Abstract:   Specialized, refined, distinctive and innovative "Little Giant" enterprises (SRDI "Little Giants") are an important force in the national innovation-driven development strategy, but the existing micro-research on the innovation effect of the recognition policy of SRDI "Little Giants" is not deep enough. For this reason, this paper selected the SMEs listed in 2015-2021 and the national SRDI "Little Giants" recognized during this period as the research samples, and adopted the DID method to examine the impact of the recognition policy on the innovation quality and innovation efficiency of enterprises and the influence mechanism. It was found that the policy of recognizing SRDI "Little Giants" can significantly improve the innovation quality and innovation efficiency of enterprises, and this conclusion still holds after a series of robustness tests. It was further found that the recognition policy improves firms' innovation quality and efficiency mainly through alleviating financing constraints, improving human capital acquisition and facilitating digital transformation. At the same time, the effect of the recognition policy on innovation quality and efficiency of SRDI "Little Giants" is more significant in the second batch of selected enterprises, those applying the financial subsidy support means, and those in the maturity and decline periods. This paper has provided intuitive and powerful evidence for the effectiveness of the policy of recognizing SRDI "Little Giants", which will have important theoretical and practical value for better assisting the cultivation of SRDI "Little Giants".

Key words: specialized, refined, distinctive and innovative "Little Giant" enterprise, innovation quality, innovation efficiency, digital transformation