Abstract:Based on transaction cost, technology innovation and strategy management theory, this paper constructs a theoretical model of relationship between asset specificity, competitive strategy and enterprise technology innovation, empirical tested by the balanced panel data of 243 listed small and medium-sized manufacturing enterprises from 2010 to 2018 in China. The results show that the asset specificity plays a significantSnegative impact on the enterprise"s technology innovation;the asset specificity has a significantSpositive impact on the overall cost leadership strategy, the overall cost leadership strategy has a negative impact on the enterprise"s technology innovation but not significant; the overall cost leadership strategy has a partialSmediating effect on the relationship between asset specificity and technology innovation ; the asset specificity has a significantSnegative impact on the differentiation strategy, the differentiation strategy has a significant positive impact on the enterprise"s technology innovation, the differentiation strategy plays a completely mediating role between asset specificity and the enterprise"s technology