Political Connection's Influence On Corporate Performance From The Perspective Of Institutional Environment

China's current economy is transforming from high-speed growth to high-quality growth,and corporate innovation is the basis for high-quality economic growth.Innovation activities are the key source for enterprises to acquire core competitiveness.To achieve high-quality economic development,we must drive innovation.However,the current situation in China is that enterprises that are the main players in innovation have limited investment in innovation resources,lack of innovative capacity,and low innovation performance.As a phenomenon that is currently widespread,political connection has an important influence on R&D investment,innovation performance,and corporate performance.It is helpful to explore the mechanism of the political connection of entrepreneurial companies in the enterprise to help companies better distinguish the status quo and seize the situation.Development focus.Under the background of the important decision to comprehensively deepen reforms in the new era and provide great opportunities for the development and expansion of China's economy and enterprises,this paper hopes to take the political connection of GEM listed companies as the breakthrough point and explore the following issues:(1)What impact does the political connection of a startup company have on corporate performance?(2)What is the mechanism of the influence of entrepreneurial firms' political connections on firm performance?(3)Is the impact of R&D investment by startups on firm performance affected by other variables?In this paper,through a combination of literature research and empirical research,we first review institutional theory,innovation theory,and rent-seeking theory.Through mechanism analysis,we explore the influence of entrepreneurial firms' political connection on firm performance,and explore the mediating role of R&D investment.At the same time,the possible differences in the effect of this R&D investment on firm performance under different levels of external institutional environment were studied,and related research hypotheses were proposed.This paper selects the GEM companies that have been listed for five years and have continued operations from 2011 to 2016 as research samples,and tests the hypotheses proposed by the empirical analysis.The main conclusions of this paper are as follows:(1)The political connection of startup companies has a significant negative impact on firm performance,that is,companies that have political connections,their corporate performance is relatively poor;(2)The main cause of political connection has a negative impact on corporate performance.The reason is that the political connection has reduced the R&D investment of start-up companies,which has reduced the performance of enterprises,thus confirming that R&D investment plays an intermediary role between political connections and corporate performance;(3)The impact of R&D investment on corporate performance is affected by external systems.The impact of environmental levels on the level of institutional environment is better,and the effect of R&D investment on the improvement of corporate performance is more pronounced.This paper explores the relationship between political connections,R&D investment,institutional environment,and corporate performance.It proves that there may be "rent-seeking' situations in the negative impact of startup companies on performance.It is found that R&D investment is negative for entrepreneurial corporate political connections.The mediation mechanism of influence reveals the mechanism of the institutional environment's influence on R&D investment-corporate performance and enriches the research on the institutional environment.