The Influence Of R&D Investment On Corporate Finance

At present, our country is in the key period of economic transition. Deepening the implementation of innovation driven strategy to promote economic transformation and upgrading has become the consensus of the whole society. Under the policy guidance, the main position of enterprise innovation is more consolidated and enterprise R&D investment strength is increasing. R&D investment and financing activities, as the two basic activities in the field of corporate finance, has a close relationship. Based on the data of 435 companies in China's high-tech industry and 800 in traditional industries from 2010 to 2014, and using a multivariate regression model and binary logistic regression model, this paper examines the relationship between R&D investment and external financial choices. The empirical results are as follows:Firstly, different from the traditional industries, a nonlinear relationship between debt financing and R&D investment in high-tech industry is found. Under the joint action of the threshold effect and intensity effect, when the enterprise R&D intensity is less than 3%, high-tech firms that report positive but low R&D use more debt finance than high-tech firms that report no R&D, but when the enterprise R&D intensity is higher than 3%, the use of debt finance falls with R&D intensity among those firms that report R&D.Second, the same as traditional industries, enterprises and the possibility of issuing shares has a positive relation with R&D intensity in high-tech industry:compared with enterprises not spending on research and development, enterprises with R&D expenditures are more likely to issue new shares to finance, and the possibility of issuing new shares will increase with R&D intensity.In this paper, the companies in high-tech industry are the main study object. Analyzing the impact of R&D investment on enterprise financing is theoretically and practically vital, as it not only demonstrates the applicability of Western pecking order theory in China high-tech industry, but also supplements and improves the relevant economic theory. The analysis of empirical research results can help Chinese enterprises and government deeply understand the impact of R&D investment on external financing. Enterprises' financing decisions for R&D investment project should be in line with the characteristics of R&D investment and government should formulate relevant policies to improve the capital market, and promote the sound mechanism of corporate finance.