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The impact of relaxing technology export regulations on corporate innovation

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  • Li, Haoyang
  • Yang, Mingjing
  • Sun, Yanqi
  • Chen, Jingwei

Abstract

By leveraging China's 2008 revision of the “Catalogue of Technologies Prohibited and Restricted from Export” as an exogenous shock, we conduct difference-in-difference regressions to examine the impact of relaxing technology export restrictions (TERs) on corporate innovation. The results show that relaxing TERs increases the number of innovative patent applications of a specific firm by increasing its R&D investment. Additional tests suggest that relaxing TERs raises outbound direct investments (ODI). Overall, relaxing TERs motivates firms to allocate more resources to innovation projects. Hence, the innovation outcomes and innovation quality of the firm significantly increase after technologies are removed from TERs.

Suggested Citation

  • Li, Haoyang & Yang, Mingjing & Sun, Yanqi & Chen, Jingwei, 2022. "The impact of relaxing technology export regulations on corporate innovation," Finance Research Letters, Elsevier, vol. 50(C).
    • Handle: RePEc:eee:finlet:v:50:y:2022:i:c:s1544612322004524
    DOI: 10.1016/j.frl.2022.103256
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    Cited by:

    1. Tan, Zhuohong & Wang, Handi & Hong, Yunzhe, 2023. "Does bank FinTech improve corporate innovation?," Finance Research Letters, Elsevier, vol. 55(PA).

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    More about this item

    Keywords

    Technology export regulation; Innovation; R&D investments;
    All these keywords.

    JEL classification:

    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
    • N75 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Asia including Middle East
    • N45 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Asia including Middle East

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