Proxy-based managerial digital literacy and corporate innovation pathways: evidence from Chinese manufacturing firms

Purpose This study aims to examine how proxy-based managerial digital literacy is associated with firms’ citation-based innovation pathway orientations and how this relationship is conditioned by managers’ structural social network embeddedness. Design/methodology/approach Informed by a dynamic capabilities perspective and the structural perspective of social network embeddedness, this study develops an analytical framework linking proxy-based managerial digital literacy to firms’ citation-based knowledge-source orientations in innovation. Using panel data from A-share listed manufacturing firms in Shanghai and Shenzhen from 2012 to 2023, the authors employ panel regressions with industry and year fixed effects, and propensity score matching to examine the proposed relationships. Findings The results indicate that higher levels of proxy-based managerial digital literacy are positively associated with firms’ engagement in citation-based imitative and independent innovation orientations, as well as their complementary use. Moreover, structural social network embeddedness, proxied by executives’ interlocking board ties, most robustly strengthens the association with citation-based imitative innovation orientation, while the moderating evidence for independent and complementary innovation orientations is positive but marginal. Additional analyses show that the relationships vary across ownership types, firm size and industry technological intensity. Originality/value This study contributes to the literature by providing large-sample empirical evidence on how managers’ proxy-based digital cognitive orientation relates to firms’ citation-based innovation pathway choices under different structural conditions. By focusing on the joint role of proxy-based managerial digital literacy and structural network embeddedness, the findings offer insights for manufacturing firms operating in B2B and industrial market contexts as they coordinate external knowledge sourcing and internal knowledge recombination in the digital economy.