We examine the relationship between firms' political connections and corporate innovation in a European context. We also consider the moderating effect of political connections on the relationship between political uncertainty and firms' innovation. We use two different metrics of innovation: R&D (an input measure), and patent counts (an output measure). We find that firms with former politicians on their board of directors invest less in R&D than their counterpart firms. However, the presence of this type of director on the board is positively associated with the number of a firm's patent applications. It seems that, although political ties reduce the amount of resources devoted to R&D activities, they increase the effectiveness of intellectual rights protection. Results also show that political uncertainty decreases R&D investment but exacerbates the need for legal protection of innovation through patents. According to our results, political connections attenuate the effect of political uncertainty on firm innovation such that the negative (positive) effect of uncertainty on R&D intensity (patents) weakens when the firm is politically connected.

中文翻译：

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政治关系和政治不确定性在企业创新中的作用


我们研究了欧洲背景下企业的政治关系与企业创新之间的关系。我们还考虑了政治联系对政治不确定性与企业创新之间关系的调节作用。我们使用两种不同的创新指标：研发（投入指标）和专利数量（产出指标）。我们发现，董事会中有前政客的公司在研发方面的投资少于同行公司。然而，董事会中此类董事的存在与公司的专利申请数量呈正相关。看来，虽然政治关系减少了研发活动的资源投入，但却提高了知识产权保护的有效性。结果还表明，政治不确定性会减少研发投资，但会加剧通过专利对创新进行法律保护的需求。根据我们的结果，政治联系减弱了政治不确定性对企业创新的影响，因此当企业有政治联系时，不确定性对研发强度（专利）的负面（正面）影响减弱。