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Para-social interaction and firm innovation: Does consumer attachment to brand ambassadors stimulate risky R&D investments?

Author

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  • Kong, Jing
  • You, Jing

Abstract

How para-social interaction affects firm behavior, especially innovation, is little investigated and theoretically controversial. To close the gap, this article utilizes Chinese data and finds that consumer attachment to brand ambassadors greatly enhances firms’ risky R&D intensity. Moreover, this impact is stronger for firms with lower credit ratings and higher borrowing costs. Finally, we document that stable revenue is a prominent underlying economic mechanism. Our conclusions hold under a variety of econometric checks. Overall, this article, by showing a novel association between para-social interaction and innovation, enriches the current research at the intersection of finance and social psychology.

Suggested Citation

  • Kong, Jing & You, Jing, 2026. "Para-social interaction and firm innovation: Does consumer attachment to brand ambassadors stimulate risky R&D investments?," Finance Research Letters, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:finlet:v:88:y:2026:i:c:s1544612325023396
    DOI: 10.1016/j.frl.2025.109090
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    References listed on IDEAS

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