Government Subsidy Policy And The Technical Innovation Incentive Of Listed Companies

As an important endogenous force to promote economic growth(Romer,1990),enterprise technological innovation has a strong Non-Exclusive(Externality)characteristics(Arrow,1962).However,this externality inevitably leads to "market failure" problems such as insufficient investment in innovation,market inefficiency and so on(Tassey,2004).In order to solve the "market failure" caused by enterprise technological innovation and better encourage enterprises to implement technological innovation activities,governments all over the world have generally adopted government subsidy policies for enterprise technological innovation.By giving certain government subsidies to the technological innovation of enterprises with positive externalities,it is expected to make up for the benefit loss of technological innovation enterprises and encourage more enterprises to engage in positive externalities of innovation activities,so as to achieve the purpose of optimal allocation of social resources.However,previous studies have not reached a consistent conclusion on whether government subsidies can promote technological innovation of enterprises.In the aspect of theoretical research,the neoclassical economic school believes that the government can intervene appropriately in the problem of "market failure".On the other hand,the Austrian economic school,which opposes it,believes that the externality of technological innovation is an inevitable phenomenon inherent in the process of marketization,and the externality can be internalized by means of patent and intellectual property protection,which can be solved finally without government intervention.In the aspect of empirical research,many scholars find that government subsidies have a positive incentive effect on enterprise technological innovation,such as(Diamond JR,1999;Aschhoff,2009;Howell,2017);some scholars find that government subsidies crowd out enterprise R&D investment and have a negative impact on enterprise technological innovation(Lichtenberg,1988;Beason and Weinstein,1996;Clausen,2009).Other scholars' empirical studies show that there is an optimal scope of government subsidies for the incentive benefits of technological innovation of enterprises,and government subsidies beyond this range will crowd out the R&D investment of enterprises(Dominique and Bruno,2000).National factors may be an important reason for the inconsistency of the above empirical conclusions.Due to the differences in institutional background,development stage and subsidy policies in different countries,the incentive effect of government subsidies on technological innovation of enterprises may be different.China is the largest emerging market country in the world,and the government occupies a leading position in the allocation of resources,so the incentive effect of government subsidies on technological innovation of Chinese enterprises may be unique,which is one of the motivations of this paper.At the same time,this paper believes that,as an important macroeconomic policy,the government subsidy policy itself has a certain degree of uncertainty,which will affect enterprise technological innovation through factors such as short-sightedness of enterprise management.Therefore,to study the impact of government subsidy policy on enterprise technological innovation,we must comprehensively consider the impact of government subsidy on enterprise technological innovation from the two aspects of subsidy policy itself and policy uncertainty,which is another motivation of this paper.Based on the above research motivation,this paper takes the A-share listed companies in China as a sample and uses the number of authorized invention patents and the number of invention patents cited to measure the technological innovation output of listed companies.This paper studies the incentive effect of government subsidy policy on technological innovation of listed companies from two aspects of policy itself and policy uncertainty.On the one hand,this paper studies the incentive effect of government subsidy policy on technological innovation,and establishes a theoretical model of the influence of subsidy policy on technological innovation investment decision-making by using the optimal investment decision-making principle under uncertain conditions.the implementation of subsidy policy reduces the critical value of enterprise technological innovation project investment,which makes enterprises choose to make decision on technological innovation investment immediately.It is beneficial to the technological innovation of enterprises.On this basis,an empirical study is carried out,and it is found that: first,government subsidies have a "crowding-in effect" on R&D investment of listed companies,and government subsidies increase R&D investment of listed companies;secondly,government subsidies significantly increase the number of invention patents granted and the number of cited invention patents of listed companies;thirdly,government subsidies significantly improve the efficiency of technological innovation of listed companies;Finally,by introducing the regulation mechanism of external supervision,it is found that analysts' attention and institutional investors' shareholding significantly enhance the positive incentive effect of government subsidies on technological innovation of listed companies.On the other hand,this paper studies the incentive effect of the uncertainty of government subsidy policy on the technological innovation of listed companies.First of all,Poisson jump process is used to describe the uncertainty of government subsidy policy,and the optimal investment decision-making principle under uncertainty is used to establish a theoretical model that the uncertainty of government subsidy policy affects the investment decision of technological innovation of enterprises.Based on the analysis of the theoretical model,it is found that the adjustment intensity and frequency of government subsidy policy positively affect the critical value of enterprise technological innovation project investment,that is,the greater the adjustment intensity of subsidy policy and the higher the adjustment frequency,the higher the critical value of enterprise technological innovation project investment,the easier it is for enterprises to delay technological innovation investment,which is not conducive to enterprise technological innovation.Secondly,based on the conclusion of the above model,this paper makes an empirical study on A-share listed companies as a sample,and draws the following conclusions: the greater the adjustment of government subsidy policy,the lower the R&D investment intensity of listed companies.the lower the number of authorized invention patents and the number of cited invention patents;After controlling the company's R&D investment,the greater the adjustment of the government subsidy policy,the lower the number of authorized invention patents and the number of citation of invention patents.The higher the adjustment frequency of the government subsidy policy,the lower the R&D investment intensity of listed companies,and the lower the number of authorized invention patents and the number of citations of invention patents;but after controlling the company's R&D investment,the frequency of government subsidy policy adjustment has no significant impact on the number of authorized invention patents and the number of invention patents cited.It can be seen that the empirical conclusion is consistent with the theoretical model conclusion.Finally,this paper analyzes the influence mechanism of subsidy policy uncertainty on technological innovation of listed companies and the moderating effect of enterprise heterogeneity on technological innovation of listed companies.It is found that the negative impact of government subsidy policy uncertainty on technological innovation of listed companies is more obvious in private enterprises,small and medium-sized enterprises and growing enterprises.The uncertainty of government subsidy policy also suppresses the technological innovation of listed companies by aggravating the shortsightedness of the management of listed companies.On the basis of the above normative analysis and empirical research,this paper puts forward the following policy suggestions: continuously strengthen the dominant position of enterprise technological innovation;establish and improve the legal system and strengthen the protection of intellectual property rights;improve the financial disclosure system of government subsidies,strengthen the supervision of the use of subsidies,improve the decision-making mechanism of government subsidies,standardize the behavior of government subsidies,"good steel is used on the cutting edge",give full play to the maximum value of subsidies;Establish and improve the external supervision mechanism of listed companies;maintain the sustainability and stability of government subsidy policies.The possible innovations of this paper are as follows: firstly,this paper studies the impact of government subsidy policy on technological innovation of listed companies from the perspectives of subsidy policy itself and the uncertainty of subsidy policy.it enriches the theoretical content of government subsidy policy and technological innovation incentive research of listed companies.Secondly,this paper establishes a theoretical model of the impact of government subsidy policy on enterprise technological innovation by using the optimal investment decision-making principle under uncertainty based on real option theory.It can better describe the risk,uncertainty and long-term characteristics of enterprise technological innovation projects,more accurately evaluate the actual value of technological innovation projects,and practitioners can more accurately analyze and study the policy effects of government subsidies.Thirdly,under the condition that the tendency score matching model can not achieve a better covariable balance,the covariable balance is optimized by using the matching model based on genetic algorithm,and the covariable balance is better than the tendency score matching.the resulting average processing effect of government subsidy policy is also more accurate and reliable.Fourthly,this paper constructs two indicators of subsidy policy adjustment intensity and adjustment frequency to measure the uncertainty of government subsidy policy,and on this basis,quantitatively studies the impact of the uncertainty of government subsidy policy on the technological innovation of listed companies,which provides a theoretical basis for our country to formulate a long-term and stable innovation subsidy policy.At the same time,it can also evaluate the rationality of China's innovation subsidy policy in terms of frequency and time span.Fifthly,this paper uses the quasi-structural method based on the lag distribution of patent citation times to weigh the citation times of invention patents processed by the weight index to measure the output of technological innovation of enterprises.It can not only avoid many shortcomings of simply measuring technological innovation by the number of patents,but also better measure the quality of technological innovation of enterprises.