Research On The Effect Of China’s Government R&D Subsidy Policies

With the implementation of supply-side reform and innovation-driven strategy,China’s economic structure undergoes the transition period.Technological innovation has become the main engine of economic growth,while technological innovation can’t be separated from corporate R&D activities.With the increase of Chinese R&D investment and innovation index,our country has entered the R&D investments’ world power,however compared with the developed countries,Chinese R&D intensity is still in the middle and lower level,total factor productivity has not been improved.In order to find the effect of R&D subsidy policy,based on the domestic and foreign research,this paper analyzes the theory of resource allocation,the concept of efficiency of political association and rent-seeking and the application of R&D subsidy policy effect in international tax competition.On the basis of this,three hypotheses has been put forward: the influence of the two policies on the corporate R&D activities,the influence of the difference of the two subsidy policies on the corporate R&D activities,the regulatory effect of political association and the institutional environment in the implementation of the government subsidy policy.Then use multiple regression analysis and propensity score matching method to test the above hypotheses,the main conclusions are:(1)direct subsidies and preferential tax policy has obvious "motivation effect" on R&D investment,meanwhile direct subsidies have negative effects on R&D output and incentives have positive effects on it;(2)direct subsidies and corporate R&D investment follows an inverted “U” shaped relationship,and the current implementation results is in the left side of the inverted “U” shape line;tax incentives and R&D investment follows an “U” shaped relationship,and the current implementation effect is in the right side of the “U” shape line;(3)while enterprises enjoying both direct subsidies and tax incentives,there is a significant R&D investment difference between “low intensity subsidized” and “medium intensity subsidized” enterprises,but there was no significant difference in R&D output;“low intensity subsidized” and “high intensity subsidized” enterprises showed significant difference in both R&D input and output;“medium intensity subsidized” and “high intensity subsidized” enterprises showed no significant difference in both R&D input and output(4)the policy connection plays a negative regulatory role for R&D investment,the institutional environment plays a positive regulatory role for R&D investment;as for R&D output,political connection has a negative regulatory role in direct subsidy.Finally,the robustness test is performed on the dependent variable--capital return,which verifies the test result.Finally,based on the above research conclusions,this paper puts forward four suggestions,in order to enhance the performance of R&D subsidy policy.