Over the past decade, artificial intelligence (AI) has been increasingly used in firm innovation. While AI has contributed to innovation improvement, direct evidence of its effectiveness in radical innovation is limited. This study fills this gap by empirically investigating the impact of AI on radical innovation and how this relationship is shaped by digital foundation and government subsidy from the perspectives of technological synergy and the external institutional environment. Using panel data from Chinese A-share listed firms from 2007 to 2023, this study empirically tests hypotheses thr...
