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Taking the A-share listed companies in Shanghai and Shenzhen from 2013 to 2020 as the research object, this paper discusses the impact of innovation on high-quality development at the enterprise level and evaluates the effectiveness of the current transformation of innovation driving China’s economic development mode. It is found that innovation inhibits the improvement of total factor productivity of enterprises overall and hinders the high-quality development of enterprises. This result also shows that China’s innovation driven economic development mode transformation has not achieved actual effect. The reason is that China is still in the dilemma that low-quality innovation occupies the dominant position of enterprise innovation. The inhibitory effect of low-quality innovation masks the promoting effect of high-quality innovation, which makes the net effect of innovation on enterprise productivity being inhibitory, and this inhibition is characterized by a loss of efficiency, which is caused by a mismatch of resources. Heterogeneity analysis shows that the inhibition effect of innovation is stronger in eastern enterprises, non-state-owned enterprises and the early implementation of innovation driven strategy. It is also found that the promotion effect of high-quality innovation on executive compensation is stronger than that of low-quality innovation, which indicates that carrying out low-quality innovation is an irrational and short-sighted behavior. The study provides important insights for China to optimize and improve innovation policies and to promote the shift of the overall innovation structure to high-quality innovation.
Huang et al. (Sun,) studied this question.