Market Competition,Financial Innovation and Systemic Risk Taking of Listed Financial Institutions
With the continuous deepening of financial supply-side structural reform in China,the market competition within the financial industry is intensifying.Financial institutions are proactively exploring various innovations to enhance prof-itability.It is crucial not to overlook the potential for these innovations to introduce systemic risk.This paper constructs a unified analysis framework for market competition,financial innovation and systemic risk from a theoretical perspective.A key discovery is the nonlinear relationship between financial innovation and systemic risk,contingent on the degree of market competition.Building on this,the paper utilizes a threshold regression model to conduct an empirical analysis of listed financial institutions.Results show that,during the low-competition stage,financial innovation increases sys-temic risk;in the medium competition stage,financial innovation inhibits systemic risk;in the high-competition stage,the ef-fects of financial innovation on systemic risk show noticeable distinctions between banks and securities.To further unveil the underlying risk mechanism,this paper uses the textual analysis method to construct sub-indicators of financial innovation in three dimensions:product,service and technology.It is found that the risk inhibition effect of innovation in the securities indus-try originates from the positive role of product,service and technology,while innovation in the banking industry has contributed to the accumulation of systemic risk due to the invention of complex and integrated financial products and the excessive use of financial technology.Therefore,this paper suggests that financial institutions should steadily promote products and services innovation based on their own strengths.Additionally,the adoption of emerging technologies should be based on their capabilities and condi-tions,with attention paid to the prevention of technological risks.As for government regulation,regulators should encourage healthy competition in the financial sector,and promote moderate regulation of financial innovation.
万方数据
维普
