Online Incentives,Market Segmentation and Firm Innovation
Amid efforts to establish a new development framework,the integration of market resources across regions,facilitation of domestic market circulation,and leveraging of mega-market scale to drive corporate innovation are vital for China's high-quality economic growth.Despite China's global leadership in e-commerce and its expanded role in the industrial sector,the rapid growth of the domestic online market has yet to significantly elevate the country's innovation inputs.Existing literature provides limited insights into this phenomenon,particularly from the perspective of market segmentation.This study develops a model,grounded in the heterogeneous enterprise framework,that examines online and offline sales within a segmented,closed economy.Utilizing data from the World Bank's 2012 China Enterprise Survey and online sales data of publicly listed companies from the Wind database(2015-2022),it investigates the impact of online sales on enterprise innovation behaviors,highlighting the influence of market segmentation and its mechanisms.The findings reveal an"inverted U-shaped"relationship between market segmentation and innovation investment,shaped by the"local market lock-in effect"and the"market shrinkage effect."Online sales exhibit a"market expansion effect"that initially spurs firms to increase innovation investment.However,as market segmentation intensifies,the overlap between online and offline markets grows,leading to a"market substitution effect"that gradually dampens the positive impact of online sales on innovation investment.Further analysis identifies that industry characteristics,such as factor intensity and firm size,contribute to the heterogeneous effects of online sales on firm innovation.This paper advances the literature in three main areas:first,by integrating online sales,market segmentation,and firm innovation within a heterogeneous firm model,it provides a comprehensive explanation for the limited role of online sales in fostering innovation investment,expanding theoretical perspectives on innovation incentives through online platforms.Second,it captures the non-linear impact of market segmentation on innovation investment within a"demand-driven innovation"framework,offering a theoretical foundation to support market integration and guide innovation policy formulation.Third,by employing two sets of microdata,this study provides rigorous empirical evidence of the direction and mechanisms through which online sales influence innovation investment,enhancing understanding of the interplay between online sales,market segmentation,and innovation investment.The findings underscore the unexploited potential of online incentives,offering valuable insights for policymakers.By formulating targeted policies for online platform development and supporting diverse enterprise needs within a unified national market,government agencies can promote market integration and more effectively harness the innovative potential of online sales.
万方数据
维普
