Research On The Backward Advantage Of The Efficiecy Promoting Based On The Government R&D Investment Of China

According to Solow's study, the technological innovation, instead of the accumulation speed of elements, is the main reason for the economic growth. Many studies have shown that reproduction cost of technological innovation is rather low, compared to the high R & D costs, resulting in the external economy. In the condition of technical overflow, relying only on market forces cannot produce adequate incentives for innovation. To strengthen the government's input in the technological innovation has become the consensus of all countries in the world. Therefore, how to strengthen the input in technological innovation has become an urgent research subject. As an eastern power with a great literary talent, China is in the period of economic transition. The government's input in technological innovation exerts great externality, bringing about a social rate of return which is much higher than the personal rate of return. As a result, the efficiency of the government's R & D input is decisive for the performance of the backward advantage.The study of this paper revealed that the developed countries set a hi-tech transfer barrier for China. In the hi-tech industry, it is found that the technology introduction costs are negatively correlated with the sales revenue of their new products. The government's R & D input is urgently needed to change the situation. The study in International Trade Theory holds the view that the government's R & D input will help to stimulate the national R & D activities (Helpman,1984), to narrow the technological gap and to change the disadvantageous situation of the backward countries in the international trade activities. Eventually, the countries would rank among the world's leading technological countries.Since the end of last century, China has intensified its R & D investment. The government's R & D input has seen a corresponding increase. However, a series of indexes shows that the R & D input efficiency of is not satisfactory, hampering the full play of the backward advantages. The author found through empirical analysis that in the hi-tech industry, the R & D input efficiency of the domestic-funded enterprises (including the government's R & D input) is much lower than that of the foreign-funded enterprises. One of the reasons for the government's low input efficiency is the dual effect, namely, the "causing effect" and the "crowding-out effect". The government's R & D input in the domestic-funded enterprises exerts "causing effect" on their R & D input. However, it in some degrees has a "crowding-out effect" on the R & D input of the enterprises which are sensitive to the market demand. The industrial differences this paper uncovers could provide beneficial ideas for the government's selective R & D input and the improvement of its input efficiency.Further analysis showed that the dynamic changes of the market demand also affects the government's R & D input efficiency significantly in the following-up process. The key in increasing the R & D input efficiency is to reduce the degree of information asymmetry in market demand. The government's selective input helps to improve the situation.Based on the studies above, the author further analyzed the channels and the mechanism of the government's selective R & D input. The first channel is the selective input based of the industrial differences. For industries and products which are generally concerned, widely spread, and have a great strategic significance for the welfare of the country and the people, the input should be increased due to the great market potential and low degree of information asymmetry in the catching up process. The second one is the selective input based on the entrepreneurs'innovative abilities. As a special human resource, the business sense, market intuition and opportunity capturing ability help to reduce the information asymmetry and the faulty R & D input, adapting the government's R & D input to the dynamic changes of the market demand. For this reason, the government needs to create a favorable economic environment in order to fully activate and enhance the various innovative abilities of entrepreneurs, thus improving the R & D input efficiency of the government. The third selective input is targeted at the R & D of general technology. Because of the high positive externality, definite research subjects and clear market demand information of cluster economy, government's input in this field will defuse the unique "Prisoner's Dilemma" in the cluster's technological innovation, immensely increasing the input efficiency. The channels above are reasonable because they effectively reduce the information asymmetry in the process of the government's R & D input, increase the input efficiency and give the backward advantages into full play.