Digital infrastructure and cross-regional collaborative innovation in enterprises

Xiaohan Tian and Haiyong Lu

Finance Research Letters, 2023, vol. 58, issue PC

Abstract: This article delves into the role that digital infrastructure plays in facilitating cross-regional collaboration in the innovation processes of enterprises. Collaborative innovation has emerged as a crucial mode of innovation for businesses engaged in technological R&D as the complexity of such R&D grows more sophisticated. In this study, we leveraged the recent nation-wide rollout of China's “Broadband China” strategic pilot program as a natural experiment to empirically investigate the impact of digital infrastructure on cross-regional collaboration in innovation. Our analysis of the financial data of Chinese A-share listed companies from 2008 to 2019 reveals that investments in digital infrastructure have a major impact on encouraging cross-regional collaborative innovation within businesses. Through the study, we examined the mechanisms through which digital infrastructure promotes cross-regional collaboration in innovation and found that the reduction in transaction costs serves as the key rationale for this phenomenon. Moreover, a heterogeneous analysis revealed that businesses with higher levels of technological R&D, industries characterized by rapid technological transformation, and cities with elevated levels of human capital are more likely to benefit from digital infrastructure investments that foster cross-regional collaborative innovation.

Keywords: Broadband China; Digital infrastructure; Enterprise remote collaboration innovation; Listed companies (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:58:y:2023:i:pc:s1544612323010073

DOI: 10.1016/j.frl.2023.104635

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