Intellectual property judicial protection, innovation factor input, and corporate innovation: Evidence from the establishment of intellectual property courts in China

Abstract

Based on the establishment of China's intellectual property (IP) courts, this article examines the impact of intellectual property judicial protection (IPJP) on corporate innovation using the sample of China's A‐shared listed firms from 2013 to 2021 by the time‐varying difference‐in‐differences (DID) model. The result shows that IP courts have a significant positive effect on corporate innovation, mainly by increasing innovation factor input, including expenditure of R&D funds and R&D personnel quantity. Additionally, the effect is stronger for invention patents and in non‐state‐owned firms, small firms, high‐tech firms, and firms with low financing constraints.