The Impact Of Government Subsidies On Innovation Performance Of Listed Companies

With market economy developing continuously, competitive pressure on enterprises exacerbated by domestic and foreign markets is becoming increasingly intense. As far as individual enterprises are concerned, the innovation capability of enterprises directly related to their future survival, which is the basis for their development. However, the current level of corporate R&D, compared with developed countries, is still in a backward stage mainly caused by "market failure". The use of macro-control means for the government to intervene in the market are thus required:reducing business losses through financial grants or other incentives, encouraging enterprises to expand R&D investment, enabling enterprises to become the main body of innovation activities,improving business performance, and finally bringing along the improvement of innovation of the whole country. While the listed companies represent the overall innovation performance level of enterprises in China, based on the background of the establishment of an innovative country and independent innovation being strongly advocated, it is appeared to be significant for us to explore the impact of government subsidies on innovation performance of listed companies.This paper takes the2011-2013China bio-pharmaceutical listing corporations as the object of the study, exploring the impact of government subsidies on innovation performance of listed companies. The industry can highly represent the China’s high-tech industry and its R&D expenditure and innovation output is also large, that is reason why we choose it. Based on China’s national conditions, Bio-pharmaceutical industry in China has broad space for development, and there is less research of domestic and foreign experts and scholars in this field involve.Firstly, we summarize the relevant domestic and foreign literature reviews, and propose hypotheses. Secondly, based on2011-2013of52listed companies’ biomedical data, we build econometric models, and empirical analysis of the research hypothesis is further discussed. Finally, the conclusions drawn in this article include:1.government subsidies promote R&D investment;2. government subsidies positively stimulate innovation performance of enterprises;3.R&D investment directly affect the output of innovative performance;4.government subsidies has a moderating effect on the relationship between R&D and innovation performance.