The puzzle of household wealth preservation and corporate innovation

Jiaxin Wang, Jiemei Liu, Jiawei Wang, Xiang Huang and Yu Liu

International Review of Financial Analysis, 2023, vol. 90, issue C

Abstract: This paper uses the price changes in China's real estate market during the 2008 financial crisis as an identification strategy to test the impact of household wealth preservation (HWP) on corporate innovation. We find that HWP can significantly promote firm innovation, especially green technology innovation. Replacing physical capital-driven innovation with human capital-driven innovation is proven to be an important channel. Further, we find that the innovations brought by the HWP have a positive impact on the firm's future value. Our findings provide micro empirical evidence for the relationship between capital and talent in the enterprise innovation process and propose a novel strategy for fostering enterprise innovation.

Keywords: Household wealth preservation (HWP); Corporate innovation; Financing dependence; Human capital (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:90:y:2023:i:c:s105752192300409x

DOI: 10.1016/j.irfa.2023.102893

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