This study aims to investigate the relationship between entrepreneurship and innovation efficiency (IE), as well as the moderating role of absorptive capacity.
This study uses a sample of industrial enterprises from Chinese provinces from 2005 to 2016, and it tests the research questions using the method of stochastic frontier analysis.
The results of this study indicate that entrepreneurship promotes IE, and that absorptive capacity plays a positive moderating role. In addition, the effect of entrepreneurship on IE differs between the central and eastern regions and the western region.
This research provides direct policy implications by demonstrating the role of entrepreneurship and absorptive capacity in IE, thereby guiding corporate management practices and the formulation of government innovation and entrepreneurship policies.
