Abstract: As an important innovation subject,enterprises have significant spillover effects of their innovation activities on upstream and downstream in the supply network. In this context,exploring how supply networks affect enterprise innovation and its transmission mechanism has become a key issue in understanding the coordinated development of industries and enhancing overall competitiveness. This not only helps to enrich the theoretical research related to supply networks and enterprise innovation,but also has important practical significance for promoting the high-quality development of Chinas industrial chain and supply chain,and enhancing the overall efficiency of the national innovation system. Although there have been a substantial body of research on the relationship between supply networks and enterprise innovation,there are still certain shortcomings. Firstly,there is relatively little discussion on the innovative impact of joining the supply network itself. Secondly,research mostly focuses on the impact of customers on supplier innovation,with less examination of the influence of suppliers on customer innovation. Thirdly,there is a lack of micro empirical evidence on spillover mechanisms,especially causal empirical evidence. Considering the current situation in China,listed companies are undoubtedly leading enterprises that occupy a core position. Their every move profoundly affects the changes in the entire industrial chain and supply chain. Therefore,studying listed companies is the key to understanding the relationship between supply networks and corporate innovation output. Therefore,this article aims to examine the impact of client companies joining the supply network of listed companies on their innovation level,attempting to answer the following two questions:Can client companies enhance their innovation capabilities after joining the supply network of listed companies? What is the mechanism for enhancing its innovation capability? This article first constructs the supply network of listed companies in China from 2010 to 2022 based on the top five suppliers and customer relationship data disclosed by listed companies. Using the annual supply network of listed companies,the exogenous event of enterprises joining the supply network of listed companies is identified and regarded as a quasi-natural experiment. A multi-time difference in differences model is used to test the causal relationship between customer enterprises joining the supply network of listed companies and their innovation output. Mechanism analysis,heterogeneity analysis,and further analysis are conducted in sequence. The main research conclusions of this article are as follows:Firstly,joining the supply network of listed companies can significantly improve the innovation level of customer enterprises,and this effect still exists after excluding conventional channels such as increased operating income or R&D investment. Secondly,the improvement of customer enterprise innovation capability mainly comes from the technology spillover effect of purchasing products from listed companies,which is achieved through three micro paths:updating machinery and equipment,optimizing material resources,and increasing added value. Thirdly,there is significant heterogeneity in the effects of joining the supply network of listed companies to enhance innovation levels. From the characteristics of the industries in which the enterprises are located,the innovation effect is more significant in asset-intensive industries,industries with high market concentration,and upstream industries in the value chain; From the perspective of the characteristics of the enterprises that have joined the network,the innovation effect of large-scale and state-owned enterprises is more significant; From the perspective of supplier characteristics of networked enterprises,the innovation effect is more significant when the supplier concentration is high and the supplier and networked enterprise industries are the same. Furthermore,the innovation effect of joining the supply network of listed companies is negatively affected by the innovation level of the participating enterprises and positively affected by the innovation level of their suppliers. Compared with existing research,the possible marginal contributions of this article lie in the following three aspects. Firstly,in terms of research perspective,previous studies have mostly focused on the transmission and spillover of innovation activities in the supply network,while this article focuses on the innovation effects brought about by the event of “joining the supply network of listed companies” itself. Secondly,in terms of causal identification,most existing studies have used bidirectional fixed effects models to test the innovation correlation between enterprises in the supply network. This article attempts to construct and identify the supply network,and provides empirical evidence of the causal relationship between adding the supply network and enterprise innovation. Thirdly,at the level of mechanism explanation,this article enriches the micro mechanisms of technology spillover in supply networks through empirical research based on enterprise-level data. Previous studies on the mechanism analysis of supply network innovation have mostly focused on dimensions such as increasing R&D investment and alleviating financing constraints. However,the results of this study indicate that customer enterprises can improve their innovation level by enjoying technology spillover through purchasing high-quality products.