Research On The Political Connection,Government Subsidy And Financial Performance Of High-tech Entrepreneurial Firms

As the national guide industry upgrading and support the high technology,the High-tech enterprises listed on ChiNext have become the main beneficiary of government subsidies.Enterprises obtaining the government subsidies is more to improve its performance,however,affected by many factors,government subsidies will be alienated in the actual implementation process,resulting in the effect of government subsidies are inconsistent with the purpose of the government subsidies.Under the background of of China 's transition economy,the government still has the initiative on the allocation of resources,therefor,the establishment of political connection between enterprises and the government will have certain impact on the enterprises' acquisition of government subsidies.Since political relations can influence the likelihood or quantity of government subsidies,So,political connection will no doubt be a negligible factor leading to the results of government subsidies be alienated.In this thesis,High-tech entrepreneurial enterprises are used as the research objects and literature induction,theoretical analysis and empirical research methods are applied to analyze the relationship between political connection,different types of government subsidies and financial performance.In this thesis,after summarizing literature on the relationship between political relations,government subsidies and financial performance,based on the theory of political connection and government subsidy,the method of adjusting effect,three groups of hypothesis have been put forward,high-tech entrepreneurial enterprise with 2012-2015 are used as the research sample,and non-balanced panel data are used for empirical research.The empirical results show that:(1)There is no significant correlation between political connection and government subsidies,whether R&D or Non-R&D government subsidies;(2)R&D and Non-R&D government subsidies have a significant improvement in the financial performance of enterprises,and R&D government subsidies have a greater impact on financial performance than Non-R&D government subsidies;(3)Political connection has different moderating effects on the relationship between different types of government subsidies and financial performance,Political connection do not weaken the improving effect of R&D government subsidies on the financial performance of enterprises,while,it does weaken the improving effect of Non-R&D government subsidies on the financial performance of enterprises.Accordingly to the results,this thesis proposes the following recommendations:(1)the value of political connection should be correctly realized.For the High-tech entrepreneurial enterprises listed on ChiNext,the "political resources illusion" should be avoided,when seeking political connection,enterprises should analyze the pros and cons,grasp the right degree,so that the establishment of political connection is conducive to the development of enterprises;(2)The structure of government subsidies should be optimized,When enterprises apply the government subsidy,it is necessary to refine the types of government subsidies,improve the efficiency of government subsidies,and then enhance the financial performance more effectively.Innovation point of this thesis is:(1)the high-tech entrepreneurial enterprises are used as the research sample,which broadening the scope of political connection studies and related literature,making up the vacancy of the sample in the previous literature;(2)Government subsidies are classified into R&D subsidies and non-R&D subsidies,broadening the research perspective of government subsidies;(3)the moderating effect of political connection on the relationship between different types of government subsidies and financial performance are studied,which revealing the ways and mechanisms of political connection to distort the efficiency of resource allocation furtherly.This thesis enriches and expands the literature on political connection and government subsidies,provide a new perspective for further study of the impact of government subsidies on corporate performance,at the same time,it has certain practical significance to improve the redistribution efficiency of government subsidies and enhance the financial performance of enterprises.