Publication Type

PhD Dissertation

Version

publishedVersion

Publication Date

3-2026

Abstract

Against the dual backdrop of the in-depth implementation of the innovation-driven development strategy and the continuous deepening of SOE reforms, restricted equity has emerged a mainstream instrument for medium- and long-term employee incentives in Chinese SOEs. However, the underlying mechanisms, effect characteristics, and boundary conditions through which employee restricted equity incentives influence innovation efficiency in SOEs remain to be systematically examined. Drawing on panel data of 4,880 firm-year observation from Chinese A-share SOMEs over the period of 2015-2024, this study develops a direct effect model of “Equity Incentives-Innovation Efficiency” from the perspective of employee restricted equity grants. It further introduces “the marketization level” (as an external institutional environment) and “CEO Duality” (as an internal governance structure) to empirically examine their moderating effects on the relationship between employee restricted equity incentives and innovation efficiency in SOEs. The key findings are as follows: 1) Employee Restricted Equity Incentives have a significant positive impact on the innovation efficiency of SOEs, characterized by a one- to two-year lag, a five-year cumulative increase, information independence, and targeted reinforcement of core technologies; 2) The marketization level does not exhibit a significant positive moderating effect on the innovation outcomes of equity incentives, suggesting that the policy-driven and non-market-oriented nature of innovation resource allocation in SOEs weakens the marginal influence of the external institutional environment; 3) CEO Duality has a significant conditional negative moderating effect on the innovation effect of equity incentives, while a sound internal supervision mechanism can effectively mitigate this negative effect; 4) The effect of equity incentives on innovation is significantly heterogeneous, and it becomes stronger in innovation-intensive manufacturing industries and targeted incentive samples for R&D personnel.

These findings enrich the theoretical framework of equity incentives and innovation efficiency for Chinese SOEs within the context of a transitional economy. This study also provides empirical evidence and policy implications for optimizing medium- and long-term incentives, improving corporate governance structures, and enhancing innovation efficiency in SOEs.

Keywords

State-owned Enterprises, Employee Restricted Stock Incentives, Equity Incentives, Innovation Efficiency, Marketization Level, CEO Duality

Degree Awarded

SMU-SJTU Doctor of Business Administration

Discipline

Strategic Management Policy

Supervisor(s)

GENG, Xuesong

First Page

1

Last Page

158

Publisher

Singapore Management University

City or Country

Singapore

Copyright Owner and License

Author

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