The more valuable the knowledge, the more focused the enterprises: Intellectual property pledge financing and diversification in high-tech enterprises

This paper investigates the relationship between intellectual property pledge financing (IPPF) and enterprise diversification, utilizing data from a large sample of high-tech enterprises. The results demonstrate that IPPF reduces enterprise diversification, leading enterprises to be more focused on their core business. The potential mechanism through which IPPF reduces diversification involves alleviating financing constraints and enhancing firms' capacity for risk-taking. Heterogeneity analysis reveals that in areas with a lower degree of marketization, IPPF exhibits a more pronounced effect in reducing corporate diversification. Similarly, for firms with lower technological innovation capabilities, the reduction in diversification is more pronounced.