Financing Constraints, Other People’s Money Strategy, and Enterprise Innovation

Wenxian Hu, Qi Shi and Jinlong Chen

Asia-Pacific Journal of Accounting & Economics, 2025, vol. 32, issue 1, 91-109

Abstract: Innovation is the driving force of social and economic development, and there is a certain consensus that financing constraints inhibit enterprise innovation. However, the role of Other People’s Money strategy in the link between financing constraints and enterprise innovation is largely ignored. Using the sample of A-share non-financial listed companies from 2008 to 2017, this study first examines the relationship between financing constraints and enterprise innovation and then investigates the role of Other People’s Money strategy in this link. In addition, we explore how the impact of Other People’s Money strategy varies with firm type (state-owned enterprise [SOE] vs. non-SOE) and with the level of regional financial marketization. We find that (1) financing constraints inhibit enterprise innovation, (2) Other People’s Money strategy can mitigate the negative effect of financing constraints on enterprise innovation, and (3) the mitigation role of Other People’s Money strategy is more significant in non-SOEs and in areas with low financial marketization level. The findings of this paper shed new light on the literature of financing constraints, innovation, and Other People’s Money strategy.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/16081625.2023.2222135 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:raaexx:v:32:y:2025:i:1:p:91-109

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/raae20

DOI: 10.1080/16081625.2023.2222135

Access Statistics for this article

Asia-Pacific Journal of Accounting & Economics is currently edited by Yin-Wong Cheung, Hong Hwang, Jeong-Bon Kim, Shu-Hsing Li and Suresh Radhakrishnan

More articles in Asia-Pacific Journal of Accounting & Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().