Supply chain finance and enterprise dual innovation: The perspective of breakthrough and incremental innovation

Yonghong Ma and Enjia Zhu

International Review of Financial Analysis, 2025, vol. 105, issue C

Abstract: This study examines the impact of supply chain finance (SCF) on enterprise innovation in China by developing a comprehensive SCF index and applying negative binomial regression to a dataset of Chinese listed firms spanning from 2010 to 2023. The findings indicate that higher levels of SCF significantly enhance innovation, with a particularly strong effect on incremental innovation compared to breakthrough innovation. The positive association between SCF and innovation is more prominent among state-owned enterprises, high-tech firms, and heavily polluting industries. Furthermore, the study reveals that enterprises with stronger environmental, social, and governance (ESG) competitive advantages experience a greater positive effect of SCF on innovation, especially incremental innovation. Notably, heightened investor attention amplifies the positive influence of SCF on incremental innovation but diminishes its effect on breakthrough innovation. This research advances the literature on supply chain finance and corporate innovation by investigating the moderating roles of ESG and investor attention, while also emphasizing variations in innovation outcomes based on ownership and industry characteristics.

Keywords: Supply chain finance; Breakthrough innovation; Incremental innovation; Dual innovation (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:105:y:2025:i:c:s1057521925005022

DOI: 10.1016/j.irfa.2025.104415

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