Study On Institution Environment And Its Alternative Mechanisms, Debt And Chinese Enterprise R&D Investment

The institutional environment has important influence on enterprise R&D investment, however, there are only a few direct empirical evidence on the relation between the institutional environment and its alternative mechanisms and enterprise R&D investment and its internal components at present. One purpose of this paper is thus to provide direct empirical evidence on the influence of institutional environment on enterprise R&D investment and its internal components. Another purpose of this paper is to investigate the relation between the alternative mechanisms of the imperfect institution and enterprise R&D investment and its internal components, and provide the corresponding empirical evidence.Using the sample of Chinese listed firms during 2004~2009, we examine the effect of debt on enterprise R&D investment and its internal components. We find that Chinese enterprises R&D investment intensity has significant negative correlation with debt. As to the structure of enterprise R&D investment, we find that research investment(R) is more sensitive on debt than development investment(D).Taking government intervention as a study point, we examine the difference of R&D investment for the firms with different property in the imperfect institution environment. We find that R&D investment intensity of private enterprise is higher than that of state-owned enterprise, R&D investment intensity of local state-owned enterprise than that of center state-owned enterprise; The marketization level has mainly influence on R&D investment of private enterprises, and government intervention has mainly effect on R&D investment of state-owned enterprises, especially on that of state-owned enterprise; The government suppor has the biggest influence on the R&D investment of local state-owned enterprises, and center state-owned enterprises and private enterprises are also affected by the government support; as to the finance restraint of debt on R&D investment, that of private enterprises is higher than that of state-owned enterprises, and that of center state-owned enterprises is the lowest; center state-owned enterprises has the largest research investments (R) intensity , the second largest is that of local state-owned enterprises, and that of private enterprises is the least; the sequence(from big to small) of the influence degree of government intervention to enterprise research investments (R) is local state-owned enterprises, private enterprises, center state-owned enterprises; the sequence(from big to small) of the influence degree of government support to enterprise research investments (R) is is local state-owned enterprises, center state-owned enterprises, private enterprises.Using the sample of Chinese private listed firms during 2004~2009, we examine the influence of political-connection on R&D investment of private firms. We find that political-connection could enhance R&D investment of private firms, and political-connection with local government has more effect on R&D investment of private firms than political-connection with center government; political-connection has more effect on research investment(R) of private firms than development investment(D); political-connection has more effect on research investment(R) of private firms in the area of bad institution environment than in the area of good institution environment. Bank loan and government support are effective channel for political-connection to affect research investment(R) of private firms. Because of the difference of risk and using limitation, bank loan and government have difference effect on the different components of research investment(R) of private firms. Bank loans have more effects on the restraint for debt on development investment (D) than the effects on the restraint for debt on research investment (R), and the government support have little different effects on the restraint for debt on development investment (D) and research investment (R).