Statistical and bibliometric analysis of financial innovation

Abstract

Purpose

The purpose of this paper is to review and analyze the characteristics of the literature related to financial innovation, because financial technology (fintech) has been appropriately applied in academic circles as well as in the policy-making arena. The authors further estimate the implications of financial innovations for bank performance and liquidity risk.

Design/methodology/approach

The authors use a sample of commercial banks operating in Taiwan over the period 2010–2017 and utilize three proxies for financial innovation including R&D expenditures, financial patents (i.e. innovation applications) and financial news such as that concerning fintech (i.e. innovation intentions).

Findings

The effects of financial innovation on bank performance are mixed, with too much of R&D expenditures having the worst bank performance, whereas innovation intentions benefit their performance. The paper concludes that financial innovation does increase banks’ liquidity risk, thus supporting the innovation-fragility hypothesis.

Originality/value

It is an important issue in academic circles as well as in the policy-making arena to ensure that financial innovation has been appropriately applied.

Citation

Chen, T.-H. and Peng, J.-L. (2020), "Statistical and bibliometric analysis of financial innovation", Library Hi Tech, Vol. 38 No. 2, pp. 308-319. https://doi.org/10.1108/LHT-09-2018-0140