Internationalization And The R&D Expenses Of Chinese Construction Enterprises

Construction industry is the pillar industry of the national economy,occupying the pivotal place in the national economy.China's economy has entered the new normal and the government has implemented the strategy of "One Belt,One Road",which push Chinese construction enterprises to go abroad and participate in the international competition.However,in order to gain a foothold in the more competitive international market,Chinese construction enterprises have to increase their R&D expenses to enhance their innovation capabilities and international competitiveness.It is a common phenomenon that Chinese construction enterprises have a low degree of internationalization and have no sufficient international influence in the international market,as a result,this paper will study the relationship between enterprise internationalization,as well as the environment of internationalization,and R&D expenses.Based on the knowledge based view and the organizational learning theory,this paper puts forward the hypotheses about the relationship between internationalization of construction enterprises and their environment and R&D and innovation activities,considering the characteristics of construction business.Taking 132 Chinese construction enterprises listed on the A share market as the research object,this paper collects the unbalanced panel data from 2012 to 2016.This paper empirically studies the impact mechanism of political environment and internationalization cultural distance on R&D innovation activities of enterprises.It is found that the degree of internationalization and the political environment of internationalization have a positive impact on R&D investment,while the cultural distance of internationalization has a negative impact on R&D investment.In addition,in the international environment with relatively clean political environment,increasing the degree of internationalization can significantly enhance the R&D investment.When the level of internationalization of enterprises is low,the improvement of cultural distance cannot have a significant impact on R&D innovation expenses,but the improvement of political environment will have a positive impact on R&D investment.Compared with cultural distance,political environment have the greater impact on R&D activities.When establishing overseas subsidiaries,Chinese construction enterprises should give the priority to countries or regions with relatively clean political environment.