The impact of mixed-ownership reform on breakthrough innovation of state-owned enterprises

Mixed-ownership reform, as a key breakthrough in deepening the reform of state-owned enterprises, has increasingly become an effective approach to stimulating innovation vitality and enhancing the innovation capacity of state-owned enterprises (SOEs). Based on panel data of A-share listed companies in Shanghai and Shenzhen from 2005 to 2022, this study employs a difference-in-difference model to empirically examine the impact and underlying mechanisms of mixed-ownership reform on breakthrough innovation in SOEs. The study finds that: First, mixed-ownership reform significantly enhances the level of breakthrough innovation in SOEs. Second, in terms of the mechanism, mixed-ownership reform improves breakthrough innovation by reducing the financing constraints of SOEs. Third, the effect of mixed ownership reform on promoting breakthrough innovation in state-owned enterprises is relatively stronger among firms with higher management expenses, more intense market competition, and greater absorptive capacity. The study reveals the impact of mixed-ownership reform on the breakthrough innovation of SOEs, providing practical insights into unlocking the innovation potential of enterprises.