Institutional Investors And Corporate R&D Investment

Institutional investors'ownership can increase firm's R&D expenditure in developed countries, but it has different results in developing countries. Taking this as the research base, it will benefit the understanding of institutional investors from the innovation perspective.After doing the literature review on empirical study and theoretical research, using China Growth Enterprise Market data, this paper will testify if there is any relevance between institutional investors and corporate R&D. Then it classifies the institutional investors into different types and research on the relationship between different institutional investors and corporate R&D according to past methods. Taking the current situation as a consideration, it regards the ownership structure (ownership concentration and stock proportion restriction) as a moderating variable to moderate the relationship between them. And using the panel data, it does the following research using ownership structure as the moderating variable.The results tell that, for China GEM companies, institutional investors' ownership and corporate R&D have a significant positive relationship. Different types of institutional investors have different effects on R&D investment. The ownership structure has moderating effect on the relationship between them. More specifically, after classification of institutional investors by industry, social security fund, enterprise annuity and trust institutions have positive relations with R&D investment. The pressure sensitive institutions have positive influence on R&D investment while the others not. The stock proportion restriction has moderating effect while the ownership concentration's effect is not significant.