Research On The Impact Of Government Innovation Subsidy On Enterprise Innovation Investment

Modern economic growth theory has clearly pointed out that technological innovation and knowledge production determine the endogenous growth of economy,but technological innovation and knowledge production come from research and development activities.Due to the nature of public products,R&D activities are characterized by non-exclusivity and non-monopolization of R&D results,which inevitably leads to the problems of insufficient private R&D investment and market failure of enterprises as the main body of innovation.The emergence of this phenomenon makes the government famous for intervening in enterprise innovation.Arrow(1962)study of innovation policy incentive effect laid the theory of government "guiding hand" start,pointed out that the government can take advantage of the public policy to make up for private benefits below part of the social benefits,therefore,government subsidies as an important policy tool widely used in the countries all over the world,to encourage enterprise technology innovation,and promote economic growth.But in the existing research due to the variable selection,measurement method choose and theoretical model building mode,thus about government innovation research of subsidy policy effects have not obtained the consistent conclusion,even for the same kind of innovation policy,also because the policy applicable background,the system of different and has different influence effects.As a result,the background of transition economies and innovation-driven development strategy in our country,promote enterprise technology strength and innovation is not only the realistic need to innovative national construction,improve the capacity and promote the development of micro enterprises subject to maximise profits,government subsidies innovation as an important policy tool,effectively play its role in the allocation of resources,to our country economic growth from rapid growth to high quality,has important theoretical and realistic significance.The research object of this paper is the manufacturing and knowledge intensive services a-share listed companies in our country,enterprise innovation of the public goods theory,risk theory,externality theory,the theory of market failure and government innovation subsidies,financing constraint theory,signaling theory as the starting point,in 2007-2019 data,research and development,innovation,government subsidies data and financial data as sample,according to the keywords retrieval method of manually collecting and organizing the related to innovation in government subsidies subsidies.Firstly comparative analysis of the developed countries,emerging economies,and the development of our government subsidy policy innovation,as well as the government's main funding scheme,then the concrete practice of our country government innovation subsidies descriptive statistical analysis,the study found that in recent years,the Chinese government and expenditure activities of science and technology are showing a steady growth trend year by year,the government subsidy and enterprise innovation investment presents the fast growth the tendency,in the government under the condition of increasing subsidies every year,the innovation of the enterprise investment also increased year by year,and presents the obvious industry,regional,and whether property and heterogeneity characteristics of export enterprises,Finally,we empirically analyze the allocation of government innovation subsidies,and the influence of government selection mechanism and firm response strategy on firm innovation input,and further investigate the influence of firm horizontal interaction strategy.The results of the empirical analysis show that: first,the Chinese government has the feature of preference in the implementation of subsidies,that is,the government has a certain screening mechanism.Specifically,this paper USES dynamic bivariate Probit model analysis results show that the real state of dependence and some observable enterprise heterogeneity characteristics drive the most innovative subsidies and persistence,innovation subsidy program participation in observed and not observed characteristics of enterprises,for innovation or subsidies will increase the likelihood of subsequent continued access to appropriate subsidies.Government innovation subsidies in addition to state dependent characteristics,also tend to choose the relatively low productivity,smaller,younger state-owned enterprise,especially in the current enterprise research and development foundation is weak,while the innovation support from government,by contrast,so the government's public resource allocation policy for purpose,innovation subsidy presents "ought to poverty alleviation" support strategy,rather than innovation subsidies is presented the strategy of "merit".Secondly,after controlling for the influence of government selection mechanism and firm response strategy,government innovation subsidies still have incentive effect on firm innovation input,and this incentive effect has heterogeneous results under different firm characteristics.Specifically,because government subsidies policy purpose and for different object selection mechanism to a certain extent,and enterprise exists because of the cost of the application will weigh whether to apply to the government subsidies,which lead to the problem "sample selection" will make the original there is a deviation analysis results,this paper USES the sample selection model to solve the OLS estimates of the nonlinear term and random error term of heteroscedasticity,and USES the MLE and half a parameter estimation method to estimate model parameters,the result shows that the government subsidies still support innovation incentive effect hypothesis,and,Furthermore,the moderating effect model is used to study the incentive effect.It is found that the incentive effect is more obvious in high-tech enterprises,export enterprises,non-foreign-funded enterprises,central China,south China and north China.Thirdly,from the vertical interaction between the government and enterprises,further consider the government innovation subsidies caused transverse interactive strategy of enterprise,more essentially measure the effect of the policy of government innovation subsidies,found that the enterprise's interactive dynamic imperfect competition weakens the government innovation subsidies to the enterprise innovation investment incentive effect.Specifically,knowledge spillover effect,which resulted in the existence of enterprise innovation activities have alternative,hence the innovation of government subsidies will be in the form the strategic interaction between businesses,the government subsidies for certain enterprise's innovation in motivating the enterprises innovation investment at the same time,may be it was originally used to support other companies give up spending on research and development of innovative activities.This paper USES dynamic imperfect competition model in the theory of industrial organization,further consider the lateral interaction between the enterprise and the enterprise strategy,enterprise need to choose two kinds of decision making,each period is a current profit maximization of production decision,the other is a longterm profit maximization of innovation investment decisions,but output decision will not affect the enterprise's innovation ability,on the assumption that the enterprise without storage capacity will not affect the future production of the enterprise,but now spending of r&d investment is affected by enterprise's knowledge level and indirectly affect product marginal cost in the future.Enterprise,therefore,the output of the current decision is a fully static process,research and development investment decision is a dynamic adjustment,namely enterprise short-term product market competition and long-term strategic competition,and all enterprises in accordance with the expected future income present value maximization of strategic choice for the optimal decisionmaking behavior,ultimately to achieve markov refining market equilibrium.The government innovation subsidies identified by integrating participant optimization with market structure endogenicity still have a significant incentive effect on firm innovation input.This research is mainly innovative in the following aspects: First,starting from the innovation subsidy policy of the Chinese government,it analyzes the allocation of funds in the process of the government's implementation of the policy,which is a supplement to the existing research on innovation subsidy of the government.For accurate analysis of government subsidy policy innovation,this paper fine collection and screening,the government subsidies data is divided into "innovation of government subsidy" and "government innovation subsidy",which can eliminate the government innovation subsidy effect in the study of the key variables exist confounders,more targeted to explore the effect of government innovation subsidies,on the other hand can put two kinds of subsidies in the same research within the framework of our country government subsidies subsidies for object selection strategy in the process of innovation.We find out the characteristics of the structure of the recipients of government subsidies over time,especially whether these enterprises enjoy long-term subsidies over time.A further analysis of the existing literature,contains the time dimension,inspect the innovation enterprises to participate in government subsidies or subsidies than innovation state dependent characteristics of the project,subsidies and enterprises to participate in the innovation project and the innovation and dynamic interaction process of the project,or a potential spillover effects across projects and to explore the heterogeneity of driver persistence and real state dependence,help to improve the efficiency of policy design and,is a supplement to the existing government subsidies innovation research.Secondly,considering the impact of government innovation subsidies on firm innovation input under the government selection mechanism and firm response strategy,the analysis using the sample selection model to control the "self-selection" strategy is an enrichment of the existing research on the effect of government innovation subsidies.Existing research assumes a "random strategy" for innovation subsidies,which may lead to an upward bias in estimates of impact effects.Most of the existing researches on the control of "non-stochastic strategy" adopt the data-driven method and lack the support of economic theory.In this paper,considering the selection mechanism of the government to the enterprise and enterprise strategy for the government's response,based on the economic theory foundation,sample selection model is established,under control a nonrandom strategy analysis of government innovation subsidies influence on enterprise innovation into effect,and parameters and parameter estimation method and panel OLS method comparative analysis.At the same time,the moderating effect of firm heterogeneity on this effect was further investigated.This research is based on the economic theory,the application of structural model to the existing government innovation subsidy effect to further enrich.Thirdly,from the economic theory reality,based on the structural empirical model and considering the interaction strategy of enterprises,this paper empirically analyzes the implementation effect of government innovation subsidy policy,which is a deepening of the existing policy effect measurement research.In the existing studies on policy effect assessment,most of them adopt the PSM-DID method,which is influenced by data drive and lacks the support of economic theory.Although there are based on economic theory to establish the structure of the empirical model research,but generally ignored the interaction between corporate strategy: the government subsidies for the innovation of an enterprise can lead to the increase of the enterprise's own innovation input,but another enterprise may offset its own innovation investment,thus to some extent offset the effect of the subsidy policy of government innovation.In this paper,based on the idea of new empirical industrial economic theory,the participants optimization behavior,market structure,endogenous,inter-temporal dynamics and strategic interaction and data consistency,using the dynamic structure of imperfect competition model in the theory of industrial organization(DMIC)to analyze the government innovation subsidies influence on enterprise innovation investment behavior,can fundamentally analysis of government subsidy to bring the real effect of innovation.According to the research of this paper,therefore,the government continuously intensify innovation subsidies under the realistic background,the government should implement the policy tool of the institutionalization and permanent form,to standardize the government subsidy funds allocation at the same time,strengthen the internal supervision and external supervision mechanism during the process of using,urged a more perfect legal system and intellectual property protection system,government support for enterprise innovation and rules-based,there are rules,and motivate enterprise innovation power,realize the maximization of the value of government innovation subsidies.