Competition in the Banking Industry, Corporate Strategy, and Reshaping of Global Value Chain Position: An Empirical Study Using Chinese Industrial Enterprises as Samples

Abstract

This research investigates how competitive dynamics in China's financial sector influence firms' global value chain (GVC) positioning, utilizing branch distribution data from prefecture-level cities to construct two key competition metrics: the Herfindahl-Hirschman Index (HHI) and the four-firm concentration ratio (CR4). Empirical results demonstrate a non-linear association between financial market competition and corporate GVC status, where early-stage suppressive effects transition into positive impacts as competition intensifies. These empirical outcomes maintain statistical significance after incorporating control variables including regional financial development indicators, fiscal health measures, and temporal markers of financial crises. Building upon the benchmark regression results, the study identifies cities where the impact of banking competition on enterprise GVC positioning exceeds the critical threshold. Mechanism analysis demonstrates that the banking industry supports enterprises' GVC advancement through two key channels: facilitating technological innovation and promoting service-orientated manufacturing transformation, and correcting financial resource misallocation while fostering the development of medium- and high-tech enterprises. Furthermore, moderation effect analysis reveals a complementary relationship between fintech and banking competition, whereas financial scale exhibits a substitution effect with banking competition. This research provides significant insights for optimising China's banking market structure, enhancing the international competitiveness of export enterprises, and fostering synergistic development between the financial sector and the real economy.