Abstract: The innovation decision during intergenerational succession is critical to the long-term survival and development of family business. Based on the perspectives of providing heterogeneous knowledge for the adjustment of innovation decisions and enhancing the legitimate authority of successors, this study uses the samples of Chinese listed family businesses that completed succession from 2010 to 2022, and reveals the differentiated dynamic phased impact of intergenerational entrepreneurship on innovation decisions of family firms (before and after involving in management, as well as before and after receiving management). It is found that, as the intergenerational succession process evolves, intergenerational entrepreneurship exerts an increasingly pronounced influence on the adjustment of innovation decisions within family firms, implying a marked escalation in high-risk exploratory innovation. For family firms with high environmental uncertainty, heavy assets, large scale and high-tech, intergenerational entrepreneurship have a significant continuous positive impact on their exploratory innovation after receiving management. Further research shows that the second generation that engaged in intergenerational entrepreneurship relies more on the establishment and consolidation of their own authority to promote the adjustment of innovation decisions, rather than the help of their parents, and can guide the resources flow to exploratory innovation more effectively after succession, shaping long-term competitive advantages for the resource-scarce family firms. The study conclusions can provide theoretical enlightenment and practical guidance for the realization of cross-generational growth of family firms in the process of power handover.

Key words: intergenerational entrepreneurship, intergenerational succession, exploratory innovation, exploitative innovation, family business