| Whether or not to survive in the market is the primary problem that business managers face.However,Chinese firms have been living for a short time,and extending the life span of firms has become a core topic of managers.Also,Firm survival plays a crucial role in promoting economic growth,stabilizing the job market and increasing social welfare.In order to improve firm survival,the government will use a series of supportive policies to encourage firm's investment and operation and government subsidies is one of the most commonly used policy instruments.In recent years,the scope and amount of government subsidies have been increasing.However,the phenomenon of“subsidy seeking” and “subsidy dependence” is widespread and the actual incentive effect of government subsidies on firm survival is still controversial in practice.Based on the above background,many scholars have begun to pay close attention to the micro-economic effects of government subsidies,while few studies have evaluated the incentive effects of government subsidies from the perspective of firm survival.The research on the relationship between government subsidies and firm survival is still in an exploratory stage.There are some shortcomings in the research methods and contents,and a relatively complete research framework has not yet been formed.For the above-mentioned research background,using a micro data of industrial firms in China which are newly established during 1998 to 2011 and propensity score matching and event history analysis,this paper carries out the subject of government subsidies,heterogeneity and firm survival based on literature review and mechanism analysis.First of all,we use the data extracted by propensity score matching method to test the effect of government subsidy on firm survival and answer the question whether government subsidy has leverage in firm survival.Secondly,we employ generalized propensity score matching method to evaluate the effect of government subsidy intensity on firm survival,and answer the question whether government subsidy has moderate interval and whether different firms have the same moderate interval.Finally,we adopt propensity score matching and event history analysis to explore firm heterogeneity(firm innovation,property rights),industrial heterogeneity(industrial monopoly,technology intensity),regional heterogeneity(regional corruption,regional marketization)and macroeconomic heterogeneity(macroeconomic development and economic policy uncertainty)on the relationship between government subsidies and firm survival,and answer the question whether there are differences in heterogeneous situations.This research has a certain innovation,i.e.providing new perspectives and ideas for existing research,expanding the existing research methods,enriching the research situations and contents of related literature,and forming a relatively complete theoretical analysis framework.Main findings are as follows.Firstly,government subsidy behavior has a positive impact on firm survival,and subsidized firms have 11.0%-22.1% higher probability of survival than non-subsidized firms.There is S-shaped relationship between government subsidy intensity and firm survival,i.e.it has a “threshold interval”,a “moderate interval”and a “saturation interval”.As government subsidy intensity under 7% and above 15%,it cannot play a successful role in promoting firm survival.Therefore,the government should adhere to the principle of “moderate subsidies” and give full play to the leverage of government subsidies.Secondly,the impact of government subsidy on firm survival differs among heterogeneous firms.On the one hand,government department gives more subsidy opportunities to highly innovative firms,and firms can significantly improve their survival probability by increasing innovative intensity,while firm innovation does not obviously strengthen the incentive function of government subsidies to firm survival.On the other hand,state-owned firms are more likely to receive government subsidy than non state-owned firms,and state-owned firms have a longer life span than non state-owned firms.Also,government subsidy is an important factor in maintaining long-term market survival of state-owned firms.Therefore,the government should increase the subsidies of scientific and technological innovation,establish a supervision mechanism of innovative subsidies,reduce the subsidies of state-owned firms,and eliminate the “zombie enterprises” with low productivity.Thirdly,the impact of government subsidy on firm survival differs among heterogeneous industries.On the one hand,high monopoly industries get more subsidy opportunities than low monopoly industries,but the survival probability of high monopoly industries is relatively lower than low monopoly industries.Also,the promotion of government subsidy to survival probability is more significant in low monopoly industries.On the other hand,government department gives more subsidy opportunities to high-tech industries and firm survival in high-tech industries is better than low-tech industries.Also,the promotion of government subsidy to survival probability is more significant in high-tech industries than low-tech industries.Therefore,the government should optimize industrial market structure,weaken subsidy resource mismatch caused by industry monopoly,support the development of high-tech industries,and accelerate industrial transformation and upgrading.Fourthly,the impact of government subsidy on firm survival differs among heterogeneous regions.On the one hand,low corruption regions get more subsidy opportunities than high corruption regions and the survival probability of low corruption regions is relatively higher than high corruption regions.Also,government subsidies are more motivated to firms in low corruption regions than high corruption regions.On the other hand,government department gives more subsidy opportunities to high market regions than low market regions and firm survival in high market regions is better than low market regions.Also,the promotion of government subsidy to survival probability is more significant in high market regions than low market regions.As a result,government department should create a superior institutional environment and enhance the utilization efficiency of government subsidy resources.Fifthly,the impact of government subsidy on firm survival differs among heterogeneous macroeconomic periods.On the one hand,government department provides more subsidy resources to firms during economic recession,but the survival rate of firms in the periods of high economic growth is obviously higher than low economic growth periods.Also,the promotion of government subsidy to survival probability is more significant in high economic growth periods.On the other hand,government department tends to allocate more subsidy resources to firms during periods of frequent economic policy adjustment and the survival rate of firms during high economic policy uncertainty is obviously higher than low economic policy uncertainty.Also,the promotion of government subsidy to survival probability is more significant in high economic policy uncertainty.Therefore,government department should maintain a good macroeconomic operation form and increase the confidence of firms to continue operation. |
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