Research On The Financing Sources Of Innovation Investment And Its Smoothing Mechanism

With the rising of knowledge economy and the accelerating of economic globalization,the importance of innovation for an enterprise and even a country is becoming more and more important.The 18 th session of the National People's Congress of the party has pointed out: "We must vigorously promote the strategic adjustment of economic structure,promote the combination of economy and science and technology,so that economic development depends more on scientific and technological progress".2016 G20 Hangzhou summit determines the construction of an innovative world economy as one of the themes.Modern enterprises pay more attention to the enterprise innovation activities,however,innovation investment is the key factor that directly influences and determines the ability of independent innovation of enterprises.In recent years,the investment in R&D investment has been increasing,and the overall innovation ability of the society has been strengthened,and the new and high technology enterprises have played an important role in promoting these achievement.In China's capital market,the GEM market is composed of high growth,small scale,high tech companies,it is more important to improve the efficiency of the gem listed company's innovation ability and innovation efficiency to improve the innovation ability of the whole society.Compared to fixed assets investment,the innovation investment of the enterprise has the characteristic of high adjustment cost,income uncertainty and weak exclusive.Enterprise innovation activities need long-term investment,once the shortage of funds will lead to innovation activities of the interruption or end,enterprises will suffer huge losses,so it's important to maintain sustainable investment in innovation.China's capital market started late,the system is not perfect,and it is still in a state of imperfect.With financing constraints phenomenon,the GEM listed companies want to through equity financing and debt financing need a high cost of financing.Pecking order theory also pointed out that the first choice of corporate innovation investment activities is internal financing channels,followed by external financing channels.On this basis,this paper studies the financing sources of innovation investment of listed companies on GEM,and the effect of external financing sources on the sustainability of innovation investment under different financing constraints.This paper chooses the growth enterprise market in Shenzhen from 2010 to 2015 on 510 listed companies as research samples,using Euler's equation to depict the innovation investment activities of enterprise,and use this model to depict theinnovation investment mechanism of smooth.Firstly,the companies on the GEM market innovation financing sources to test,results show that the internal financing channel is the main source of GEM listed companies innovation funds,and external channel of financing is an important source.And then,the paper tests the innovation investment mechanism of smooth which means when the internal financing source has fluctuated,innovation investment activities will be affected,at this point,the enterprise can choose external financing innovation investment to smooth fluctuations.The empirical results shows that equity financing source reacts a smoothing effect on the innovation investment activities.In the end,this article uses SA index as a measure of financing constraints to make a grouping regression,the empirical results show that compared with financing constraints,large enterprises with the lower financing constraints prefer to use external financing to smooth innovation investment fluctuations,regardless of higher financing constraints or lower financing constraints,debt financing source does not have a smoothing effect.Equity financing of the smoothing effect is more obvious in the lower financing constraints enterprises.Finally,the article robustness test also get the same conclusion.Research conclusion of this article to encourage innovation investment in China has certain policy implications,as well as the growth enterprise market innovation investment efficiency of listed companies,maintain the sustainability of the innovation activities to provide recommendations on the sources of finance.