IDEAS home Printed from https://ideas.repec.org/a/taf/apeclt/v30y2023i4p456-461.html
   My bibliography  Save this article

Zombie firms and corporate innovation: a double distortion effect—empirical evidence from China

Author

Listed:
  • Xiaolin Yu
  • Fan Wu
  • Kai Wan
  • Tsangyao Chang

Abstract

With China’s entering into the era of high-quality development, we have studied in this paper whether and how the so-called ‘zombie firms’ have inhibitory impact on the quantity and quality of corporate innovation in normal enterprises. Using the 1998–2013 Chinese industrial database as the empirical evidence, we find that the inhibitory impact is significant, and particularly imminent for those normal enterprises with high innovation intensity under further inspection of heterogeneity test. Impact mechanism test indicates two major channels through which the inhibitory impact manifests: competition distortion and financing constraints. Our study not only clarifies the impact of zombie firms on the quantity and quality of corporate innovation, but also provides both theoretical and empirical reference for policymakers in China to properly address the problems of zombie firms and promote high-quality corporate innovation.

Suggested Citation

  • Xiaolin Yu & Fan Wu & Kai Wan & Tsangyao Chang, 2023. "Zombie firms and corporate innovation: a double distortion effect—empirical evidence from China," Applied Economics Letters, Taylor & Francis Journals, vol. 30(4), pages 456-461, February.
    • Handle: RePEc:taf:apeclt:v:30:y:2023:i:4:p:456-461
    DOI: 10.1080/13504851.2021.1991563
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/13504851.2021.1991563
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/13504851.2021.1991563?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.

    More about this item

    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:taf:apeclt:v:30:y:2023:i:4:p:456-461. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEL20 .

    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.