IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v67y2024ipas1544612324008651.html
   My bibliography  Save this article

Patent strategies in the digital revolution: How businesses use digital technology patents to optimize resource allocation efficiency

Author

Listed:
  • Lv, Xuejing
  • Zhao, Bosi
  • Cheng, Defang
  • Xia, Chenyang

Abstract

This study assesses how digital technology patents affect resource allocation efficiency in China's nonfinancial firms (2009–2021) using a benchmark regression model. It finds that both the quantity and quality of these patents significantly improve allocation efficiency, especially in highly digitalized sectors. The analysis suggests that patents enhance efficiency via better innovation but their impact varies across enterprise types. Recommendations are made based on these findings.

Suggested Citation

  • Lv, Xuejing & Zhao, Bosi & Cheng, Defang & Xia, Chenyang, 2024. "Patent strategies in the digital revolution: How businesses use digital technology patents to optimize resource allocation efficiency," Finance Research Letters, Elsevier, vol. 67(PA).
  • Handle: RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324008651
    DOI: 10.1016/j.frl.2024.105835
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612324008651
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.frl.2024.105835?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Xiaoying Li & Jinling Li & Xinjie Wu, 2020. "University Spillovers, Spatial Distance, and Firm Innovation: Evidence at Chinese Listed Firms," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 56(7), pages 1504-1519, May.
    2. Chen, Xinmin & Huang, Yuhong & Gao, Yajia, 2024. "Can urban low-carbon transitions promote enterprise digital transformation?," Finance Research Letters, Elsevier, vol. 59(C).
    3. Donghui Li & Yingdong Liu & Minxing Sun & Xinjie Wang & Weike Xu, 2023. "Does venture-backed innovation support carbon neutrality?," China Finance Review International, Emerald Group Publishing Limited, vol. 14(1), pages 191-200, March.
    4. Ye Wu & Haohui Li & Ruiyu Luo & Yubing Yu, 2023. "How digital transformation helps enterprises achieve high-quality development? Empirical evidence from Chinese listed companies," European Journal of Innovation Management, Emerald Group Publishing Limited, vol. 27(8), pages 2753-2779, April.
    5. Hirshleifer, David & Hsu, Po-Hsuan & Li, Dongmei, 2013. "Innovative efficiency and stock returns," Journal of Financial Economics, Elsevier, vol. 107(3), pages 632-654.
    6. Chang-Tai Hsieh & Peter J. Klenow, 2009. "Misallocation and Manufacturing TFP in China and India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(4), pages 1403-1448.
    7. Huang, Qiongyu & Xu, Chuhong & Xue, Xiaolong & Zhu, Hui, 2023. "Can digital innovation improve firm performance: Evidence from digital patents of Chinese listed firms," International Review of Financial Analysis, Elsevier, vol. 89(C).
    8. Qiang Lu & Yang Deng & Xinyi Wang & Aiping Wang, 2023. "The impact of China's green credit policy on enterprise digital innovation: evidence from heavily-polluting Chinese listed companies," China Finance Review International, Emerald Group Publishing Limited, vol. 14(1), pages 103-121, August.
    9. Fan, Yaoyao & Ly, Kim Cuong & Jiang, Yuxiang, 2023. "Institutional investor networks and firm innovation: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 89(C).
    10. Mark Doms & Eric J. Bartelsman, 2000. "Understanding Productivity: Lessons from Longitudinal Microdata," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 569-594, September.
    11. Zhang, Tianyu, 2022. "Independent directors and patenting strategies: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 81(C).
    12. Zhang, Tianyu, 2023. "Peer effects in R&D investment based on interlock network: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 89(C).
    13. Ungkyu Han & Mette Asmild & Martin Kunc, 2016. "Regional R&D Efficiency in Korea from Static and Dynamic Perspectives," Regional Studies, Taylor & Francis Journals, vol. 50(7), pages 1170-1184, July.
    14. Wei Chen & Hui Qu & Kuo Chi, 2021. "Partner Selection in China Interorganizational Patent Cooperation Network Based on Link Prediction Approaches," Sustainability, MDPI, vol. 13(2), pages 1-16, January.
    15. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-1297, November.
    16. Kong, Dongmin & Zhang, Bohui & Zhang, Jian, 2022. "Higher education and corporate innovation," Journal of Corporate Finance, Elsevier, vol. 72(C).
    17. Liu, Shanmin & Zhuo, Yangyuan & Shen, Xinyue & Cai, Mengda & Yang, Ye, 2023. "The impact of declined social insurance contribution rate on enterprise total factor productivity: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 87(C).
    18. Zheng, Panpan & Li, Zhen & Zhuang, Ziyin, 2023. "The impact of judicial protection of intellectual property on digital innovation: Evidence from China," Finance Research Letters, Elsevier, vol. 58(PA).
    19. Kai Lisa Lo & Jiaojiao Zhang & Fei Xia, 2023. "Does digital technology innovation work better for industrial upgrading? An empirical analysis of listed Chinese manufacturing firms," Applied Economics Letters, Taylor & Francis Journals, vol. 30(18), pages 2504-2509, October.
    20. Wang, Qiong & Qiu, Muqing & Tan, Wenhao, 2020. "Does insiders share pledging stifle innovation? Evidence from China," International Review of Financial Analysis, Elsevier, vol. 72(C).
    21. Muhammad Azhar Khalil & Rashid Khalil & Muhammad Khuram Khalil, 2022. "Environmental, social and governance (ESG) - augmented investments in innovation and firms' value: a fixed-effects panel regression of Asian economies," China Finance Review International, Emerald Group Publishing Limited, vol. 14(1), pages 76-102, October.
    22. Zhijun Feng & Bo Zeng & Qian Ming, 2018. "Environmental Regulation, Two-Way Foreign Direct Investment, and Green Innovation Efficiency in China’s Manufacturing Industry," IJERPH, MDPI, vol. 15(10), pages 1-22, October.
    23. JaeYeon Sim & Kyungmyung Jang, 2023. "Blockchain innovation and firm’s financial performance: patent analysis based on firm-level information," Applied Economics, Taylor & Francis Journals, vol. 55(60), pages 7178-7193, December.
    24. Wang, Lan, 2023. "Digital transformation and total factor productivity," Finance Research Letters, Elsevier, vol. 58(PA).
    25. Zhang, Dongyang & Jin, Yue, 2021. "R&D and environmentally induced innovation: Does financial constraint play a facilitating role?," International Review of Financial Analysis, Elsevier, vol. 78(C).
    26. Dongmin Kong & Chen Lin & Lai Wei & Jian Zhang, 2022. "Information Accessibility and Corporate Innovation," Management Science, INFORMS, vol. 68(11), pages 7837-7860, November.
    27. Park, Jinho & Choi, Byungchul & Huang, Wei, 2023. "Innovation under debtor-friendly institutional policy: Strategic patenting perspective of Chinese listed firms," International Review of Financial Analysis, Elsevier, vol. 89(C).
    28. Yang, Hao-Chang & Feng, Gen-Fu & Zhao, Xin Xin & Chang, Chun-Ping, 2022. "The impacts of energy insecurity on green innovation: A multi-country study," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 139-154.
    29. Taohong Wang & Zhe Song & Jing Zhou & Huaping Sun & Fengqin Liu, 2022. "Low-Carbon Transition and Green Innovation: Evidence from Pilot Cities in China," Sustainability, MDPI, vol. 14(12), pages 1-21, June.
    30. Yun Zhang & Xia Fang & Zhenyu Yang & Yuchen Sun & Qiuyu Wang, 2023. "Green Finance, Technological Innovation, and Energy Efficiency Improvements: Evidence from China’s Green Finance Reform Pilot Zone," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 59(11), pages 3531-3549, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Pengmian & Zhao, Tao, 2024. "Impact of population aging on corporate digital transformation strategies: An empirical investigation based on population census data from various provinces in China," Finance Research Letters, Elsevier, vol. 67(PA).
    2. De loecker, Jan & Asker, John & Collard-Wexler, Allan, 2011. "Productivity volatility and the misallocation of resources in developing economies," CEPR Discussion Papers 8469, C.E.P.R. Discussion Papers.
    3. Ezra Oberfield & Devesh Raval, 2021. "Micro Data and Macro Technology," Econometrica, Econometric Society, vol. 89(2), pages 703-732, March.
    4. Xiaobing, Huang & Xiaolian, Liu, 2015. "Exporting firm dynamics and productivity growth: Evidence from China," Economics Discussion Papers 2015-64, Kiel Institute for the World Economy (IfW Kiel).
    5. Daan Freeman & Leon Bettendorf & Harro van Heuvelen & Gerdien Meijerink, 2021. "The contribution of business dynamics to productivity growth in the Netherlands," CPB Discussion Paper 427, CPB Netherlands Bureau for Economic Policy Analysis.
    6. Brandt, Loren & Van Biesebroeck, Johannes & Zhang, Yifan, 2012. "Creative accounting or creative destruction? Firm-level productivity growth in Chinese manufacturing," Journal of Development Economics, Elsevier, vol. 97(2), pages 339-351.
    7. Thomas Grebel & Mauro Napoletano & Lionel Nesta, 2023. "Distant but Close in Sight: Firm‐level Evidence on French–German Productivity Gaps in Manufacturing," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(1), pages 228-261, March.
    8. Enghin Atalay, 2014. "Materials Prices And Productivity," Journal of the European Economic Association, European Economic Association, vol. 12(3), pages 575-611, June.
    9. Fontanelli, Luca & Guerini, Mattia & Napoletano, Mauro, 2023. "International trade and technological competition in markets with dynamic increasing returns," Journal of Economic Dynamics and Control, Elsevier, vol. 149(C).
    10. Alistair Dieppe, 2021. "Global Productivity," World Bank Publications - Books, The World Bank Group, number 34015.
    11. Marcela Eslava & Marcela Melendez, 2009. "Politics, Policies and the Dynamics of Aggregate Productivity in Colombia," Research Department Publications 4633, Inter-American Development Bank, Research Department.
    12. Eslava, Marcela & Haltiwanger, John C. & Kugler, Adriana & Kugler, Maurice, 2009. "Trade Reforms and Market Selection: Evidence from Manufacturing Plants in Colombia," IZA Discussion Papers 4256, Institute of Labor Economics (IZA).
    13. Chunhua Lu & Hong Li, 2023. "Have China’s Regional Carbon Emissions Trading Schemes Promoted Industrial Resource Allocation Efficiency? The Evidence from Heavily Polluted Industries at the Provincial Level," Sustainability, MDPI, vol. 15(3), pages 1-20, February.
    14. Van Reenen, John, 2011. "Does competition raise productivity through improving management quality?," International Journal of Industrial Organization, Elsevier, vol. 29(3), pages 306-316, May.
    15. Matthias Kehrig, 2011. "The Cyclicality of Productivity Dispersion," 2011 Meeting Papers 484, Society for Economic Dynamics.
    16. Bloom, Nicholas & Van Reenen, John, 2011. "Human Resource Management and Productivity," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 19, pages 1697-1767, Elsevier.
    17. Li, Xiao-Lin & Si, Deng-Kui, 2024. "Does financial market liberalization promote corporate radical innovation? Evidence from China," International Review of Financial Analysis, Elsevier, vol. 95(PB).
    18. Wang, Xuefeng & Liu, Haiyun, 2023. "FDI in services and firm innovation," Finance Research Letters, Elsevier, vol. 56(C).
    19. Fang, Mingyue, 2014. "先天优势还是后天努力?——国企级别对全要素生产率影响的实证研究 [Innate Advantages or Hard Work? An Empirical Study on the Impacts of SOEs’ Administrative Level on Total Factor Productivity]," MPRA Paper 60439, University Library of Munich, Germany.
    20. Talan B. Işcan, 2012. "Allocative Inefficiency and Sectoral Allocation of Labor: Evidence From US Structural Transformation," Working Papers daleconwp2012-02, Dalhousie University, Department of Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324008651. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.