Linkage Between Inclusive Digital Finance and High-Tech Enterprise Innovation Performance: Role of Debt and Equity Financing

This study investigates the relationship between digital financial inclusion, external financing, and the innovation performance of high-tech enterprises in China. The choice of corporate financing methods is an important part of organizational behavioral psychology, and different financing models will have a certain effect on organizational performance, especially in the digital economy environment. Therefore, based on resource dependence theory and financing constraint theory, the present study utilizes the panel data collected from the China Stock Market & Accounting Research (CSMAR) database from 2011 to 2020 of 112 companies in the Yangtze River Delta region and the "The Peking University Digital Financial Inclusion Index of China (PKU-DFIIC)" released by the Peking University Digital Finance Research Center and Ant Financial Group. The results show that the Digital Financial Inclusion Index (DFIIC) has a significant positive correlation with the innovation performance of high-tech enterprises. The higher the level of debt financing, the stronger the role of digital financial inclusion in promoting innovation performance. Investigating the DFIIC in terms of coverage breadth and usage depth, we find that usage depth does not significantly encourage innovation performance. The effect of the interaction between coverage breadth and external financing is consistent with the results for the DFIIC. The study suggests that equity financing promotes the usage depth of the DFIIC in state-owned enterprises. In contrast, debt financing promotes the coverage breadth of non-state-owned enterprises. Finally, we propose relevant policy recommendations based on the research results. It includes in-depth popularization of inclusive finance in the daily operations of enterprises at the technical level, refinement of external financing policy incentives for enterprises based on the characteristics of ownership, and strengthening the research of technologies such as big data, artificial intelligence (AI), and cloud computing. The paper presents a range of theoretical and practical implications for practitioners and academics relevant to high-tech enterprises.