Research On The Influence Of Financial Constraints On The Listed Companies’R&D Investment And R&D Efficiency

The successful investment strategy for R&D (research and development) not only ishelpful to enhance the core competitiveness of companies, but also is the source to obtainsustainable competitive advantage. However, in the technology innovation Chinese companiesare still inadequate in R&D investment and low in R&D efficiency. R&D investment andR&D efficiency of companies are affected by many factors, but finance is one of the keyfactors.This study attempts to explore the lack of companies’ R&D investment and low R&Defficiency from the perspective of financial constraints.Firstly, this study reviews the theories of financial constraints and R&D investment, andoverviews factors influencing R&D investment and R&D efficiency. Then, it analyzes theconditions of Chinese general and companies’ R&D investment and the financial status ofcompanies’ R&D investment.Secondly, based on the existing research results, through theconstruction of listed companies’ financial constraint index system, it uses Logistic regressionand Multivariate discriminant analysis method to determine the composite index of financialconstraints--the LFC index and DFC index about162Chinese listed companies, whichcontinuously disclosure R&D investment information from2007to2012. Once again, usingthe above financial constraints index, this study carries out the following empirical tests:(1)examining the effect of financial constraints on listed companies’ R&D investment; at thesame time, attaching cash holding variable in the empirical model, to test the cash holdingbehavior whether to alleviate the listed companies’ R&D investment effected by financialconstraints.(2) using the DEA-Malmquist to measure R&D efficiency value of the listedcompanies, and testing the impact of financial constraints on listed companies’R&D efficiency.Finally, it generalizes the conclusions of this study, and puts forward proposals. This study draws the following conclusions:(1)Chinese listed companies face financialconstraints which seriously restrict the R&D investment.(2)Cash holdings have relief the effectof financial constraints on R&D investment for the higher financial constraints group.(3)R&D efficiency of Chinese listed companies is not high, and financial constraints index has asignificant positive effect on R&D efficiency. Listed companies with the higher financialconstraints index pay more attention to improve the R&D efficiency.This study collects the Chinese listed companies’ R&D investment and R&D staff inputinformation from2007to2012, establishes the listed companies’ R&D database, and providesa foundation for the future study. Cash holdings have a dynamic effect on the companies’R&D investment; After the remission of financial constraints, the companies’ R&D efficiencyshould have a variation tendency. These depend on further study.