The Influence Of Government Subsidy And R&D Investment On The Performance Of Listed Companies

The State Council promulgated the "Decision of the State Council on Accelerating the Cultivation and Development of Strategic Emerging Industries"(hereinafter "Decision")to support strategic emerging industries in October 2010.In recent years,the state has attached great importance to the development of strategic emerging industries and invested a large amount of subsidy funds.These funds are mostly used for corporate R&D activities.General Secretary Xi Jinping emphasized that innovative development rank first in the five major development concepts.The "National Economic and Social Development Plan for 2018" proposes to strengthen the support and guidance of technological innovation for the real economy.Strategic emerging industries are important subjects for R&D.Strategic emerging industries play an important role in promoting economic development and industrial upgrading.Many scholars have studied the relationship between government subsidies,R&D and corporate performance,and laid the foundation for researching ways to improve performance.However,the results of various scholars are inconsistent.And scholars' research mostly focuses on the effect of government subsidies on corporate performance.There are few studies on how government subsidies affect corporate performance.That is,there are few studies on the mechanism of government subsidies.Understanding the mechanism of government subsidies acting on corporate performance is crucial to the country's decision on subsidy investment.Therefore,it is necessary to analyze the mechanism of government subsidies.It is also necessary to empirically study the effects of government subsidies,R&D investment on corporate performance,and the mechanism of government subsidies.On the basis of reviewing previous studies,this article defines related concepts and reviews the related theories of government subsidies and R&D.According to the relevant literature and theories,and at the same time,combining the actual situation,this article focuses on the analysis of the mechanism of government subsidies and R&D investment affecting corporate performance.On this basis,research hypotheses are proposed.Combining the government subsidies and R&D status of China's strategic emerging industries,we have charted the analysis of government subsidies to support the development of strategic emerging industries,and found that government subsidies,R&D investment and corporate performance have a consistent trend.After several rounds of screening,this paper selected279 strategic emerging industry listed companies and used data from 2010-2016 to build a fixed effect model of individual time to explore the impact of government subsidies and corporate R&D investment on corporate performance.The corporate performance of this article includes two dimensions of corporate financial performance and innovation performance.Based on the empirical results,in view of the unbalanced regional development in China and the different degrees of economic,financial development,and intellectual property protection in different regions,we divided the country into two regions: the eastern and central and western regions for further comparative analysis.It examines the similarities and differences of the effect of government subsidy and R&D investment on corporate Performance in different regions.When researching on strategically emerging industries listed companies nationwide,it was found that government subsidies can have a positive impact on the company's financial performance and innovation performance;R&D investment also has a significant role in promoting the company's financial performance and innovation performance;government subsidies has a significant incentive effect for R&D investment.From the perspective of the mechanism of action,in the process of government subsidies acting on financial performance and innovation performance,R&D investment has played a significant intermediary role.Afterwards,we examined whether the above conclusions have changed in different regions.The study found that the intermediary role of R&D investment in the eastern region has improved compared to the country,and no other conclusions have changed.In the western region,the following changes have taken place: The significance of government subsidies on corporate financial performance has declined.Government subsidies have not significantly stimulated R&D investment.Government subsidies cannot increase financial performance through R&D investment.No other conclusion has changed.According to empirical results and analysis,in order to improve the efficiency of the use of subsidies and promote the development of enterprises,the government should carefully select the target of subsidies,strengthen the monitoring of government subsidies,and improve the intellectual property protection system,in particular,strengthen the supervision of the use of subsidies and intellectual property protection in the western region.Enterprises should improve R&D efficiency and the efficiency of R&D results conversion.