Sharing weal and woe: Do geopolitical risks affect corporate innovation? A global supply chain perspective

IF 9.8 1区经济学 Q1 BUSINESS, FINANCE

International Review of Financial Analysis Pub Date : 2025-07-17 DOI:10.1016/j.irfa.2025.104474

Ziyin Huang , Zhuopin Guo , Junsong Chen , Jin Huang

{"title":"Sharing weal and woe: Do geopolitical risks affect corporate innovation? A global supply chain perspective","authors":"Ziyin Huang , Zhuopin Guo , Junsong Chen , Jin Huang","doi":"10.1016/j.irfa.2025.104474","DOIUrl":null,"url":null,"abstract":"<div><div>Two theories offer conflicting predictions on the relationship between uncertainty from geopolitical risks (GPR) and firm innovative investment and have not yet reached a consensus. To reconcile the two strands of literature and provide a fuller picture of GPR's effect, we explore the influence of GPR on companies' R&D investment in the global supply chain setting. By applying the customer-induced GPR we find that GPR has a positive impact on R&D investment. The results are robust after using different measures of GPR and instrumental variable approach. Moreover, we investigate the mechanism through which GPR affects firm R&D investment and find that growth option and firm liquidity are the main mechanisms. Further empirical analysis indicates that this positive impact is strengthened for firms that operate in high-tech industries, or have weaker political connections. Moreover, the positive impact of customer-induced GPR only generates when the largest company has a high sales proportion of the focal company.</div></div>","PeriodicalId":48226,"journal":{"name":"International Review of Financial Analysis","volume":"106 ","pages":"Article 104474"},"PeriodicalIF":9.8000,"publicationDate":"2025-07-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"International Review of Financial Analysis","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1057521925005617","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}

引用次数: 0

Abstract

Two theories offer conflicting predictions on the relationship between uncertainty from geopolitical risks (GPR) and firm innovative investment and have not yet reached a consensus. To reconcile the two strands of literature and provide a fuller picture of GPR's effect, we explore the influence of GPR on companies' R&D investment in the global supply chain setting. By applying the customer-induced GPR we find that GPR has a positive impact on R&D investment. The results are robust after using different measures of GPR and instrumental variable approach. Moreover, we investigate the mechanism through which GPR affects firm R&D investment and find that growth option and firm liquidity are the main mechanisms. Further empirical analysis indicates that this positive impact is strengthened for firms that operate in high-tech industries, or have weaker political connections. Moreover, the positive impact of customer-induced GPR only generates when the largest company has a high sales proportion of the focal company.

查看原文本刊更多论文

同甘共苦：地缘政治风险会影响企业创新吗？全球供应链视角

两种理论对地缘政治风险不确定性（GPR）与企业创新投资之间的关系给出了相互矛盾的预测，尚未达成共识。为了调和这两种文献并提供更全面的GPR效应，我们探讨了GPR对公司在全球供应链环境中的研发投资的影响。通过应用顾客诱导的GPR，我们发现GPR对研发投资有正向影响。采用不同的探地雷达测量方法和工具变量方法后，结果具有鲁棒性。此外，本文还研究了GPR对企业r&d投资的影响机制，发现成长性选择和企业流动性是影响企业r&d投资的主要机制。进一步的实证分析表明，对于经营高科技产业或政治关系较弱的公司，这种积极影响得到加强。此外，只有当最大的公司与焦点公司的销售比例较高时，客户诱导的GPR才会产生积极的影响。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

International Review of Financial Analysis BUSINESS, FINANCE-

CiteScore

10.30

自引率

9.80%

发文量

366

期刊介绍： The International Review of Financial Analysis (IRFA) is an impartial refereed journal designed to serve as a platform for high-quality financial research. It welcomes a diverse range of financial research topics and maintains an unbiased selection process. While not limited to U.S.-centric subjects, IRFA, as its title suggests, is open to valuable research contributions from around the world.