RESEARCH ARTICLE
Creditor litigation and corporate innovation: Evidence from China
Jin Lu,
Yaling Li,
Wenxiao Zou,
Corresponding Author
Jin Lu
School of Finance, Southwestern University of Finance and Economics, Wenjiang District, Chengdu, Sichuan, China
Correspondence
Jin Lu, School of Finance, Southwestern University of Finance and Economics, No. 555, Liutai Avenue, Wenjiang District, Chengdu, Sichuan, China.
Email: [email protected]
Search for more papers by this authorYaling Li
School of Finance, Southwestern University of Finance and Economics, Wenjiang District, Chengdu, Sichuan, China
Search for more papers by this authorWenxiao Zou
School of Sociology, University of Bristol, Bristol, UK
Search for more papers by this authorJin Lu,
Yaling Li,
Wenxiao Zou,
Corresponding Author
Jin Lu
School of Finance, Southwestern University of Finance and Economics, Wenjiang District, Chengdu, Sichuan, China
Correspondence
Jin Lu, School of Finance, Southwestern University of Finance and Economics, No. 555, Liutai Avenue, Wenjiang District, Chengdu, Sichuan, China.
Email: [email protected]
Search for more papers by this authorYaling Li
School of Finance, Southwestern University of Finance and Economics, Wenjiang District, Chengdu, Sichuan, China
Search for more papers by this authorWenxiao Zou
School of Sociology, University of Bristol, Bristol, UK
Search for more papers by this authorFirst published: 12 November 2024
Abstract
Using data from 2007 to 2021 for Chinese listed companies, this study investigates the impact of creditor litigation on corporate innovation. It finds that companies involved in creditor litigation tend to reduce innovative patent applications. This finding persists across various tests and endogeneity analyses. Further investigation uncovers that this impact is particularly pronounced in firms with high-performance sensitivity, while it diminishes in firms with equity incentives. The mechanism analysis reveals the external pressures caused by creditor litigation, which leads to an escalation in a firm's operational expenses and compels a decrease in R&D investments, consequently constraining innovation.
Open Research
DATA AVAILABILITY STATEMENT
The authors do not have permission to share data.
Supporting Information
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| acfi13364-sup-0001-AppendixS1-S2.docxWord 2007 document , 18.4 KB |
Appendix S1. |
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