An Empirical Study On Government Subsidies,R&D Investment And Enterprise Performance

Growth Enterprises Market (GEM), providing services to Small and Medium Enterprises (SMES) which are small scale, creating in short time, but with high potential for growth, is an important position of Chinese technical innovation front. GEM companies have always been known for their strong sense of innovation and flexible operating system, and the research and development (R&D) capacity is an important part that cannot be ignored. Because of the spillover effect of R&D investment, the financing difficulties of SMES and other factors, government subsidies in the role of technological innovation attracts our attention. But from former research results, the affection relationship between government subsidies and corporate performance has not yet conclusive. For the past many scholars pay more attention on the relationship between two factors of the three ones:government subsidies, corporate R&D investment and corporate performance, while less scholars research on the relationship among the three ones. Almost no scholar empirical verifies the role of corporate R&D investment plays in the relationship of three ones. And few scholars, using the companies listed on the GEM as the object of study, research whether high-tech enterprises, compared to the non-tech ones, have significant advantages in the use of government subsidies. All these issues need to be verified.This paper uses the method of combination of theoretical analysis and empirical research to study the topic. First of all, this paper expounds theories of the technology innovation, signal and agency; secondly, reviews and comments domestic and foreign literature in three aspects as follows:the government subsidies influencing enterprise performance, government subsidies impacting on corporate performance, and enterprise R&D investment impacting on corporate performance. Again, analyzes these aspects from theory, and further discusses the intermediary role of enterprise R&D investment in the influence of government subsidies and enterprise performance. At the same time, the paper verifies whether high-tech enterprises promote or inhibit the relationships of above three aspects. Finally, the paper chooses 361 companies listed in the GEM from 2010 to 2013 as empirical samples, divided to two groups by whether a company is high-tech, using OLS multiple linear regression method to verify above relationships.Main conclusions from the study are as follows:First, government subsidies and corporate performance have a significant positive relation, and there is a lag of more than two years; government subsidies impact on business performance mainly through indirect means, that is, government subsides providing enterprises an incentives to promote technological innovation capability that improving company productivity and competitiveness in market then ultimately promoting the growth of corporate performance; high-tech enterprises can significantly promote the positive relation between government subsidies and enterprises long-term performance. Second, government subsidies can significantly enhance the company's R&D investment, but there is a year lag; however, the high-tech enterprises significantly inhibit this promotion relationship, that is, the government subsidies produce a substitution effect to enterprises R&D investment, in high-tech enterprises. Third, there is a significant positive relationship between corporate R&D investment and company performance, and no lag, illustrating that the process of technological innovation market is fast in companies of GEM; high-tech enterprises significantly promote a positive relationship between enterprise R&D investment and company's performance. Fourth, enterprise R&D investment plays a role of intermediary effect in the relation between government subsidies and corporate performance; compared to non-high-tech enterprises, the mediating effect of R&D investment is more significant in high-tech enterprise. Based on above conclusions, this paper puts forward relevant some relevant suggestions from two aspects of enterprise management and government subsidies supervision respectively.