The Effects Of R&D Investment On Enterprise Performance In The Context Of Financing Constraints

Under the promotion of Innovation-driven Development Strategy,the total amount of R&D investment in China has increased year by year.However,compared with developed countries,there is still a certain gap between China and innovative-type countries in terms of the R&D investment intensity.The lack of R&D investment intensity at the enterprise level will have a major impact on China's economic restructuring and upgrading process.A major reason for this situation is that R&D investment of enterprises generally faces high financing constraints and relies heavily on internal cash flow.Insufficient R&D investment will further affect the performance of the company,but there is yet not much domestic research on how the financing constraints has played a role in this impact.This paper chose the hi-tech enterprises as the research objects,selecting the public data of 372 listed companies in hi-tech industries from 2013-2017.Through theoretical research and empirical research,the main findings of this paper show that: First of all,financing constraints will inhibit corporate R&D investment,and this negative effect will be more significant for those enterprises that face higher financing constraints.Secondly,corporate R&D investment has a negative impact on corporate financial performance(operating profit margin),and has a positive effect on corporate market performance(Tobin's Q value)and continues into the next two periods.Last but not least,enterprises face different level of financing constraints have different R&D investment performance.Specifically,the higher level of financing constraints will alleviate the financial performance loss of R&D investment in the current period,and will deteriorate in the future;the higher level of financing constraint will continue to inhibit the market performance of R&D investment.According to the research conclusions,suggestions given as follow: the government should increase the guidance of enterprise R&D activities,broaden the financing channels of enterprises,and improve the information disclosure system.Enterprises should improve the efficiency during the use of R&D fund.Investors should pay more attention to corporation's intrinsic value when making investment decisions.