The Impact Of Government Subsidies On R&D Investment And Operating Performance

Since entering the 21st century,China has achieved world-renowned achievements.Not only has its economy reached a new level,but its international status and influence have also made considerable progress.With the rapid development of economy,the national leadership has foresight and put forward the goal of economic structural transformation and the concept of green development.The environmental protection industry which has the dual characteristics of the public welfare of ecological environment protection and the new engine of economic development has entered a new era of rapid development.The role of orbits in stimulating economic growth has become more and more obvious.As an industry with obvious positive externalities,the environmental protection industry has received strong support from the country and government.The environmental protection industry has made considerable progress under the dual promotion of industry policies and governmental funds.As the number of subsidies continue to increase,the drawbacks and problems of governmental subsidies in the field of environmental protection have become increasingly apparent.Based on this condition,this thesis takes the study of the efficiency of the current governmental subsidies for environmental protection industry as a starting point,and deeply explores the effects and existing problems of environmental protection subsidies.After sorting out relevant research literature at home and abroad,this thesis summarizes some traditional economic theories involving government subsidies and subsidy transmission mechanisms.After that,it deeply analyzed the development status and subsidies of environmentally-listed companies,and conducted empirical research based on relevant data of environmentally-listed companies.The empirical analysis mainly puts forward three hypotheses:(1)governmental subsidies promote the increase of enterprises’ R&D investment;(2)governmental subsidies encourage enterprises to improve their operating performance;(3)governmental subsidies have a negative regulating effect on the effect of R&D investment.Based on the above assumptions,this thesis also makes further study on the influence of the nature of property rights,geographical distribution,and business sectors.The research conclusions of this thesis are as follows:(1)Governmental subsidies and the investment of R&D have a positive correlation,and there is a positive correlation between nationalized enterprises and non-nationalized enterprises;(2)The role of governmental subsidies in promoting the investment of R&D is different in terms of regions and sectors.The effect of the eastern region is more significant than that of the non-eastern region,and the effect of subsidies for technology companies are more significant than that for service companies;(3)governmental subsidies promote the improvement of business performance of enterprises,in addition,governmental subsidies have a lagging effect;(4)governmental subsidies have a negative effect on R&D investment.The subsidy partly has squeezed out the original R&D scale of enterprises,and the effect of extrusion in non-nationalized enterprises is stronger than that in nationalized enterprises.In view of the above research results,this thesis puts forward the following suggestions:(1)Establish a special subsidy system of environmental protection industry;(2)Improve the implementation of subsidies based on the characteristics of multiple subsidy ways;(3)Establish and improve the financial mechanism of environmental protection industry and expand the access of financing methods for environmental protection company.