The Effect of Confucianism on Corporate Innovation : Evidence from High-Tech Industries in China

This paper examines the multi-dimensional effects of Confucianism on corporate innovation in China. Using a sample of firms in high-tech industries during 2011 to 2020, we found that Confucianism restricts corporate innovation output. In particular, the hierarchical social order and masculinity dimensions are the channels through which Confucianism inhibits corporate innovation. Moreover, the effect of Confucianism on innovation performance is more pronounced on firms headquartered in regions characterized by low levels of foreign investment and weak legal protections. Our findings are robust to endogeneity and measurement issues and shed light on the effect of culture on corporate innovation in emerging markets