Data factor marketization, innovation effect and R&D manipulation: evidence from the construction of data trading platforms in China

Data factor marketization significantly influences firms’ innovation behaviour. Data trading platforms are used as a quasi-natural experiment to examine data from Chinese listed corporations from 2011 to 2021. A Difference-in-Differences (DID) model is employed to investigate the impact of data marketization on firms’ R&D manipulation behaviours and to assess its effect on innovation. The results indicate that data factor marketization enhances firms’ innovation capacity, thereby reducing R&D manipulation, with a pronounced effect observed in firms within the digital sector and in high-credit cities. This innovation effect, primarily driven by firm-led and commercially-oriented data trading platforms, increases the overall volume of firms’ innovations but diminishes their quality. However, for small-scale firms that do not invest enough in R&D, data marketization rather enhances their R&D manipulation. These findings offer valuable insights for revolutionizing data factor marketization and the strategic implementation of innovation-focused industrial policies.