Abstract
Family involvement is one of the important theoretical bases for explaining the innovation investment of family business. This study investigates China’s listed family enterprises and conducts an empirical test on the relationship between family involvement and enterprise R&D intensity. This study mainly draws the following conclusions: First, both family involvement in ownership (FIO) and family involvement in management (FIM) are significantly negatively correlated with R&D intensity, and there is a nonlinear relationship. FIO affects family business R&D investment through control rights, non- financial performance, and risk preference, while FIM exerts influence on corporate innovation decisions through three channels: intergenerational inheritance, social emotional wealth, and family emotion. Second, the degree of industry competition positively moderates the relationship between FIO and R&D intensity, that is, market competition mitigates the negative relationship between FIO and R&D intensity. A high level of competition reduces economic returns to all firms, thereby reducing social- emotional utility. In the face of fierce industry competition, the demand for social emotional wealth preservation will cause family businesses to respond more vigorously than ordinary private companies, which increases the sensitivity of family owners to R&D investment. Thus, family businesses have higher R&D motivation in a market environment with high uncertainty and intense competition. Third, the second-generation involvement and female participation in family businesses have a positive moderating effect on the relationship between FIM and R&D intensity. On one hand, the involvement of the second generation makes family managers have unique patience capital to pursue intergenerational family control, and the successor's need to establish an external trust mechanism also prompts family managers to increase innovation. On the other hand, the risk preference of female managers can alleviate the risk aversion sensitivity of family owners. They are quite forward-looking, starting from the long-term development goals of the family business, focusing on the intergenerational inheritance of the family business, which is conducive to increasing R&D investment.