Abstract:    China′s micro, small and medium-sized enterprises (MSMEs) play an important role in the economic and social development, and its innovative development is the core of MSMEs to achieve high-quality development. However, MSMEs still face the problem of “expensive and difficult financing”, which greatly hinders the innovation and development of them. Patent pledge is a new financing method in China, and it provides a new financing channel for MSMEs. With the gradual expansion of the pilot scope of patent pledge policy, the total amount of patent pledge financing in China has shown a growing trend. Patent pledge financing has become an important financing channel and financing method for MSMEs, and relevant data provide a good research scenario for us to study the impact of patent pledge on enterprise innovation.This paper selected a data set of China′s National Equities Exchange and Quotations (NEEQ) listed companies from 2016 to 2021 as samples, and took the enterprise pledge right exercising as the starting point to empirically study the impact of patent pledge right exercising on enterprise innovation of MSMEs. The results showed that patent pledge has a significant promoting effect on enterprise innovation. The results also showed that patent pledge right exercising can effectively alleviate the financing constraints of enterprises and promote their innovation. The heterogeneity test showed that in high-tech enterprises, non-state-owned enterprises, and enterprises in central and eastern regions, the impact of patent pledge right exercising on enterprise innovation is more significant. Further research showed that patent pledge right exercising can improve the innovation ability of enterprises, and then improve their business performance.Under the background of Chinese-style innovation, it is of great practical significance to explore the mechanism of patent pledge affecting the innovation of MSMEs. The research of this paper has the following three aspects of contribution. First, the existing literature is only based on the pilot areas of patent pledge, but there is no literature from the perspective of patent pledge right exercising to study its impact on the innovation mechanism of MSMEs, which is a useful supplement to the research on patent pledge financing. Second, the paper examined the mechanism, heterogeneity and economic consequences of patent pledge right exercising affecting the innovation of MSMEs, which has certain implications for the further implementation, improvement and promotion of patent pledge policies in China. Third, this paper studied the exercising of patent pledge right and the innovation of MSMEs, and provided suggestions for the formulation of policies for the innovation and development of MSMEs, thus further promoting the realization of Chinese-style innovation goals and promoting the high-quality development of MSMEs.Based on the empirical analysis results, this paper proposed the following implications in formulating policies: first, the implementation of patent pledge policy should be actively promoted throughout China to encourage more MSMEs to pledge patents. The financing scale of patent pledge should be further expanded, and the term of patent pledge right exercising should be extended, so as to improve the implementation level of patent pledge policies. In addition, a special innovation fund should be established to strengthen the credit support of financial institutions for MSMEs, expand the amount of innovation loans for MSMEs, and create a good environment for independent innovation, so as to promote the high-quality development of MSMEs.

Key words: micro-, small- and medium-sized enterprise (MSME), patent pledge right exercising, enterprise innovation, constraint on financing