ORIGINAL RESEARCH article
Front. Phys.
Sec. Social Physics
Volume 13 - 2025 | doi: 10.3389/fphy.2025.1612653
This article is part of the Research TopicFinance and Production Complex SystemsView all 11 articles
Non-Financial Enterprises' Shadow Lending and SME Survival: The Role of Spatial Spillovers in Regional Financial Stability
Provisionally accepted
- Tianjin University, Tianjin, China
Select one of your emails
You have multiple emails registered with Frontiers:
Notify me on publication
Please enter your email address:
If you already have an account, please login
You don't have a Frontiers account ? You can register here
This study examines the impact of non-financial enterprises' shadow lending activities on the survival of small and micro enterprises (SMEs) in China. Utilizing panel data from 243 prefecture-level cities from 2012 to 2021 and applying the Spatial Durbin Model (SDM), we explore both direct and spatial spillover effects of shadow lending on SME mortality. Our empirical findings suggest that non-financial enterprises' shadow lending significantly reduces the local SME mortality rate, while spatial econometric analysis reveals positive spillover effects, whereby shadow lending in one region enhances SME survival in neighboring areas through cross-regional financial linkages. Heterogeneity analyses indicate that these effects are more prominent in the economically developed southeastern regions, while being relatively weaker in less-developed northwestern areas, reflecting disparities in financial accessibility. Robustness checks and lagged effect analyses confirm the consistency and persistence of our findings. While shadow banking improves SME resilience through regional transmission, it may also carry potential financial risks. This study innovatively focuses on the spatial spillover effects of shadow lending by nonfinancial enterprises on SME survival, an area largely overlooked by previous studies. By integrating spatial econometric analysis and examining systemic vulnerabilities, this paper provides new insights into the regional complexity of informal finance.
Keywords: shadow banking, non-financial enterprises, Spatial spillover, regional financial stability JEL Classification: G23, G32, R12, C31
Received: 16 Apr 2025; Accepted: 05 May 2025.
Copyright: © 2025 WANG, ZHANG, MENG and Xiong. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
* Correspondence: YONGQIANG MENG, Tianjin University, Tianjin, China
Disclaimer: All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article or claim that may be made by its manufacturer is not guaranteed or endorsed by the publisher.