Research On The Influence Of Cross-shareholding Network On Enterprise Innovation

Innovation is considered as the primary driving force for economic development.Given the current global economic slowdown and the increasing downward pressure on the domestic economy,it is imperative to transform the economic development model.Implementing an innovation-driven development strategy has become a powerful engine for achieving China’s economic transformation.The report of the 20 th National Congress of the Communist Party of China pointed out that "to strengthen the main position of innovation in enterprises,play a leading role in supporting the backbone enterprises".As a microscopic subject of innovation,enterprises are a key focus for the development of national industrial innovation and transformation.However,due to the secrecy of the innovation process and the uncertainty of innovation output,investment risk is increased,making it difficult for innovation activities to be favored by investors and for financing innovation activities.With the rapid development of China’s capital market,cross-shareholding among listed companies has become more prevalent.This has led to the formation of a cross-shareholding network with enterprises as nodes and equity relations as ties.The network provides an efficient platform for sharing professional information and key resources among enterprises.Enterprises located at the center of the cross-shareholding network have more resources and information,which helps alleviate financing constraints.The question remains whether the information and resource advantages of cross-shareholding networks can promote innovation by alleviating financing constraints,and whether the relationship between the two differs under different IP protection environments.These questions are worth exploring in depth.This paper explores the impact of cross-shareholding networks on firms’ innovation investment by using cross-shareholding data of A-share listed companies in Shanghai and Shenzhen from 2007 to 2021.We construct the cross-shareholding network for each year and calculate the centrality index and structural hole index of enterprises using the Network X package of Python.We use social network theory,resource base theory,and information asymmetry theory as the theoretical basis to investigate the impact of cross-shareholding networks on firms’ innovation investment,test the mediating role played by financing constraints,and confirm the moderating role of intellectual property protection strength.Our results indicate that cross-shareholding networks effectively promote corporate innovation,as the higher the centrality or the richness of structural holes in the cross-shareholding network,the higher the innovation input and output of the firm.Moreover,financing constraints play a mediating role between cross-shareholding networks and corporate innovation.Cross-shareholding networks alleviate financing constraints and enhance the level of corporate innovation inputs.Additionally,the impact of cross-shareholding networks on firms’ innovation investment is more significant in an environment with weaker intellectual property protection.Our study enriches the research on cross-shareholding networks and explores its impact on enterprise innovation from a novel perspective,providing new ideas for firms to increase their innovation input intensity and improve their innovation output.Furthermore,we reveal the impact of cross-shareholding networks on enterprises’ innovation investment under different environments of knowledge protection,which provides theoretical references and decision bases for government departments to formulate policies suitable for their own development.