 R&D project subsidy V.S. government innovation reward: The effectiveness on corporate innovationYafei Li, Xiaoqi Dong and Jinping Sun China Economic Review, 2024, vol. 88, issue C Abstract: This paper compares the effectiveness of R&D project subsidies and government innovation rewards. Using a dataset of China's listed companies from 2008 to 2019, we investigate the associations of these two innovation grants with corporate innovation. The results indicate that both R&D project subsidy and government innovation reward can increase corporate innovation output. However, only government innovation reward can encourage private R&D investment. In addition, R&D project subsidy serves as an incentive role through the governance and financing mechanisms, whereas the government innovation reward has only a governance mechanism. Furthermore, the R&D project subsidy has a relatively poor impact on large firms and state-owned enterprises (SOEs), whereas the government innovation reward can still motivate their innovation. This study contributes to the expanding body of literature by providing diverse evidence of innovation grants from the perspective of the government subsidizing stage. Keywords: R&D project subsidy; Government innovation reward; Corporate innovation; Crowd-out effect; Substantive innovation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:88:y:2024:i:c:s1043951x24001779 DOI: 10.1016/j.chieco.2024.102288 Access Statistics for this article China Economic Review is currently edited by B.M. Fleisher, K. X. D. Huang, M.E. Lovely, Y. Wen, X. Zhang and X. Zhu More articles in China Economic Review from Elsevier |
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