Open Access Journal Article

How does financial development environment affect regional innovation capabilities? New perspectives from digital finance and institutional quality

by Feiling Lu a,*
a
College of Letters & Science-Economics Dept, University of Wisconsin-Madison, Madison, USA
*
Author to whom correspondence should be addressed.
JIE  2023, 3; 1(1), 3; https://doi.org/10.58567/jie01010003
Received: 10 December 2022 / Accepted: 13 January 2023 / Published Online: 16 January 2023
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Abstract

Based on China's 30 provincial panel data from 2006 to 2018, this paper uses the spatial Durbin model to empirically study the influence path and transmission mechanism of financial development on regional technological innovation, and introduce digital finance environment, marketization degree, and government environmental management as an adjustment variable to verify its regulating effect on financial development and regional technological innovation. The study found that the overall promotion of digital finance to local technological innovation is not significant. Besides, the characteristics of ownership discrimination and weak risk appetite in the bank's medium and long-term credit market have led to its failure to promote regional technological innovation. In contrast, the stock market and bond market in direct financing channels have enhanced local innovation capabilities. When the external environmental system is used as the adjustment variable, the results show that an excellent digital finance development, marketization degree, and government environmental management can effectively and positively regulate the effect of financial development and technological innovation.

Keywords: Institutional quality; R&D input; Regional innovation ability; Threshold effect;
Copyright: © 2023 by Lu. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) (Creative Commons Attribution 4.0 International License). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
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ACS Style
Lu, F. How does financial development environment affect regional innovation capabilities? New perspectives from digital finance and institutional quality. Journal of Information Economics, 2023, 1, 3. https://doi.org/10.58567/jie01010003
AMA Style
Lu F. How does financial development environment affect regional innovation capabilities? New perspectives from digital finance and institutional quality. Journal of Information Economics; 2023, 1(1):3. https://doi.org/10.58567/jie01010003
Chicago/Turabian Style
Lu, Feiling 2023. "How does financial development environment affect regional innovation capabilities? New perspectives from digital finance and institutional quality" Journal of Information Economics 1, no.1:3. https://doi.org/10.58567/jie01010003
APA style
Lu, F. (2023). How does financial development environment affect regional innovation capabilities? New perspectives from digital finance and institutional quality. Journal of Information Economics, 1(1), 3. https://doi.org/10.58567/jie01010003

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