IDEAS home Printed from https://ideas.repec.org/a/eee/techno/v154y2026ics0166497226000969.html

The “double-edged sword” effect of generative AI applications on corporate innovation

Author

Listed:
  • Zhang, Xiaobin
  • Yang, Mengxi
  • Hu, Yimei
  • Wang, Yongwei
  • Wu, Weijie

Abstract

This study examines the mechanism and boundary conditions of how generative AI (GEN-AI) affects ambidextrous innovation – both catch-up and leading-edge – in Chinese manufacturing firms. Based on empirical analysis of 218 Chinese manufacturing enterprises, we find that: GEN-AI adoption significantly enhances reverse engineering capabilities by enabling rapid deconstruction of technical parameters and design logic of leading products, accelerating catch-up innovation. However, GEN-AI application may induce “innovation inertia,” hindering originality and pioneering innovation. Furthermore, dysfunctional competition and entrepreneurial orientation serve as critical external and internal moderators, shaping GEN-AI's innovation impact. The study proposes a “Technology application-Knowledge reconstruction-Innovation pathway” framework, revealing the double-edged sword effect of GEN-AI adoption on corporate innovation. The findings provide strategic insights for latecomer firms to balance imitation and indigenous innovation and inform policy makers seeking to refine digital innovation governance.

Suggested Citation

  • Zhang, Xiaobin & Yang, Mengxi & Hu, Yimei & Wang, Yongwei & Wu, Weijie, 2026. "The “double-edged sword” effect of generative AI applications on corporate innovation," Technovation, Elsevier, vol. 154(C).
    • Handle: RePEc:eee:techno:v:154:y:2026:i:c:s0166497226000969
    DOI: 10.1016/j.technovation.2026.103561
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0166497226000969
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.technovation.2026.103561?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

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    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:techno:v:154:y:2026:i:c:s0166497226000969. 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.sciencedirect.com/science/journal/01664972 .

    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.