Research On The Relationship Between Free Cash Flow,ownership Concentration And R&D Investment

In recent years,China has actively supported technological innovation and development and put forward many measures.Only by continuously strengthening the research and development of high-tech enterprises,can we quickly achieve the goal of building an innovative country.R&D is highly risky and requires strong financial support.Because of transaction cost,incomplete information and incomplete contract,it is highly sensitive to free cash flow.For high-tech manufacturing enterprises,their capital investment in machinery and equipment,raw materials and other aspects is larger.So they are more difficult to finance from outside.Therefore,the adequacy of internal cash flow is very important for its R&D activities.This paper firstly reviews the existing literature at home and abroad,and summarizes the research on free cash flow,equity concentration and R&D investment,and determines the research objectives and research methods.Then,it expounds and analyzes the principal-agent theory,information asymmetry theory and free cash flow theory.And on this basis,it makes a more detailed theoretical analysis of the relationship among free cash flow,equity concentration and R&D investment.And then it puts forward research hypotheses.Then,this paper selects Shanghai and Shenzhen A-share hightech manufacturing listed companies as the research object,and selects 2724 balance panel data fro m 2013-2018.With the help of multiple regression analysis of Stata 14.0,this paper empirically tested the impact of free cash flow and equity concentration on R&D investment of high-tech manufacturing enterprises,and the regulatory effect of equity concentration on the relationship between free cash flow and R&D investment,and conducted Hausman test and robustness test.This paper also further studies the influence of different ownership on free cash flow,ownership concentration and R&D investment.Next,on the basis of the research conclusion,this paper tries to put forward some suggestions.Finally,this paper describes the limitations of the research and the possible research direction in the future.The main conclusions of this paper are as follows:firstly,ownership concentration has a positive effect on R&D investment.In the case of distinguishing the nature of ownership,there is no significant difference between state-owned and non-state-owned enterprises in the positive impact of ownership concentration on R&D investment.Secondly,Free cash flow has a positive effect on R&D investment.When the free cash flow of enterprises increases,the R &D investment activities of high-tech manufacturing enterprises will increase correspondingly.The relationship between free cash flow and R&D investment in state-owned holding enterprises is not significantly different fro m that in non-state-owned holding enterprises.Thirdly,under the control of other factors,the ownership concentration can regulate the relationship between free cash flow and R&D investment.That is to say,the improvement of equity concentration will strengthen the positive effect of free cash flow on R&D investment in high-tech manufacturing enterprises.Moreover,the regulation of ownership concentration on the relationship between free cash flow and R&D investment is more obvious in non-state-owned high-tech manufacturing enterprises.The possible contributions of this paper can be classified into two aspects.First of all,the research perspective of this paper is novel.Most scholars think that free cash flow will have an impact on R&D investment,but few people explore the role of other factors in the impact path.From the perspective of equity concentration of listed companies,this paper establishes the basic theoretical framework of free cash flow equity concentration R&D investment,and studies the impact of equity concentration on free cash flow and R &D investment.Secondly,the research object of this paper is special.At present,most of the researches on free cash flow and R&D investment are based on high-tech listed companies or manufacturing listed companies.This paper takes high-tech manufacturing enterprises as a sample to study,which not only enriches the research on free cash flow and R&D investment,but also guides the implementation of R&D investment in high-tech manufacturing enterprises.