Research On The Impacts Of The Direct Government Funding On Enterprise’s R&D Investment

Enterprises as the main body of R&D activities, at the same time, the most mainsource of the capital finance for the R&D investment is come from enterprises.However, due to the high risk of R&D activities and spillover effect of R&Dachievements, etc. To some extent, this will reduce enterprises’ R&D enthusiasm andsuppress enterprises’ R&D investment. Then, whether need government funding tostimulate enterprises’ R&D investment? This issue widely discussed by economists,represented by economist Joseph Schumpeter advocated direct government subsidyfor corporate R&D investment of the incentive effects, but as the representative ofArrow economists advocate the enterprise R&D behavior as the independent choiceof the enterprise and determined by the market itself, the direct government fundingcannot motivate enterprise R&D investment. So the debate about this issue is quitefierce.First, the paper analyses the ways in which the government funding influencesthe enterprise’s R&D input, and analyses the effect of the government funding forenterprise R&D investment in theory, the results show that the direct governmentR&D funding has a significant positive incentive effect for enterprise R&Dinvestment. Next, on the basis of the theoretical analysis, using the gem listedcompanies’ annual data in2012as the sample data, a multiple regression analysismodel is established to empirically analyse the incentive effect on direct governmentfunding for the enterprise R&D investment. Last, there is an analysis on the conditionof government funding incentive enterprise R&D investment from the R&Dinvestment structure distribution in this part. And the result shows that the enterpriseswhich have a better R&D base are more likely to be encouraged by the governmentfunding. So when taking into account of the object and the efforts of governmentfunding, our government will be more likely to choose those enterprises which havehigh technology research and development personnel proportion when otherconditions are similar in the enterprises.Through the analysis of this thesis, there is a certain understanding on the presentsituation of our government funding and the incentive effect, and this also providessome simple suggestions for the direct government funding, so the research of thispaper has a certain practical significance. But, how to take policy measures tomotivate enterprise R&D investment more effectively by our government is still worthy of further study.