Research On The Impact Of Government Subsidies On R&D Investment Of Industrial Enterprises In China

As the cornerstone of our country,industry plays an important role in the economic development.However,with the coming of economic transformation,innovation has become a new driving force for economic development.And the extensive development is no longer adapted to the current situation.At the same time,the developed countries' economies are waiting for recovery,and the industrial strategies have put forward one after another.Under both internal and external pressures,innovation-driven development has become an effective way for China's industrial transformation and upgrading.However,the external effects of innovation and the imperfection of intellectual property protection policies have seriously damaged the enthusiasm of the R&D of enterprises.the government,as a "tangible hand",should actively intervene in the R&D of enterprises in the face of market regulation failure.Therefore,this paper will discuss whether the government's positive intervention will have an impact on R&D investment of Chinese industrial enterprises.Firstly,the existing researches on this issue have been systematically reviewed in the study.Secondly,based on the analysis of the current situation and theoretical mechanism,this paper,using the panel data of industrial enterprises above the industry level from 2009 to 2016 year,studies the impact of government subsidies on the R&D investment of industrial enterprises.And then from that perspective of property right structure,the article further discusses whether the effect of government subsidies will change with the change of the proportion of state-owned enterprises in the industry.First of all,from the empirical results of the fixed effect model,the effect of government subsidy on R&D investment is obviously positive,and the government subsidies give full play to the incentive effect.And then from the threshold model estimation results,the impact of government subsidies on R&D investment has a double threshold effect on the proportion of industry state-owned.That is,under the influence of the adjustment of property right structure,the impact of government subsidies has certain structural differences.When the proportion is not more than 0.2064,the government subsidies will squeeze out the R&D investment.When located in the interval of(0.2064,0.5064],the government subsidies have a significant incentive effect.That is,the government has fully played the role of adjusting and controlling in the situation.However,when the proportion is over 0.5064,the influence coefficient of the government subsidies is negative but not significant.As explained above that the incentive effect of government subsidies only can be played under the reasonable property right structure.Besides,the results also show that the proportion of industry state-owned,the demand of new product,the average size of the enterprises and the cost rate have positive impacts on the R&D investment,while the profitability and the market extroversion have negative impacts.Finally,according to the research results,this paper argues that the uneven development of China's industry is characterized by obvious differences in industry characteristics.Therefore,the government should take full consideration of the industry characteristics of the enterprise,optimizing the allocation of government funds to avoid "one size fits all" operation and the low efficiency or ineffectiveness of the expenditure.In addition,a reasonable property right structure helps to give full play to the incentive effect of government subsidies.At present,our country is in the period of economic transformation,and the market mechanism is not yet perfect,so it is essential to give full play to the functions of government regulation and control.Therefore,in the industrial transformation and development of China,the government should promote the reform of the state-owned enterprises reasonably and properly regulate the proportion of the state-owned enterprises in various industrial industries,not only to ensure the effective guidance of the government,but also to avoid the excessive control of the operation of the market mechanism.