How does domestic market fragmentation affect enterprise innovation performance? Empirical evidence from China
International Journal of Emerging Markets
ISSN: 1746-8809
Article publication date: 11 August 2022
Issue publication date: 19 March 2024
Abstract
Purpose
This paper aims to explore the impact of domestic market fragmentation on the innovation performance of enterprises and its mechanism from the perspective of market segmentation, a government behavior with Chinese characteristics.
Design/methodology/approach
In order to verify the theoretical hypothesis proposed in the previous article, that is, whether domestic market fragmentation can effectively improve the innovation performance of enterprises, this paper bases on the data of listed companies from 2010 to 2016, empirically testing the theoretical hypothesis by constructing a measurement model.
Findings
Domestic market fragmentation has a significant inhibitory effect on enterprise innovation performance. Domestic market fragmentation has heterogeneous effects on innovation performance of enterprises and regions. It is undeniable that domestic market fragmentation does have a certain support effect on state-owned enterprises but the support effect is achieved by distorting regional resource allocation and creating an unfair market environment.
Originality/value
Firstly, this paper explores the impact mechanism of domestic market fragmentation on corporate innovation performance from the perspective of market segmentation, a government behavior with Chinese characteristics, so as to expand and enrich the relevant research on enterprise innovation. Secondly, from the perspective of corporate innovation performance, this paper provides new evidence for the “curse effect” of domestic market fragmentation. Thirdly, this paper tries to shake the domestic market fragmentation support theory from the perspective of distortion effect brought by the “hand of support” of domestic market fragmentation.
Keywords
Citation
Qi, X.-F. and Zhou, L. (2024), "How does domestic market fragmentation affect enterprise innovation performance? Empirical evidence from China", International Journal of Emerging Markets, Vol. 19 No. 4, pp. 1007-1025. https://doi.org/10.1108/IJOEM-11-2019-0945
Publisher
:Emerald Publishing Limited
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