Capital Market Opening and Firm Innovation:From the Perspective of Corporate Governance
Based on the natural experiment provided by the Shanghai-Hongkong Stock Connect and Shenzhen-Hongkong Stock Connect(HSSC),this paper uses a multi-period difference-in-difference model to study the impact of the capital market opening on enter-prise innovation.It also discusses the impact mechanism from the perspective of corporate governance.The results show that the HSSC can significantly improve enterprises'innovation input,innovation output,and innovation efficiency.In this process,the corporate governance mechanism plays an important role.From the perspective of incentive channels,the HSSC can improve the equity incentive and compensation incentive for executives,enhance the innovation ability of the executive team,and increase the government subsidies that enterprises can obtain,fully mobilizing the enthusiasm of enterprises to carry out innovative activities.From the perspective of supervision channels,the HSSC can strengthen the supervision over the equity pledge behavior of control-ling shareholders and the agency behavior of managers.At the same time,it can attract more attention from analysts and inves-tors,improving the internal governance environment for enterprise innovation through external supervision.Heterogeneity analysis shows that the HSSC can more significantly improve the innovation level of non-state-owned enterprises,non-high-tech enterpri-ses,and enterprises in poor legal environments.Furthermore,after the implementation of the policy,the"high-quality"innova-tion output of enterprises has increased significantly,and the total factor productivity has also increased significantly.