| After nearly forty years of rapid growth, China's economy has experienced a slowdown in growth in recent years. Analyzing the logic behind China's economic growth, we find that the traditional economic growth mode relying on material resources consumption is not sustainable. Standing on the new starting point, our country must shift to rely on innovation driven economic development mode. Innovation driven economic development, enterprise R&D activities play an important role, so this paper will research and development investment as the object of study. Combined with China's current financial liberalization reform and institutional change, this paper focuses on the relationship between financial development and corporate R&D investment.The introduction part describes the research background, research content and ideas, as well as the innovation and significance of the study. In the second part, the existing literature is reviewed and analyzed. The third part analyzes the relationship between financial development and enterprise R&D investment in theory, and puts forward the hypothesis of this paper. The fourth part in 2005-2007 China's data of industrial enterprises as samples by nonlinear model for empirical analysis confirms this hypothesis: there is a U-shaped relationship between financial development and enterprise development, namely when the financial development level is low, the improvement of the level of financial development will inhibit the enterprise R&D investment, and when the level of financial development over a critical, the improvement of the level of financial development will promote enterprises to increase investment in research and development; at the same time also confirmed the bigger in size, continuous operation for a longer period, profit rate higher, stronger market power enterprises and financial development on business R&D investment promotion effect is more significant. At the end of this paper, the conclusions and policy recommendations are given. |
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