Research On The Mechanism Of The Impact Of Continuous R&D Investment On The Long-term Value Of Enterprises

Over the years,China’s high-level policy has attached great importance to enterprise R&D investment,from fiscal policy to specific industrial policies and other aspects of support to encourage enterprises to carry out innovative R&D activities.The key for enterprises to maintain an edge in the competitive market is to conduct continuous R&D and innovate continuously.What are the economic consequences of continuous R&D in different life cycles and what are the different impacts on enterprise value? The specific answers to these questions have important microscopic implications for the formulation of relevant R&D support policies and enterprise R&D investment decisions at the top level.Based on this,this paper investigates the impact of continuous R&D investment on the long-term value of enterprises based on enterprise life cycle theory.This study collates and sorts out the current academic literature on corporate R&D investment and corporate value.Numerous studies have shown that there is a significant positive relationship between corporate R&D investment and corporate value.Based on the literature findings and theoretical basis,this study focuses on the mechanism of the impact of continuous R&D investment on the long-term value of listed pharmaceutical companies.Through the empirical study,three main conclusions are drawn.First,the conclusion that continuous R&D investment has a significant positive impact on the long-term value of enterprises suggests that the lagged effect of R&D investment can be adequately balanced from a long-term perspective and has an overall positive impact on the long-term value of enterprises.Among them,the effect is more pronounced in the growth and maturity periods and becomes significantly weaker in the decline period.Secondly,this paper tests the establishment of the mediating variable-market power in the growth stage,indicating that for growth stage firms,the impact of continuous R&D investment on the long-term value of the firm will be more exogenous in the form of market power expansion.Thirdly,this paper also tests that the mediating variable-product cost reduction holds at the maturity stage,suggesting that for maturing firms,the form of impact of continuous R&D investment on the long-term value of the firm will be more focused on endogenous product cost reduction.Overall,the findings of the study also maintain logical correspondence with the traits of firms at different life cycle stages.In addition,this paper is innovative in terms of research perspective and research content.In terms of research perspective,this paper takes into account the lag effect and threshold effect of R&D investment,which makes up for the deficiency that most academic discussions in recent years have been limited to a certain stage of the enterprise in terms of the impact of R&D investment on enterprise value.Secondly,in terms of research content,this study takes into account the characteristics of the research subjects under different life cycles and refines the transmission path of the influence mechanism,which helps to make up for the academic research content in the field of heterogeneity of R&D investment on enterprise value under different life cycles of the same enterprise,and improves the applicability of the research findings.