The Impact of Debt Leverage on Corporate Innovation Resilience: An Empirical Study Based on the Internet Industry
- 1 School of Finance and Economics, Wuhan College, Wuhan, China
- 2 School of Finance and Economics, Wuhan College, Wuhan, China
Abstract
Taking A-share listed Internet and related digital service enterprises as the research objects, this paper uses financial and R&D data from 25 listed companies over 2021-2025. Since IR and Growth are measured by growth rates requiring prior-year values, the final regression sample covers fiscal years 2022-2025, generating 100 firm-year observations. Corporate innovation resilience is measured by the growth rate of R&D expenses, debt leverage is measured by the asset-liability ratio, and firm size, profitability, and growth ability are controlled for. The results show that debt leverage is negatively associated with corporate innovation resilience, indicating that a higher debt level may exert pressure on enterprises’ continuous R&D investment. However, this effect does not show stable statistical significance in the sample. By contrast, corporate growth ability and firm size have a more pronounced effect on innovation resilience. The study suggests that Internet enterprises should reasonably control debt scale, optimize financing structure, and improve business growth ability and R&D investment efficiency in the process of enhancing innovation resilience.
- Aghion, P., Bond, S., Klemm, A., & Marinescu, I. (2004). Technology and Financial Structure: Are Innovative Firms Different? Journal of the European Economic Association, 2, 277-288. https://doi.org/10.1162/154247604323067989
- Bhagat, S., & Welch, I. (1995). Corporate Research & Development Investments International Comparisons. Journal of Accounting and Economics, 19, 443-470. https://doi.org/10.1016/0165-4101(94)00391-h
- Brown, J. R., Fazzari, S. M., & Petersen, B. C. (2009). Financing Innovation and Growth: Cash Flow, External Equity, and the 1990s R&D Boom. The Journal of Finance, 64, 151-185. https://doi.org/10.1111/j.1540-6261.2008.01431.x
- China Securities Regulatory Commission (2024). Industry Statistical Classification and Codes for Listed Companies (JR/T 0020 - 2024) . (In Chinese) https://www.csrc.gov.cn/csrc/c101954/c7520291/7520291/files/%E9%99%84%E4%BB%B61%EF%BC%9A%E3%80%8A%E4%B8%8A%E5%B8%82%E5%85%AC%E5%8F%B8%E8%A1%8C%E4%B8%9A%E7%BB%9F%E8%AE%A1%E5%88%86%E7%B1%BB%E4%B8%8E%E4%BB%A3%E7%A0%81%E3%80%8B.pdf
- Hall, B. H., & Lerner, J. (2010). The Financing of R&D and Innovation. In B. H. Hall, & N. Rosenberg (Eds.), Handbook of the Economics of Innovation (Vol. 1, pp. 609-639). Elsevier. https://doi.org/10.1016/s0169-7218(10)01014-2
- Hamel, G., & Valikangas, L. (2003). The Quest for Resilience. Harvard Business Review, 81, 52-65.
- Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3, 305-360. https://doi.org/10.1016/0304-405x(76)90026-x
- Modigliani, F., & Miller, M. H. (1958). The Cost of Capital, Corporation Finance and the Theory of Investment. The American Economic Review, 48, 261-297.