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Does participating in the standards-setting process promote innovation? Evidence from China

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  • Zhang, Mao
  • Wang, Yiming
  • Zhao, Qifeng

Abstract

This paper provides novel empirical evidence on the positive effect of standards-setting involvements on corporate innovation in China, reflecting in improving the patent quantity and patent quality. This kind of positive effect increases as the firm's top management team quality increases. We also show that the positive effect of standards-setting involvements is more evident for state-owned enterprises than non-state-owned enterprises due to the unique features of state-owned enterprises. Our results are robust to a battery of tests, including the use of alternative model specifications, firm fixed effects, the instrumental variable approach, potential omitted variables, and propensity score matching procedure. Further analysis reveals that standards-setting involvements foster innovation mainly through improving firms' R&D efficiency, reducing financial constraints, and inducing collaborative innovation. Overall, our findings suggest that standards-setting involvements matter for corporate innovation in China.

Suggested Citation

  • Zhang, Mao & Wang, Yiming & Zhao, Qifeng, 2020. "Does participating in the standards-setting process promote innovation? Evidence from China," China Economic Review, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:chieco:v:63:y:2020:i:c:s1043951x20301292
    DOI: 10.1016/j.chieco.2020.101532
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    2. Zhao, Qifeng & Luo, Qianfeng & Tao, Yunqing, 2023. "From chaos to compliance: Standards-setting and financial fraud," Finance Research Letters, Elsevier, vol. 55(PA).
    3. He, Jiaxin & Li, Jingyi & Zhao, Daiqing & Chen, Xing, 2022. "Does oil price affect corporate innovation? Evidence from new energy vehicle enterprises in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 156(C).
    4. Tian Liang & Hongying Mao & Yujiao Tan & Bing Sun, 2023. "How Does Socio-technical Landscape Affect the Formation of Technical Standards?," SAGE Open, , vol. 13(4), pages 21582440231, December.
    5. Zhijie Zhang & Qingqing Zong, 2023. "Gender diversity and patent quality: Evidence from Chinese patent data," International Studies of Economics, John Wiley & Sons, vol. 18(4), pages 430-453, December.
    6. Kim, Dong-hyu, 2022. "Effects of catch-up and incumbent firms’ SEP strategic manoeuvres," Research Policy, Elsevier, vol. 51(5).
    7. Minhaz Farid Ahmed & Mazlin Bin Mokhtar & Chen Kim Lim & Anthony Wong Kim Hooi & Khai Ern Lee, 2021. "Leadership Roles for Sustainable Development: The Case of a Malaysian Green Hotel," Sustainability, MDPI, vol. 13(18), pages 1-26, September.
    8. Blind, Knut & Krieger, Bastian & Pellens, Maikel, 2022. "The interplay between product innovation, publishing, patenting and developing standards," Research Policy, Elsevier, vol. 51(7).
    9. Chengzhi Niu & Hong He & Yunfei Qi & Shoujie Wang, 2024. "Can Participation in the Green Standard-Setting Process Promote Green Innovation in Heavy-Pollution Firms? Evidence from China," Sustainability, MDPI, vol. 16(14), pages 1-29, July.
    10. Zhao, Qifeng & Luo, Qianfeng & Tao, Yunqing, 2023. "The power of paper: Scientific disclosure and firm innovation," Finance Research Letters, Elsevier, vol. 56(C).
    11. Knut Blind & Maximilian Laer, 2022. "Paving the path: drivers of standardization participation at ISO," The Journal of Technology Transfer, Springer, vol. 47(4), pages 1115-1134, August.

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