The impact of artificial intelligence (AI) finance on financing constraints of non-SOE firms in emerging markets

Purpose: This study investigates the impact of AI finance on financing constraints of non-SOE firms in an emerging market. Design/methodology/approach: Using a sample of non-SOE listed companies in China from 2011 to 2018, this research employs the cash–cash flow sensitivity model to examine the effect of AI finance on financing constraints of non-SOE firms. Findings: We find that the development of AI finance can alleviate the financing constraints of non-SOE firms. Further, we document that such effect is more pronounced for smaller firms, more innovative firms and firms in developing areas. Practical implications: This study suggests that emerging market countries can ease the financing constraints of non-SOE firms by promoting AI finance development. Originality/value: This study, to the best of our knowledge, is the first one to explore the relationship between AI finance development and financing constraints of non-SOE firms in emerging markets.