Advances in Economics, Management and Political Sciences

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Advances in Economics, Management and Political Sciences

Series Vol. 2 , 22 March 2023


Open Access | Article

Economic Policy Uncertainty and Financial Innovation: Evidence from Commercial Bank in China

Chunhui Yuan 1 , Pengfei Sun * 2
1 Beijing University of Posts and Telecommunications
2 Beijing University of Posts and Telecommunications

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 2, 36-48
Published 22 March 2023. © 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Chunhui Yuan, Pengfei Sun. Economic Policy Uncertainty and Financial Innovation: Evidence from Commercial Bank in China. AEMPS (2023) Vol. 2: 36-48. DOI: 10.54254/2754-1169/2/2023018.

Abstract

The empirical results show that the rise of economic policy uncertainty (EPU) makes the level of financial innovation at banks significantly improve; that is, there is an incentive effect of EPU on financial innovation at banks. In addition, the degree of incentive-induced EPU for different types of banks is significantly different. Compared with listed banks, this incentive effect is more significant for non-listed banks; rural commercial banks are the most significant incentive, followed by urban commercial banks, and state-owned banks and joint-stock commercial banks are more robust. This shows that EPU has a “selective effect” on bank financial innovation. Moreover, the incentive effect of EPU on financial innovation activities is affected by the return on assets and the asset liquidity ratio of commercial banks, which further validates the “selective effect” of financial policy uncertainty on bank financial innovation.

Keywords

Commercial Bank, Financial Innovation, Economic Policy Uncertainty, Heterogeneity

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Data Availability

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Volume Title
ISBN (Print)
ISBN (Online)
Published Date
22 March 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/2/2023018
Copyright
© 2023 The Author(s)
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated