Stock Market Liberalization,Information Transparency And Corporate Innovation

Since the trial operation of Shenzhen Stock Exchange and Shanghai Stock Exchange in 1990,the capital market has developed from a "small sampan" to a "joint fleet",and the opening-up efforts have been gradually increasing while enriching the system level."Shanghai-Hong Kong Connect" scheme is an important system implemented by the central government to promote the internationalization of China’s capital market.At the same time,this exogenous event provides a rare"quasi-experimental environment".Using the sample of 2013-2016 A-share listed companies in Shanghai and the model of Staggered Difference In Differences,this thesis explores the relationship between stock market liberalization and corporate innovation based on information transparency mechanisms,and also further studies the influence of liquidity mechanism.The thesis finds that the "Shanghai-Hong Kong Connect" scheme significantly improves the innovation level of the underlying stocks,and that it is mainly due to information transparency mechanism rather than liquidity mechanism.Using analyst tracking and QFII holdings to measure corporate information transparency,this thesis also validates the "hidden incentive contract" hypothesis of information transparency mechanism.The implementation of the "Shanghai-Hong Kong stock connect" scheme improves the information transparency.Therefore the information of long-term R&D investment behavior can be better interpreted by the market and absorbed by the stock price,and the principal’s risk tolerance has also increased,thus alleviating the"shortsightedness" of professional managers,which is conducive to the implementation of long-term R&D strategy and the improvement of technological innovation ability.Further,this thesis finds that private enterprises and enterprises in regions with high level of marketization have better innovation capabilities.Private enterprises are more sensitive to market changes.The improvement of information transparency can help private enterprises make better positive feedback and promote substantive innovation.However,the innovation behavior of state-owned enterprises is greatly affected by other non-market factors,which leads to the limited effect.Only strategic innovation can be carried out,and the output of design patents is slightly improved.In addition,the effect of policy is also affected by the level of local marketization.The listed companies with higher degree of marketization can make more positive information feedback,so as to promote enterprise innovation.Under the background of China’s innovation-driven development strategy,the research provide experience and evidence for the implementation of future opening and internationalization of China’ s capital market.At the same time,we should continue to promote the reform of state-owned enterprises and regional marketization.By promoting the level of marketization and enterprise information transparency,we can improve the future development of enterprise innovation.