A Study On The Effect Of Executive Incentive Contract Configuration On R&d Investment In The Presence Of Financing Constraints

With the advent of the information age,technology innovation has become a new engine to promote national economic growth and sustainable development of enterprises.As an important part of supporting enterprise innovation activities,R&D investment is influenced by multiple factors inside and outside the enterprise.The most direct and key influencing factor is the innovative decision-making behavior of executives.In order to motivate executives,the companies have established a diversified incentive mechanism including explicit incentive contracts such as monetary compensation incentive,equity incentive,and implicit incentive contract such as control rights incentive.However,whether different incentive contracts will have different impact on R&D investment,whether there is interaction between the incentive contracts,besides,considering the external environment,in the incomplete capital market,whether the incentive effect will change influenced by financing constraints,all should be considered important issues when the enterprises deploy executive incentive contracts in order to promote R&D investment in a targeted manner.In order to promote R&D investment more specifically,this paper starts from two perspectives of internal governance and external financing constraints,then explores the single effect and the integrated effect of executive incentive contracts on R&D investment,as well as the effect in the presence of financing constraints.To test the above problems,this paper takes China's high-tech listed companies as samples,selects monetary compensation incentive,equity incentive and control rights incentive as the indicators,then uses binary logistic regression to construct financing constraint index,and finally sets the multiple regression model.The empirical results show that there is no significant correlation between monetary compensation incentive and R&D investment.In further research,it is found that there is a significant positive correlation between the two in non-state-owned enterprises,but not in state-owned enterprises.However,both equity incentive and control rights incentive have positive excitation effect.In the process of investing in R&D,monetary compensation incentive and equity incentive have complementary effects,monetary compensation incentive and control rights incentive,equity incentive and control rights incentive both present substitution effects.When enterprises face financing constraints,the promotion effect of monetary compensation incentive and control rights incentive is suppressed,but the marginal effect of equity incentive is strengthened.The above empirical results reflect the problems that high-tech listed companies have in promoting technology innovation.Short-term monetary compensation incentive has no significant effect on R&D investment,reflecting the inadequacy of corporate governance and the negative effect of compensation controls in state-owned enterprises.However,the interaction between executive incentive contracts verifies the importance of deploying executive incentive contract portfolios.In addition,the inhibition of financing constraints indicates that the financing environment of technology innovation needs to be improved.In response to these problems,this paper puts forward relevant suggestions from the perspectives of enterprise and government.The innovations of this paper are as follows: First,comprehensive analysis of monetary compensation incentive,equity incentive and control rights incentive enrich the research on executive incentives.Second,exploring the interaction between executive incentive contracts at the R&D level provides reference for enterprises to configure effective executive incentive contract portfolios.Third,considering internal governance and external financing,this paper provides new analytical ideas for enterprises to promote technology innovation specifically.