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Bridging law and strategy: How intellectual property courts reshape corporate digital transformation through dynamic capabilities

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  • Xu, Liang
  • Luo, Yusen
  • Xu, Jing

Abstract

The global proliferation of specialized intellectual property courts constitutes a judicial experiment to stimulate innovation, yet its impact on corporate digital transformation (CDT)—a process necessitating rapid resource reconfiguration and strategic foresight—remains underexplored. Drawing upon institutional theory and the dynamic capabilities perspective and leveraging China's specialized IP court reforms from 2001 to 2022 and a panel dataset of 4321 A-share listed firms, our difference-in-differences analysis reveals three key findings: First, IP judicial protection significantly accelerates CDT in China, a conclusion robust to multiple identification checks. Second, we examine the role of judicial efficiency in the relationship between IP judicial protection and CDT. We find that higher average compensation for IP cases and shorter trial periods strengthen the positive effect of IP judicial protection on CDT, whereas a higher plaintiff loss rate at first instance weakens this effect. Third, we find that IP judicial protection promotes CDT through two channels: increasing firm resource endowments and reducing environmental uncertainty. Finally, this effect is concentrated among privately owned firms, technologically sophisticated firms, and firms in eastern regions. These findings provide actionable insights for policymakers to design intelligent IP ecosystems and for firms to align judicial reforms with digital transformation strategies.

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  • Xu, Liang & Luo, Yusen & Xu, Jing, 2026. "Bridging law and strategy: How intellectual property courts reshape corporate digital transformation through dynamic capabilities," Technovation, Elsevier, vol. 150(C).
    • Handle: RePEc:eee:techno:v:150:y:2026:i:c:s0166497225002196
    DOI: 10.1016/j.technovation.2025.103387
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