can maintain a high level of total factor productivity,which also means that enterprises can make full use of financial tools to serve the development of their enterprises,but with the profitability of the financial and real estate sectors significantly exceeding that of other sectors,the financialization of enterprises has been highlighted as a result of a larger flow of industrial capital to the financial sector,which is idling inside the virtual system apart from the real economy.Nowadays,globalization has become a major challenge,while China’s economic reform has entered into deep water,and the government often adjusts economic policies to minimize the negative impact of multiple shocks on China’s economic growth,which makes enterprises face the risk of frequent changes in economic policies.Based on this,it is important to know the impact of financialization of enterprises on total factor productivity in the context of economic policy uncertainty in order to maintain China’s global competitive position and high-quality economic development.In this paper,we select panel data of non-financial listed companies in China’s Shanghai and Shenzhen A-shares from 2010 to 2020,measure corporate financialization from the perspective of financial asset holdings,calculate total factor productivity using the LP method,and use the economic policy uncertainty index constructed by Baker et al.(2016)using the South China Morning Post to conduct an empirical test to analyze the impact of corporate financialization on total factor productivity;meanwhile,based on the macro-level economic policy environment perspective,we explore the moderating effect brought by economic policy uncertainty in China.In addition,this paper introduces two mediating variables,operating cash flow and technical innovation,to further verify the mediating mechanism of corporate financialization on total factor productivity.It is concluded that(1)corporate financialization inhibits total factor productivity enhancement,indicating that corporate financialization is motivated by speculative arbitrage at this stage;(2)rising economic policy uncertainty exacerbates the negative impact of corporate financialization on total factor productivity enhancement;(3)operating cash flow exhibits a masking effect between corporate financialization and total factor productivity;(4)technical innovation exhibits a partial mediating effect between financialization and total factor productivity.