Does continuous innovation failure lead firm innovation to hesitate to press forward?: Evidence from Chinese-listed technology-intensive industries firms

Bing Sun, Yanfeng Zhang, Yifan Zhao, Hongying Mao, Min Kang and Tian Liang

Journal of Business Research, 2025, vol. 186, issue C

Abstract: Continuous innovation failure is a common phenomenon in the process of firm innovation. However, little is known about how continuous innovation failure affects firm innovation, and what factors moderate the relationship between them. Using the empirical data from China’s technology-intensive industries listed firms, we find that continuous innovation failure doesn’t lead firm innovation to hesitate to press forward but promotes firms to increase innovation. Managerial overconfidence strengthens the positive impact of continuous innovation failure on firm innovation. Interestingly, managerial power does not enhance but weakens the regulatory role of managerial overconfidence. Further analysis shows that continuous innovation failure will prompt firms to increase exploratory innovation and reduce exploitative innovation. Heterogeneity analysis finds that the promotion effect of continuous innovation failure on firm innovation will be enhanced in firms with higher financial redundancy, but will be weakened in firms with higher R&D subsidies.

Keywords: Continuous innovation failure; Firm innovation; Managerial overconfidence; Managerial power; Heterogeneity analysis (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:186:y:2025:i:c:s0148296324004909

DOI: 10.1016/j.jbusres.2024.114986

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