Abstract: After China′s economy enters the new normal, the supply side structural reform is needed, relying on innovation driven to build a new engine of economic growth. From the perspective of social capital, this paper examines the role of informal institutions in technological innovation activities, and takes the regional financial development as an intermediary variable to analyze its role. Empirical studies find that social capital directly affects regional technological innovation, and indirectly affects regional technological innovation by promoting regional financial development; in the areas of weak legal consciousness and property rights protection, social capital plays substitution effect. This conclusion can help people understand the institutional arrangement and cultural factors behind Chinese rapid economic growth. To tap the development potential of social capital, we should create a social atmosphere of honesty and trust, resolve the problem of asymmetric information in financial transactions, and improve property rights protection mechanism to protect the interests of all parties.

Key words: technological innovation, social capital, regional financial development, legal institutions, trust