IDEAS home Printed from https://ideas.repec.org/a/eee/pacfin/v86y2024ics0927538x24001860.html
   My bibliography  Save this article

Common institutional ownership types and corporate innovation: A taxonomy based on whether the investees are in the same industry

Author

Listed:
  • Tang, Xudong
  • Jia, Yang
  • Li, Rui

Abstract

Using data from 2008 to 2022 for Chinese A-share listed firms, this paper explores the impact of common institutional ownership on firm innovation. Theoretically, common institutional ownership may increase the tendency of collusion among firms through “monopoly mechanism” to avoid fierce competition, but provide firms with information and resources through “governance mechanism” to play a synergistic role. To this end, we construct two metrics: same-industry common institutional ownership and cross-industry common institutional ownership, which allow us to capture both of these mechanisms separately. The empirical results show that same-industry common institutional ownership inhibits firm innovation, while cross-industry common institutional ownership increases firm innovation, supporting the corresponding theoretical predictions respectively. Further, the cross-sectional test suggests that state-owned inhibits firm innovation more than non-state-owned same-industry common institutional ownership, while non-state-owned promotes firm innovation more than state-owned cross-industry common institutional ownership.

Suggested Citation

  • Tang, Xudong & Jia, Yang & Li, Rui, 2024. "Common institutional ownership types and corporate innovation: A taxonomy based on whether the investees are in the same industry," Pacific-Basin Finance Journal, Elsevier, vol. 86(C).
  • Handle: RePEc:eee:pacfin:v:86:y:2024:i:c:s0927538x24001860
    DOI: 10.1016/j.pacfin.2024.102435
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0927538X24001860
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.pacfin.2024.102435?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:pacfin:v:86:y:2024:i:c:s0927538x24001860. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/pacfin .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.