China's Financial Development Eases The Research Of Enterprise R&D Financing Constraints

With the deepening of global economic integration,Chinese economy is gradually developing and is in a special period of transition and challenges,Xi Jinping pointed out that innovation is the first driving force to lead the economic development at the Fifth Plenary Session of the 18th Central Committee.He said "To adhere to innovation and development,we must put innovation in the core position of the country's overall development",and emphasized that "We should give full play to the leading role of scientific and technological innovation in comprehensive innovation".Enterprises as the absolute main force to promote technological progress,the scale and intensity of its R&D activities reflect the strength of scientific and technological innovation and core competitiveness.However,as a strategic investment activity,R&D investment is characterized by long period of activity,high adjustment costs,high information asymmetry and inability to provide effective asset collateral.As a result,the R&D investment is facing more severe financing constraints than the general investment.Therefore,financial support for enterprise R&D investment is particularly important.Based on the theory of financial development to promote technological progress,this paper focuses on how to play the key role of financial support in promoting technological progress better,and from different perspectives to study the mitigation effect of financial development on enterprise R&D financing constraints.Furthermore,focusing on differences of mitigation effect in different characteristics of enterprise,to provide a new micro-perspective for the enterprise R&D financing constraints and more comprehensive reference factors for the study of financial development and R&D financing constraints.After reviewing a large number of domestic and foreign literatures,this paper has found that the research on influencing factors of enterprise R&D financing constraints has been basically perfect,mainly involving the characteristics of enterprise,the characteristics of enterprise managers and government,but the research on the integration of financial development and R&D financing constraints is very little.This paper first analyzes the R&D financing situation of Chinese enterprise,as well as the current situation of Chinese financial development.Secondly,revealing the mitigation mechanism of financial development on enterprise R&D financing constraints based on the existing literature.Finally,based on unbalanced panel datum and multiple linear regression model,doing an empirical study of financial development is able to relieve enterprise R&D financing constraints by using the sample of enterprise listed on the Shanghai and Shenzhen A shares main board and SME board from 2008-2014 years,and further investigating the differences in the effect of scale,ownership,region,industry and other factors.The results show that:(1)financial development can significantly relieve R&D financing constraints faced by enterprise;(2)financial development has significant differences in R&D financing constraints of different scale enterprise,compared with large enterprise,financial development can relieve more R&D financing constraints of small and medium-sized enterprises;(3)there are significant differences in financial development on R&D financing constraints of different ownership enterprise,and financial development can more effectively relieve the R&D financing constraints of private enterprise,so as to promote its R&D investment level,while the mitigation effect on the state-owned enterprise is not obvious;(4)the eastern region with higher financial development level can promote R&D investment to a greater extent,while the central and western regions can not effectively stimulate R&D expenditure;(5)the mitigation effect of R&D financing constraints is different in industries.Compared with high-tech industry,non-high-tech industry can benefit more from financial development,and its R&D input level is significantly improved.Through this paper,the study of the micro-mechanism of the relationship between financial development and technological progress has been completed,which provides a new perspective for the financing constraints of R&D in enterprise.It provides a more comprehensive reference for the research of financial development and R&D financing constraints.On the other hand,conclusions of this paper point out the new direction to solve the problem of insufficient R&D investment,which provide some empirical evidence for the government to improve financial environment and enhance the level of technological innovation.