Pub Date : 2026-01-20DOI: 10.1016/j.jcae.2026.100542
Anthony C. Ng , Ferdinand A. Gul
This study investigates whether financially distressed firms in Australia utilize integrated reporting (IR) as a tool for impression management (IM) to conceal poor financial performance. Using data from 2015 to 2017, we construct an IR conformity (IRC) index based on the International Integrated Reporting Council (IIRC) framework. We find a non-linear and concave relationship between IRC and firm value among distressed firms: while moderate IR conformity is positively associated with firm value, higher conformity is penalized by the market. Additional corroborative analyses reveal similar non-linear patterns between IRC and bid–ask spreads, crash risk, and earnings management proxies. These findings suggest that distressed firms may strategically adopt IR to manage impressions rather than enhance transparency and that capital markets tend to respond negatively to excessive IR conformity.
{"title":"Impression management in financially distressed firms: Evidence from integrated reporting in Australia","authors":"Anthony C. Ng , Ferdinand A. Gul","doi":"10.1016/j.jcae.2026.100542","DOIUrl":"10.1016/j.jcae.2026.100542","url":null,"abstract":"<div><div>This study investigates whether financially distressed firms in Australia utilize integrated reporting (IR) as a tool for impression management (IM) to conceal poor financial performance. Using data from 2015 to 2017, we construct an IR conformity (IRC) index based on the International Integrated Reporting Council (IIRC) framework. We find a non-linear and concave relationship between IRC and firm value among distressed firms: while moderate IR conformity is positively associated with firm value, higher conformity is penalized by the market. Additional corroborative analyses reveal similar non-linear patterns between IRC and bid–ask spreads, crash risk, and earnings management proxies. These findings suggest that distressed firms may strategically adopt IR to manage impressions rather than enhance transparency and that capital markets tend to respond negatively to excessive IR conformity.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100542"},"PeriodicalIF":2.9,"publicationDate":"2026-01-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146077220","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-16DOI: 10.1016/j.jcae.2026.100543
Jiwoo Seo , Adam M. Esplin , Yun Ke , Kari Joseph Olsen
In the U.S. CEO labor market, firms are more likely to hire local CEOs than non-local CEOs. We examine the impact of this hiring practice on the voluntary disclosure of firm financial information in the non-GAAP earnings setting. Using a sample of S&P 1500 firms from 2003 to 2020, we show that firms led by local CEOs are less likely to provide non-GAAP earnings than those led by non-local CEOs. This result holds across a battery of robustness tests, including a placebo test, various matching procedures, an instrumental variable approach, different regression specifications, and alternative samples using CEO turnover events. We also find that local CEOs are less likely to use non-GAAP earnings to meet or beat earnings targets and that investors react more to changes in non-GAAP earnings issued by firms with local CEOs. This pattern of results is consistent with the interpretation that local CEOs are less likely to use non-GAAP earnings opportunistically for image management purposes. Our results suggest that hiring bias toward local CEOs shapes both the frequency and the credibility of firms’ voluntary disclosure practices.
{"title":"Local CEOs and voluntary Disclosure: Evidence from Non-GAAP earnings","authors":"Jiwoo Seo , Adam M. Esplin , Yun Ke , Kari Joseph Olsen","doi":"10.1016/j.jcae.2026.100543","DOIUrl":"10.1016/j.jcae.2026.100543","url":null,"abstract":"<div><div>In the U.S. CEO labor market, firms are more likely to hire local CEOs than non-local CEOs. We examine the impact of this hiring practice on the voluntary disclosure of firm financial information in the non-GAAP earnings setting. Using a sample of S&P 1500 firms from 2003 to 2020, we show that firms led by local CEOs are less likely to provide non-GAAP earnings than those led by non-local CEOs. This result holds across a battery of robustness tests, including a placebo test, various matching procedures, an instrumental variable approach, different regression specifications, and alternative samples using CEO turnover events. We also find that local CEOs are less likely to use non-GAAP earnings to meet or beat earnings targets and that investors react more to changes in non-GAAP earnings issued by firms with local CEOs. This pattern of results is consistent with the interpretation that local CEOs are less likely to use non-GAAP earnings opportunistically for image management purposes. Our results suggest that hiring bias toward local CEOs shapes both the frequency and the credibility of firms’ voluntary disclosure practices.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100543"},"PeriodicalIF":2.9,"publicationDate":"2026-01-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145976129","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-10DOI: 10.1016/j.jcae.2026.100541
Yang Pan , Xihao Wu
Whether and how local governments’ taxation role influences state-owned enterprises’ (SOEs) tax avoidance decisions remains underexplored. Utilizing China’s Tax Centralization Reform (TCR) as a quasi-natural experiment, this study investigates how the reallocation of tax enforcement authority from local to central governments influences the tax avoidance behavior of local SOEs. Employing a difference-in-differences (DID) design on a sample of Chinese listed SOEs from 2015 to 2022, we document that the TCR significantly reduces tax avoidance among local SOEs. Heterogeneity analysis further indicates that this effect is more substantial for (1) SOEs with higher local government ownership, (2) firms located in regions where local governments exhibit greater fiscal reliance on SOEs, (3) areas with stronger government intervention, and (4) jurisdictions with higher fiscal decentralization. We also examine post-TCR dividend policies and find that local SOEs, reducing tax avoidance, subsequently cut cash dividends. Collectively, the TCR curbs local SOE tax avoidance by restricting local governments’ discretionary tax enforcement.
{"title":"The role of local governments in tax enforcement and tax avoidance by local state-owned enterprises: evidence from China","authors":"Yang Pan , Xihao Wu","doi":"10.1016/j.jcae.2026.100541","DOIUrl":"10.1016/j.jcae.2026.100541","url":null,"abstract":"<div><div>Whether and how local governments’ taxation role influences state-owned enterprises’ (SOEs) tax avoidance decisions remains underexplored. Utilizing China’s Tax Centralization Reform (TCR) as a quasi-natural experiment, this study investigates how the reallocation of tax enforcement authority from local to central governments influences the tax avoidance behavior of local SOEs. Employing a difference-in-differences (DID) design on a sample of Chinese listed SOEs from 2015 to 2022, we document that the TCR significantly reduces tax avoidance among local SOEs.<!--> <!-->Heterogeneity analysis further indicates that this effect is more substantial for (1) SOEs with higher local government ownership, (2) firms located in regions where local governments exhibit greater fiscal reliance on SOEs, (3) areas with stronger government intervention, and (4) jurisdictions with higher fiscal decentralization. We also examine post-TCR dividend policies and find that local SOEs, reducing tax avoidance, subsequently cut cash dividends. Collectively, the TCR curbs local SOE tax avoidance by restricting local governments’ discretionary tax enforcement.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100541"},"PeriodicalIF":2.9,"publicationDate":"2026-01-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145976196","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-08DOI: 10.1016/j.jcae.2026.100540
Harvey Nguyen , Anh Viet Pham , Man Duy (Marty) Pham , Mia Hang Pham
Drawing on the debate over how environmental and social (E&S) commitments help firms withstand economic recessions, this study asks whether, and to what extent, a firm’s E&S performance helps it secure government economic support under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. We find that firms committed to greater social responsibility are more likely to gain access to and receive larger amounts of bailout grants and loans. The impact of the social image is more pronounced for firms that would be otherwise disadvantaged in competing for the relief funds. Gaining access to rescue packages enables firms to mitigate corporate default risk and enhance shareholder wealth through improved market liquidity. Overall, the findings support that better ESG performance is among the distinctive attributes that shape government agencies’ scarce resource allocation decisions.
{"title":"Resource allocation in times of need: the role of social commitments","authors":"Harvey Nguyen , Anh Viet Pham , Man Duy (Marty) Pham , Mia Hang Pham","doi":"10.1016/j.jcae.2026.100540","DOIUrl":"10.1016/j.jcae.2026.100540","url":null,"abstract":"<div><div>Drawing on the debate over how environmental and social (E&S) commitments help firms withstand economic recessions, this study asks whether, and to what extent, a firm’s E&S performance helps it secure government economic support under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. We find that firms committed to greater social responsibility are more likely to gain access to and receive larger amounts of bailout grants and loans. The impact of the social image is more pronounced for firms that would be otherwise disadvantaged in competing for the relief funds. Gaining access to rescue packages enables firms to mitigate corporate default risk and enhance shareholder wealth through improved market liquidity. Overall, the findings support that better ESG performance is among the distinctive attributes that shape government agencies’ scarce resource allocation decisions.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100540"},"PeriodicalIF":2.9,"publicationDate":"2026-01-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145976127","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-03DOI: 10.1016/j.jcae.2026.100539
Pan Li , Yun Zhong , Han Yan
The government-court coordination mechanism initiative represents an innovative strategy aimed at fostering high-quality economic development in China. This approach effectively addresses informational barriers among various governmental departments by merging the administrative resources of the government with the judicial resources of the courts, thereby enhancing collaborative governance between administrative and judicial entities. This paper presents an empirical analysis based on data from Chinese A-share listed companies spanning the years 2010 to 2024 utilizing a multi-point difference-in-differences (DID) methodology. The findings indicate that the government-court coordination mechanism exerts a significant positive influence on corporate investment efficiency. The mechanism test shows that the GCC mechanism improves the investment efficiency of firms by improving the business environment and optimizing the information environment. Additionally, a heterogeneity analysis reveals that the effects of the government-court coordination mechanism are more pronounced in cities characterized by lower fiscal pressure and stronger incentives for official promotions, as well as in non-state-owned enterprises and those facing competitive disadvantages. This paper not only empirically substantiates the critical role of the government-court coordination mechanism in improving corporate investment efficiency, serving as a notable example of governance innovation in China, but also offers valuable governance insights for other developing nations.
{"title":"The constructive interaction between executive and judicial powers: Government-court coordination and corporate investment efficiency","authors":"Pan Li , Yun Zhong , Han Yan","doi":"10.1016/j.jcae.2026.100539","DOIUrl":"10.1016/j.jcae.2026.100539","url":null,"abstract":"<div><div>The government-court coordination mechanism initiative represents an innovative strategy aimed at fostering high-quality economic development in China. This approach effectively addresses informational barriers among various governmental departments by merging the administrative resources of the government with the judicial resources of the courts, thereby enhancing collaborative governance between administrative and judicial entities. This paper presents an empirical analysis based on data from Chinese A-share listed companies spanning the years 2010 to 2024 utilizing a multi-point difference-in-differences (DID) methodology. The findings indicate that the government-court coordination mechanism exerts a significant positive influence on corporate investment efficiency. The mechanism test shows that the GCC mechanism improves the investment efficiency of firms by improving the business environment and optimizing the information environment. Additionally, a heterogeneity analysis reveals that the effects of the government-court coordination mechanism are more pronounced in cities characterized by lower fiscal pressure and stronger incentives for official promotions, as well as in non-state-owned enterprises and those facing competitive disadvantages. This paper not only empirically substantiates the critical role of the government-court coordination mechanism in improving corporate investment efficiency, serving as a notable example of governance innovation in China, but also offers valuable governance insights for other developing nations.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100539"},"PeriodicalIF":2.9,"publicationDate":"2026-01-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145976128","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-03DOI: 10.1016/j.jcae.2025.100537
Se Chen , Shaojie Lai , Zixuan Luo , Qing Sophie Wang
This study investigates the impact of enhanced minority shareholder influence on labor investment efficiency (LIE). Leveraging China’s online voting reform as a natural experiment, our analysis reveals that firms experiencing greater minority shareholder influence tend to exhibit lower LIE relative to control firms. We attribute this decline to increased pressure for short-term performance and potential managerial short-sightedness. Our research further demonstrates that this relative decrease in LIE is primarily driven by the actions of individual investors. The effect is more pronounced in firms characterized by weaker CEO power and greater financial constraints, which heighten their vulnerability to the influence of minority shareholders. Our findings are robust across various measures and address potential endogeneity concerns. Overall, this study highlights the intricate implications of empowering minority shareholders.
{"title":"Minority shareholder influence and labor investment efficiency: Evidence from China’s online voting reform","authors":"Se Chen , Shaojie Lai , Zixuan Luo , Qing Sophie Wang","doi":"10.1016/j.jcae.2025.100537","DOIUrl":"10.1016/j.jcae.2025.100537","url":null,"abstract":"<div><div>This study investigates the impact of enhanced minority shareholder influence on labor investment efficiency (LIE). Leveraging China’s online voting reform as a natural experiment, our analysis reveals that firms experiencing greater minority shareholder influence tend to exhibit lower LIE relative to control firms. We attribute this decline to increased pressure for short-term performance and potential managerial short-sightedness. Our research further demonstrates that this relative decrease in LIE is primarily driven by the actions of individual investors. The effect is more pronounced in firms characterized by weaker CEO power and greater financial constraints, which heighten their vulnerability to the influence of minority shareholders. Our findings are robust across various measures and address potential endogeneity concerns. Overall, this study highlights the intricate implications of empowering minority shareholders.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100537"},"PeriodicalIF":2.9,"publicationDate":"2026-01-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145924456","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2026-01-02DOI: 10.1016/j.jcae.2026.100538
Yue Zhang, Yimeng Zhao, Ruoxuan Huang
Utilizing data from Chinese A-share listed firms from 2007 to 2023, this paper empirically examines the impact of information security management on trade credit. The research findings reveal that firms receive more trade credit after the implementation of the ISO 27001 certification. After conducting endogeneity tests and other robustness checks, the research findings remain consistent. Mechanism analysis shows that information security management increases trade credit primarily by reducing firm risk and improving firm bargaining power. Cross-sectional analysis demonstrates that the influence of information security management on trade credit is more pronounced in state-owned enterprises, firms that have experienced information security issues and firms with poorer corporate governance. Economic consequences analysis demonstrates that the facilitating effect of information security management on trade credit contributes to reducing the financialization level of firms.
{"title":"Information security management and trade credit: evidence from Chinese listed firms","authors":"Yue Zhang, Yimeng Zhao, Ruoxuan Huang","doi":"10.1016/j.jcae.2026.100538","DOIUrl":"10.1016/j.jcae.2026.100538","url":null,"abstract":"<div><div>Utilizing data from Chinese A-share listed firms from 2007 to 2023, this paper empirically examines the impact of information security management on trade credit. The research findings reveal that firms receive more trade credit after the implementation of the ISO 27001 certification. After conducting endogeneity tests and other robustness checks, the research findings remain consistent. Mechanism analysis shows that information security management increases trade credit primarily by reducing firm risk and improving firm bargaining power. Cross-sectional analysis demonstrates that the influence of information security management on trade credit is more pronounced in state-owned enterprises, firms that have experienced information security issues and firms with poorer corporate governance. Economic consequences analysis demonstrates that the facilitating effect of information security management on trade credit contributes to reducing the financialization level of<!--> <!-->firms.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100538"},"PeriodicalIF":2.9,"publicationDate":"2026-01-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145924455","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-31DOI: 10.1016/j.jcae.2025.100536
Kun Su, Yixuan Fan, Jiahao Yan
This study examines the relationship between local happiness and firm total factor productivity at the firm level. We find that local happiness is positively associated with firms’ total factor productivity. Our mechanism analysis indicates that local happiness improves firms’ total factor productivity by attracting human and capital resources, promoting labor productivity, and stimulating innovation. We also find that the positive effect of local happiness on total factor productivity is more pronounced in firms with low human capital, firms located in regions with advanced digital infrastructure, and in non-state-owned firms. Our research offers recommendations for governments on how to prioritize people’s well-being and achieve economic objectives.
{"title":"With happy we are more productive: Evidence from total factor productivity","authors":"Kun Su, Yixuan Fan, Jiahao Yan","doi":"10.1016/j.jcae.2025.100536","DOIUrl":"10.1016/j.jcae.2025.100536","url":null,"abstract":"<div><div>This study examines the relationship between local happiness and firm total factor productivity at the firm level. We find that local happiness is positively associated with firms’ total factor productivity. Our mechanism analysis indicates that local happiness improves firms’ total factor productivity by attracting human and capital resources, promoting labor productivity, and stimulating innovation. We also find that the positive effect of local happiness on total factor productivity is more pronounced in firms with low human capital, firms located in regions with advanced digital infrastructure, and in non-state-owned firms. Our research offers recommendations for governments on how to prioritize people’s well-being and achieve economic objectives.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100536"},"PeriodicalIF":2.9,"publicationDate":"2025-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145883352","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-28DOI: 10.1016/j.jcae.2025.100535
Bobae Choi , Doowon Lee , Kyoungwon Mo
This study examines whether conflicts of interest induced by group affiliation between asset management companies (AMCs) and brokerage firms compromise the independence of the affiliated analysts’ forecasts. That is, we investigate whether affiliated analysts treat stocks held by mutual funds in the same chaebol group differently from other stocks. Our main results indicate that analyst forecasts are selectively optimistic about the stocks that are of the greatest interest to affiliated AMCs. Specifically, analysts produce more accurate forecasts for stocks held by affiliated AMCs in general, while their recommendations and forecasts become more optimistic and less accurate as the amount of funding invested in such stocks increases within a fund held by affiliated fund managers. Selective optimism is also found when the asset management fees are high and when those stocks are newly added to the funds held by affiliated fund managers.
{"title":"Selective optimism of analysts affiliated with mutual funds","authors":"Bobae Choi , Doowon Lee , Kyoungwon Mo","doi":"10.1016/j.jcae.2025.100535","DOIUrl":"10.1016/j.jcae.2025.100535","url":null,"abstract":"<div><div>This study examines whether conflicts of interest induced by group affiliation between asset management companies (AMCs) and brokerage firms compromise the independence of the affiliated analysts’ forecasts. That is, we investigate whether affiliated analysts treat stocks held by mutual funds in the same chaebol group differently from other stocks. Our main results indicate that analyst forecasts are selectively optimistic about the stocks that are of the greatest interest to affiliated AMCs. Specifically, analysts produce more accurate forecasts for stocks held by affiliated AMCs in general, while their recommendations and forecasts become more optimistic and less accurate as the amount of funding invested in such stocks increases within a fund held by affiliated fund managers. Selective optimism is also found when the asset management fees are high and when those stocks are newly added to the funds held by affiliated fund managers.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100535"},"PeriodicalIF":2.9,"publicationDate":"2025-12-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145924407","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-12-28DOI: 10.1016/j.jcae.2025.100534
Chao Liang , Bai Liu
Technology diffusion has facilitated long-term socio-economic progress. Therefore, most countries are striving to offer an environment conducive to innovation, including the establishment of appropriate intellectual property rights (IPR). However, the role of IPR in promoting technology diffusion remains controversial. Specifically, patents promote technology diffusion by protecting inventions and disclosing knowledge to the public, while triggering exclusive rights that may hinder technology diffusion. Based on signal theory, the existing research perspective is extended from “point-to-point” (inventor-imitator) to “point-to-side” (inventor-potential inventor) to investigate the technology diffusion regarding peer firms of defendant in patent litigation. The results show stronger technology diffusion in peer firms of defendant after patent litigation. Two mechanisms of litigation signals are demonstrated through grouping tests: legitimacy and competitiveness. This study contributes to resolving the contradictory literature on IPR and technology diffusion, while also complementing studies on IPR in developing countries.
{"title":"Enabler or barrier: Impact of patent protection on technology diffusion in China","authors":"Chao Liang , Bai Liu","doi":"10.1016/j.jcae.2025.100534","DOIUrl":"10.1016/j.jcae.2025.100534","url":null,"abstract":"<div><div>Technology diffusion has facilitated long-term socio-economic progress. Therefore, most countries are striving to offer an environment conducive to innovation, including the establishment of appropriate intellectual property rights (IPR). However, the role of IPR in promoting technology diffusion remains controversial. Specifically, patents promote technology diffusion by protecting inventions and disclosing knowledge to the public, while triggering exclusive rights that may hinder technology diffusion. Based on signal theory, the existing research perspective is extended from “point-to-point” (inventor-imitator) to “point-to-side” (inventor-potential inventor) to investigate the technology diffusion regarding peer firms of defendant in patent litigation. The results show stronger technology diffusion in peer firms of defendant after patent litigation. Two mechanisms of litigation signals are demonstrated through grouping tests: legitimacy and competitiveness. This study contributes to resolving the contradictory literature on IPR and technology diffusion, while also complementing studies on IPR in developing countries.</div></div>","PeriodicalId":46693,"journal":{"name":"Journal of Contemporary Accounting & Economics","volume":"22 1","pages":"Article 100534"},"PeriodicalIF":2.9,"publicationDate":"2025-12-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145883351","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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