How Does Artificial Intelligence Application Enable Sustainable Breakthrough Innovation? Evidence from Chinese Enterprises

As the core driving force of the new generation of industrial revolution, artificial intelligence technology has brought new opportunities for empowering enterprise innovation and advancing sustainability. Focusing on Chinese A-share listed enterprises and based on the unbalanced panel data from 2011 to 2023, this study systematically examines the relationship mechanism between artificial intelligence (AI) application and enterprise breakthrough innovation, and further explores the mediating effect of knowledge recombination and the moderating role of market competition. The empirical results show that AI application has a significant promoting effect on the enterprise breakthrough innovation. Knowledge recombination creation and knowledge recombination reuse play mediating roles in the relationship between the AI application and enterprise breakthrough innovation, forming the key transmission path for empowering breakthrough innovation with AI. In addition, market competition positively moderates the relationship between knowledge recombination and enterprise breakthrough innovation and strengthens the driving effect of knowledge recombination on innovation output, thus fostering more sustainable competitive advantages.