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| The Effect of Seasonal Equity Offerings and External Financial Dependence on Corporate Innovation of Listed Manufacturing Companies |
| LIU Duan，CHEN Shiqi，CHEN Shou |
| Hunan University, Changsha, China |
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Abstract Based on Chinese listed companies in the manufacturing industry from 2007 to 2015, this study uses Heckman-two-stage regression method to investigate the effect of equity offerings on corporate R&D investment and innovation outputs. Furthermore, this study analyses the role of external financial dependence in this effect from the two levels of company and industry. Simultaneously, we make the test robustness using substitution of variables and methods. Our empirical findings are: ①Equity offerings in China’s capital market obviously facilitate corporate R&D investment and following innovation outputs. ②External financial dependence of both company and industry has a significant positive moderating effect on the relationship between equity offerings and corporate innovation, that is say, corporate external financial dependence can effectively stimulate companies to enhance R&D investment and innovation outputs through equity offerings. Moreover, the study finds that R&D investment plays a full intermediary role in the relationship between equity offerings and innovation outputs.
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Received: 11 September 2018
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