The Impact Of Financial Connections On The Dual Innovation Investment Of Small And Medium Private Enterprises

Under the background of the implementation of innovation strategy,innovation has become an important way for enterprises to acquire and maintain competitive advantages.If enterprises want to achieve long-term development,they need to pursue both exploratory innovation and exploitative innovation.This poses a challenge for small and medium private enterprises in the face of resource scarcity.Based on its reputation mechanism and resource effect,financial connections have become an important channel to obtain innovative resources for SMEs.Some scholars have studied the impact of financial connections on the innovation,but they have neglected that different innovation modes have different resource demanding,that is,the impact of financial connections on different innovation modes will be different.How do financial connections affect SMEs' exploratory innovation and exploitative innovation? At the same time,the choice of enterprise innovation mode depends on the different external environment.Does environmental uncertainty affect the allocation of financial connections among different innovation modes of SMEs?Based on this,this paper studies the impact of executive financial connections on the dual innovation of SMEs using the data of financial connections and patent of small and medium-sized private-owned listed companies,and investigates the moderating effect of environmental uncertainty.The study finds that financial connections significantly promote the dual innovation of SMEs,and compared with exploratory innovation,financial connections have a more significant impact on the exploitative innovation of SMEs.Environmental uncertainty positively regulates the role of financial connections in promoting SMEs' exploratory innovation,but it can't significantly affect the relationship between financial connections and SMEs' exploitative innovation.After a series of robustness tests,such as variable substitution,propensity score matching,heckman two-stage model and treatment effect,the conclusions remain unchanged.After distinguishing different types of financial connections,we find that bank financial connection is more conducive to promoting the exploratory innovation,while non-bank financial connection is more conducive to promoting the exploratory innovation,and environmental uncertainty can enhance the positive correlation.The mechanism study shows that financial connection mainly promotes SMEs' innovation by obtaining financing and improving the risk-taking of management.At the same time,financial connection mainly influences SMEs' exploratory innovation through financing channels,and influences SMEs' exploratory innovation through risk-taking ability.This study not only enriches the research of the economic consequences of financial connections,but also improves the research on the influencing factors of dual innovation of SMEs.The conclusion of the study has certain theoretical and practical significance for guiding SMEs to make best use of financial connections and choose innovative modes to cope with changes in the external environment.