The Inhibitory Mechanism of Financial Investment on Technological Innovation and the Moderating Effect of Managerial Behavior

Abstract

Innovation is the primary factor driving enterprise development. Based on Chinese A-share non-financial listed companies from 2009 to 2022, this paper employs fixed-effect regression models and heterogeneity tests to empirically examine the impact of corporate financialization on technological innovation. We further introduce managerial overconfidence as a moderating variable to analyze its effect on the relationship between innovation input and output. The results show that corporate financial asset investment significantly inhibits technological innovation, as reflected by simultaneous declines in R&D input and innovation output. Managerial overconfidence mitigates the negative impact of financialization on innovation output to a certain extent, and this effect is particularly pronounced in high-tech industries and non-state-owned enterprises, indicating the moderating roles of ownership and industry attributes. These findings enrich the theoretical research at the intersection of behavioral finance and innovation economics, and provide practical implications for policymakers. We emphasize that optimizing resource allocation, improving corporate governance, and strengthening differentiated support can guide enterprises to control financialization risks while achieving high-quality innovative development.