An Empirical Research About The Influences Of Accounting Information Quality On Innovation

Accounting information is the most crucial information mechanism in maintaining the effectively functioning of market economic system which is dominated by the management model with ownership and control separated.Investment is the core of the three corporate financial policy.If information asymmetry exists,both moral hazard and adverse selection problem incur investment inefficiency,and capital will be misallocated.In the last decade,scholars begin to focus on the impact of accounting information on investment.Most related research just focus on the whole investment,while little attention is paid to a certain investment item.However,innovation is special,and is distinguish with other investment items in risk and return characteristics.Besides,innovation is important,and is meaningful to firms' core competitiveness and high speed economic development.Therefore,it is necessary to focus on the impact of accounting information quality on innovation.Accordingly,this paper studies the relationship between accounting information quality and innovation,constructs the theoretical framework,and studies how accounting information quality impacts innovation,enriching the related research about the economic consequences of accounting information quality and the impactors of innovation.This paper constructs the theoretical framework of the impact of accounting information quality on innovation.Based on information asymmetry,investor protection,agency and contract theory,this paper applies document and normative analysis method,and constructs the theoretical framework about the impact of accounting information quality on innovation.In the theoretical framework,starting from the realization of innovation in the view of information,this paper studies the impact of accounting information on innovation,and determines that mitigating agency problem,decreasing financial constraint and reducing ineffective investment degree are the key channels,and analyzes the institutional-contingency of the impact,and constructs the related framework,which is the theoretical basis of the whole paper.To find whether accounting information quality affect innovation,multi-regression analysis is applied.The results show that accounting information quality significantly improves innovation when firm characteristics and corporate governance are controlled.By controlling endogeneity,the positive impact of accounting information quality on innovation are still exist.To get how accounting information quality affects innovation,this paper bases on the theoretical framework of the impact of accounting information quality on innovation,and applies information asymmetry,agencyand contract theory,and to analysis the channels of financing,governance and investment channel,and proposes related research hypothesis.The results are as followed.Accounting information quality positively impact innovation through the channel of mitgrating financial constraint,reducing agency problems,and improving investment efficienty.This paper studies the institutional-contingency of the impact of accounting information quality on innovation.This paper analysis the differences of the impact of accounting information quality on innovation under different law environment,financial market and government interference,and proposes related hypothesis.The results are as followed.The imperfection level of law environment,the undeveloped degree of financial market,the strength degree of government intervention enhances the impact of accounting information on innovation.The relationship between accounting information quality and the institute environment,which includes law environment,financial market environment and government intervern environment,are complement but not subsititute in the aspect of prompting innovation.This paper develops the impact of accounting information quality on the value effect of innovation.From the three dimensions of value,which are productive value,financial value and market value,this paper analyzes the mechanism that accounting information acts on the value effect of innovation in theory.Using the listing firms in China as sample,this paper applies Douglas production model and multi-regression model to examine the hypothesis.The results are as followed.Firstly,Innovation owns significant positive value effects,which include productive value effect,financial value effect and market value effect.Secondly,accounting information quality significantly improve innovation's value effects,which include productive value effect,financial value effect and market value effect.Both international and domestic scholars are from the view of corporates' whole investment,when they examine the relationship between accounting information quality and investment.Different from the extant research,this paper is from the view of a specific investment,which is innovation.In theory,this paper provides theoretical basis for the relationship between accounting information quality and innovation,and enriches the theoretical content of accounting information quality,and completes the theory of innovation,and adds to the theory of institution,develops economic growth theory,and contributes to discover the impact mechanism and impact effect of accounting information quality on innovation.In practical,this paper contributes to improve firms' initiative to improve accounting information quality,and provides evidence for government to enforce firms to offer high accounting information quality,and encourages firms to guide resource allocate from market to firm and form firm to innovation by information mechanism,and reduce the transaction cost related to innovation,and improve resource allocation efficiency.