How firm's addressing of the dual-challenges in China's mid-range economy affect innovation performance?

This article investigates how firms' addressing of the challenges from the market and non-market conditions in China's mid-range economy would affect firms' innovation performance. Based on the multiple informant data from 303 firms in China, we find that formal institutional capital/informal institutional capital has an increasingly positive/inverted U-shaped effect on innovation performance. Exploratory market learning strengthens the formal institutional capital/informal institutional capital-innovation performance relations, while exploitative market learning weaken the inverted U-shaped effects informal institutional capital has on innovation performance. [ABSTRACT FROM AUTHOR]