Innovation, Mark-Up and Firm Growth: Evidence from China’s New Generation IT Industry
Abstract
:1. Introduction
2. Related Literature
3. Econometric Models, Variables and Data
3.1. Model Specification
+ β6lnSizeit-1 × lnAgeit-1 + β7lnKLit + β8D_Ex + ωf + ηg + ξh + μi + νt + εit
+ β6lnSizeit-1 × lnAgeit-1 + β7lnKLit + β8D_Ex + ωf + ηg + ξh + μi + νt + εit
3.2. Variables
+ ψLMlnLit × lnMit + ψKMlnKit × lnMit + ψLKM lnLit × lnKit × lnMi + ωit + νit
3.3. Data
4. Empirical Results and Their Analysis
4.1. Basic Model Estimation and Analysis
4.2. Robustness Checks
4.2.1. Estimation with Substitution Variables
4.2.2. Treatment of Endogeneity Problems: IV-2SLS Estimation
4.3. Test of the Relationship between Innovation and Firm’s Mark-Up
+ ϒ6lnSizeit-1 × lnAgeit-1 + ϒ7lnKLit + ϒ8D_Ex + ωf + ηg + ξh + μi + νt + εit
5. Conclusions and Policy Recommendations
Author Contributions
Funding
Acknowledgments
Conflicts of Interest
References
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Variable | Observations | Mean | Standard Deviation | Minimum | Maximum |
---|---|---|---|---|---|
lnEmprateit | 19,870 | 0.047 | 0.400 | −5.161 | 5.364 |
lnTtastrateit | 19,870 | 0.110 | 0.390 | −5.075 | 4.240 |
lnRevenuerateit | 18,535 | 0.187 | 0.514 | −4.309 | 9.236 |
lnEmpit-1 | 19,870 | 5.448 | 1.105 | 3.401 | 10.482 |
lnTtastit-1 | 18,535 | 10.600 | 1.513 | 7.076 | 17.754 |
lnRevenueit-1 | 18,535 | 10.804 | 1.448 | 8.500 | 18.102 |
lnAgeit-1 | 18,535 | 1.960 | 0.759 | 0.000 | 7.601 |
lnTfpit | 33,255 | 6.608 | 0.359 | 2.364 | 15.772 |
lnYLit | 33,284 | 2.516 | 15.339 | −526.263 | 997.090 |
lnMarkupit | 32,591 | 0.057 | 0.272 | −0.736 | 1.384 |
ROAit | 33,284 | 5.069 | 13.924 | −196.083 | 441.035 |
lnKLit | 33,284 | 3.548 | 1.248 | −6.778 | 8.990 |
Estimation Equation | (1) | (2) | (3) | (4) | (5) | (6) |
---|---|---|---|---|---|---|
Explained Variable | lnEmprateit | lnTtastrateit | lnRevenuerateit | lnEmprateit | lnTtastrateit | lnRevenuerateit |
lnTfpit | −0.072 *** | 0.015 | 0.542 *** | |||
(-6.832) | (1.417) | (40.318) | ||||
lnMarkupit | −0.122 *** | 0.092 *** | 0.701 *** | |||
(−8.470) | (6.166) | (39.266) | ||||
lnEmpit-1 | −0.977 *** | −0.997 *** | ||||
(−22.995) | (−23.291) | |||||
lnEmp2it-1 | 0.021 *** | 0.023 *** | ||||
(5.537) | (5.984) | |||||
lnAgeit-1 | −0.053 | −0.106 ** | −0.307 *** | −0.050 | −0.081 | −0.272 *** |
(−1.422) | (−2.041) | (−4.904) | (−1.337) | (−1.558) | (−4.423) | |
lnAge2it-1 | −0.017 *** | −0.007 | 0.003 | −0.017 *** | −0.008 | 0.005 |
(−3.305) | (−1.260) | (0.492) | (−3.227) | (−1.406) | (0.720) | |
lnEmpit-1 × lnAgeit-1 | 0.029 *** | 0.028 *** | ||||
(4.529) | (4.325) | |||||
lnTtastit-1 | −0.911 *** | −0.903 *** | ||||
(−16.095) | (−15.928) | |||||
lnTtast2it-1 | 0.012 *** | 0.012 *** | ||||
(4.555) | (4.454) | |||||
lnTtastit-1 × lnAgeit-1 | 0.016 *** | 0.014 *** | ||||
(3.230) | (2.807) | |||||
lnRevenueit-1 | −0.811 *** | −0.770 *** | ||||
(−14.783) | (−14.381) | |||||
lnRevenue2it-1 | 0.006 ** | 0.005 * | ||||
(2.374) | (1.873) | |||||
lnRevenueit-1 × lnAgeit-1 | 0.029 *** | 0.024 *** | ||||
(4.729) | (4.075) | |||||
lnKLit | −0.261 *** | 0.099 *** | −0.009 | −0.264 *** | 0.101 *** | −0.005 |
(−49.384) | (18.099) | (−1.401) | (−49.119) | (18.166) | (−0.681) | |
D_Ex | 0.107 *** | 0.080 *** | 0.081 *** | 0.105 *** | 0.080 *** | 0.086 *** |
(9.683) | (7.039) | (5.749) | (9.519) | (7.047) | (6.273) | |
Ownership effects | Yes | Yes | Yes | Yes | Yes | Yes |
Industry effects | Yes | Yes | Yes | Yes | Yes | Yes |
Regional effects | Yes | Yes | Yes | Yes | Yes | Yes |
Individual effects | Yes | Yes | Yes | Yes | Yes | Yes |
Year effects | Yes | Yes | Yes | Yes | Yes | Yes |
Obs | 15902 | 15902 | 15902 | 15563 | 15563 | 15563 |
R2 | 0.630 | 0.564 | 0.627 | 0.632 | 0.569 | 0.633 |
ESize | −0.691 | −0.625 | −0.625 | −0.691 | −0.621 | −0.615 |
EAge | 0.038 | 0.036 | 0.018 | 0.036 | 0.036 | 0.007 |
Estimation Equation | (1) | (2) | (3) | (4) | (5) | (6) |
---|---|---|---|---|---|---|
Explained Variable | lnEmprateit | lnTtastrateit | lnRevenuerateit | lnEmprateit | lnTtastrateit | lnRevenuerateit |
lnYLit | −0.090 *** | 0.036 *** | 0.234 *** | |||
(−20.000) | (7.802) | (40.091) | ||||
ROAit | 0.000 | −0.001 *** | 0.008 *** | |||
(0.245) | (−3.479) | (20.427) | ||||
control variables | Yes | Yes | Yes | Yes | Yes | Yes |
Ownership effects | Yes | Yes | Yes | Yes | Yes | Yes |
Industry effects | Yes | Yes | Yes | Yes | Yes | Yes |
Regional effects | Yes | Yes | Yes | Yes | Yes | Yes |
Individual effects | Yes | Yes | Yes | Yes | Yes | Yes |
Year effects | Yes | Yes | Yes | Yes | Yes | Yes |
Obs | 15912 | 15912 | 15912 | 15912 | 15912 | 15912 |
R2 | 0.637 | 0.565 | 0.624 | 0.624 | 0.563 | 0.585 |
Estimation Equation | (1) | (2) | (3) | (4) | (5) | (6) |
---|---|---|---|---|---|---|
Explained Variable | lnEmprateit | lnTtastrateit | lnRevenuerateit | lnEmprateit | lnTtastrateit | lnRevenuerateit |
lnTfpit | −0.046 | 0.200 | 1.721 *** | |||
(−0.324) | (1.630) | (9.351) | ||||
lnMarkupit | −0.479 *** | −0.013 | 1.967 *** | |||
(−2.711) | (−0.073) | (9.852) | ||||
control variables | Yes | Yes | Yes | Yes | Yes | Yes |
Ownership effects | Yes | Yes | Yes | Yes | Yes | Yes |
Industry effects | Yes | Yes | Yes | Yes | Yes | Yes |
Regional effects | Yes | Yes | Yes | Yes | Yes | Yes |
Individual effects | Yes | Yes | Yes | Yes | Yes | Yes |
Year effects | Yes | Yes | Yes | Yes | Yes | Yes |
Anderson canon. corr. LM statistic [Pvalue] | 85.459 [0.0000] | 138.595 [0.0000] | 154.914 [0.0000] | 110.813 [0.0000] | 111.701 [0.0000] | 184.211 [0.0000] |
Cragg-Donald Wald F statistic | 29.916 | 46.672 | 52.265 | 38.758 | 39.071 | 64.742 |
Sargan statistic [Pvalue] | 2.481 [0.1152] | 0.774 [0.3789] | 2.239 [0.1345] | 4.986 [0.0256] | 0.103 [0.7485] | 2.590 [0.1075] |
Obs | 15891 | 8924 | 8924 | 15314 | 15314 | 15314 |
R2 | 0.626 | 0.577 | 0.363 | 0.612 | 0.569 | 0.451 |
Hauman test [Pvalue] | [0.0000] | [0.0000] | [0.0000] | [0.0000] | [0.0000] | [0.0000] |
Estimation Equation | (1) | (2) | (3) | (4) | (5) | (6) |
---|---|---|---|---|---|---|
Estimation Method | OLS | IV—2SLS | OLS | IV—2SLS | OLS | IV—2SLS |
lnTfpit | 0.942 *** | 1.627 *** | 0.943 *** | 1.603 *** | 0.945 *** | 1.301 *** |
(341.684) | (8.230) | (343.690) | (8.503) | (348.208) | (18.815) | |
lnEmpit-1 | −0.030 *** | −0.052 ** | ||||
(−3.628) | (−2.294) | |||||
lnEmp2it-1 | 0.002 *** | 0.004 ** | ||||
(2.852) | (2.119) | |||||
lnAgeit-1 | −0.010 | 0.025 | −0.020 ** | −0.042 * | 0.008 | 0.033 ** |
(−1.385) | (1.177) | (−2.005) | (−1.664) | (0.818) | (2.081) | |
lnAge2it-1 | −0.001 | −0.003 | −0.001 | −0.004 | 0.000 | −0.002 |
(−0.756) | (−0.955) | (−0.677) | (−1.520) | (0.156) | (−0.974) | |
lnEmpit-1 × lnAgeit-1 | 0.003 ** | 0.001 | ||||
(2.563) | (0.182) | |||||
lnTtastit-1 | −0.087 *** | −0.136 *** | ||||
(−8.200) | (−4.494) | |||||
lnTtast2it-1 | 0.004 *** | 0.006 *** | ||||
(8.314) | (4.437) | |||||
lnTtastit-1 × lnAgeit-1 | 0.002 *** | 0.007 *** | ||||
(2.605) | (2.597) | |||||
lnRevenueit-1 | −0.152 *** | −0.233 *** | ||||
(−18.356) | (−11.453) | |||||
lnRevenue2it-1 | 0.007 *** | 0.011 *** | ||||
(18.612) | (11.770) | |||||
lnRevenueit-1 × lnAgeit-1 | −0.000 | −0.001 | ||||
(−0.358) | (−0.908) | |||||
lnKLit | −0.001 | 0.006 * | −0.001 | 0.005 | −0.001 | 0.003 |
(−0.693) | (1.878) | (−1.410) | (1.563) | (−0.969) | (1.557) | |
D_Ex | −0.006 *** | −0.010 * | −0.006 *** | −0.012 ** | −0.006 *** | −0.008 ** |
(−2.632) | (−1.797) | (−3.023) | (−2.077) | (−2.752) | (−2.260) | |
Ownership effects | Yes | Yes | Yes | Yes | Yes | Yes |
Industry effects | Yes | Yes | Yes | Yes | Yes | Yes |
Regional effects | Yes | Yes | Yes | Yes | Yes | Yes |
Individual effects | Yes | Yes | Yes | Yes | Yes | Yes |
Year effects | Yes | Yes | Yes | Yes | Yes | Yes |
Andersoncanon. corr. LM statistic [Pvalue] | 20.292 [0.0000] | 20.917 [0.0000] | 62.096 [0.0000] | |||
Cragg-Donald Wald F statistic | 7.066 | 7.284 | 21.681 | |||
Sargan statistic [Pvalue] | 0.007 [0.9335] | 0.020 [0.8888] | 0.118 [0.7307] | |||
Obs | 15563 | 15554 | 15563 | 15554 | 15563 | 15554 |
R2 | 0.970 | 0.801 | 0.971 | 0.814 | 0.971 | 0.926 |
Hauman test [Pvalue] | [0.0000] | [0.0000] | [0.0000] | |||
ESize | −0.002 | −0.006 | 0.002 | 0.005 | −0.001 | 0.003 |
EAge | 0.002 | 0.019 | −0.003 | 0.017 | 0.008 | 0.014 |
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Li, H.; Jin, L.; Ding, Y. Innovation, Mark-Up and Firm Growth: Evidence from China’s New Generation IT Industry. Sustainability 2019, 11, 2000. https://doi.org/10.3390/su11072000
Li H, Jin L, Ding Y. Innovation, Mark-Up and Firm Growth: Evidence from China’s New Generation IT Industry. Sustainability. 2019; 11(7):2000. https://doi.org/10.3390/su11072000
Chicago/Turabian StyleLi, Hongya, Laiqun Jin, and Yuanyao Ding. 2019. "Innovation, Mark-Up and Firm Growth: Evidence from China’s New Generation IT Industry" Sustainability 11, no. 7: 2000. https://doi.org/10.3390/su11072000