The Relationship Between R&D Investment And Enterprise Performance Based On Life Cycle:the Regulatory Role Of Executive Incentive

How to motivate the independent innovation of enterprises effectively is an important problem in Chinese industrial upgrading.Through R&D innovation,enterprises can gain market advantage and continuous development power.So it is very important to establish a reasonable equity and salary incentive policy to encourage the executives to increase their R&D investment,it is beneficial to promote the long-term development of the enterprises.In 2009,Growth Enterprise Market is established in China,which accounted for 95% of the high-tech enterprises and 74% of the strategic innovation enterprises.It is the main body of technological innovation in the stage of economic transformation in China.According to the research in R&D investment,executive incentives and corporate performance on Chinese GEM,we can provide references for GEM listed companies to build effective executive incentive system to improve their R&D intentions and attain more R&D result.There are many articles about the relationship between R&D investment and business performance,and the academic community has confirmed the positive relationship between them,but there are few studies on the relationship between different stages of life cycle.The academic circle has also done a lot of research on the relationship between executive incentive and enterprise performance,but the research on the impact of the interaction between R&D investment and executive incentive interaction on enterprise performance is scarce.Is there any difference in the impact of the interaction on enterprise performance in different life cycles? It is also the innovation of this study.The article choose the 374 companies who disclosure both R&D investment and executive shareholding data based on Chinese GEM as research samples,with 2014-2016 years as the research object.The article respectively research the relationship between R&D investment and enterprise performance,the relationship between executives incentive and enterprise performance and the regulatory effect of executive incentive on R&D investment and enterprise performance.The paper makes a detailed analysis and comparison of several life cycle division methods used by academic circles,and finally chooses Dickinson cash flow combination method to divide sample enterprise into growth period,mature period and recession period.So we can research the difference on the relationship among three variables in different life cycle of enterprises.The results of this study show that:(1)R&D investment has a significant positive correlation with enterprise performance.But in the recession period,there is no significant positive relationship between R&D investment and enterprise performance.(2)Both executive equity incentive and executive salary incentive can promote enterprise performance.But in the specific life cycle,the promoting role is verified in the growth period.In the mature and recession period,the promoting role is not obvious;(3)the regulatory role of executive equity incentive between R&D investment and enterprise performance is not significant,and there is no regulatory role in all life cycle period;(4)the regulatory role of executive salary incentive is obvious.From the specific life cycle,in the growth period of the enterprise,the executive salary incentive can adjust the R&D investment and the enterprise performance.But in the mature and recession period,the adjustment of executive compensation is not significant.