Financing Capacity,Government Subsidies And R&D Investment

The report of the 19 th National Congress pointed out that innovation is the first driving force for development.However,due to insufficient R&D and innovation,the products of Chinese enterprises lack international competitiveness.Therefore,increasing investment in R&D has become a top priority for implementing innovation-driven development strategies.Financing capacity,as an effective reflection of the scale of funds that an enterprise can finance,can provide financial support for enterprise R&D activities.According to existing literature,the financing capabilities of different sources have heterogeneity in the role of corporate R&D investment.In addition,the development of enterprise R&D activities will also be encouraged and induced by government subsidies,but the theoretical circles have endless debates on its "incentive effect" and "squeeze effect".Based on this,this paper studies the effect of financing capacity,government subsidies on enterprise R&D investment,and the interaction mechanism between the two,aiming to solve the following questions: How does financing capacity and government subsidies affect the R&D investment of enterprises under the Chinese scenario? Are the two effects independent of each other's R&D investment or are there interactions? Will the interaction between the two be different under different property rights? On the basis of investigating the overall financing capabilities of enterprises,are there significant differences in the role of financing capabilities of different sources in the R&D investment of enterprises?To explore the above issues,this paper selects the empirical data of Chinese A-share listed companies from 2009 to 2018,explore the impact of financing capabilities,government grants,and the interaction between the two on corporate R&D investment.To further analyze the differential performance under different property rights,and the role of different sources of financing capacity in the R&D investment of enterprises.First of all,combing the domestic and foreign literature on the research theme,it is found that the research on the relationship between financing capacity,government subsidies and R&D investment has not reached a consistent conclusion,and more theoretical support is still needed to verify the necessity of the research issues in this article;Secondly,elaborate on technology innovation theory,information asymmetry theory,financing priority order theory and signal transmission theory,and analyze relevant institutional background;Third,in-depth exploration of the financing capacity,government subsidies and the interaction between the two on the R&D investment path,pointing out the difference in performancecaused by the nature of property rights,on this basis,put forward research hypotheses;Fourth,conduct descriptive statistics on the research samples,and verify the hypothesis in this paper through correlation analysis and regression analysis;Further,based on the channel perspective,this paper divides the enterprise's financing ability into endogenous financing ability,debt financing ability and equity financing ability,and empirically analyzes the differences in the effects of different sources of financing ability on enterprise R&D investment;Finally,draw conclusions through empirical analysis,and make targeted policy recommendations based on the conclusions.The study found that,financing capacity and government subsidies are positively correlated with corporate R&D investment.Under certain conditions of financing ability,government subsidies can strengthen the incentive effect of financing ability on enterprise R&D investment.Examining the impact of the nature of property rights,it is found that,the strengthening effect of government subsidies on the relationship between financing capacity and R&D investment is more significant in non-state-owned enterprises.After further refinement of financing capacity,it was found that both endogenous financing capacity and equity financing capacity have a promoting effect on corporate R&D investment,and debt financing capacity has a significant inhibitory effect on corporate R&D investment.The conclusion of the study provides a reference for enterprises to improve their financing capabilities,rationally choose financing channels,and the government's efforts to increase financial subsidies and improve the financial subsidy mechanism.