Economics at your fingertips  

Can government subsidy strategies and strategy combinations effectively stimulate enterprise innovation? Theory and evidence

Wanshu Wu, Kai Zhao () and Lei Li
Additional contact information
Wanshu Wu: Huaqiao University
Kai Zhao: Huaqiao University
Lei Li: Huaqiao University

Economia Politica: Journal of Analytical and Institutional Economics, 2021, vol. 38, issue 2, No 1, 423-446

Abstract: Abstract This paper tries to disentangle between the effects of non-R&D and R&D subsidies, and explores the mechanism of different subsidies and their combination on R&D investment and innovation output of listed enterprises in China by combining theory with empirical research. Based on the unbalanced panel data of 2707 Chinese listed enterprises from the year 2008 to 2015, this study confirms that both R&D subsidy and non-R&D subsidy have an incentive effect on the R&D investment, but the former is more effective than the latter. When R&D subsidy is at a high level, there is a positive relation between government non-R&D subsidies and enterprise R&D investment; sufficient non-R&D subsidies can effectively strengthen the incentive effect of R&D subsidies on R&D investment of enterprises. Furthermore, R&D subsidy can promote the innovation output of enterprises through direct and indirect paths, whereas, non-R&D subsidy or subsidy policy-mix has a certain “masking effect” on the innovation output.

Keywords: Non-R&D subsidies; Strategy combination; Subsidy policy-mix; R&D investment (search for similar items in EconPapers)
JEL-codes: C5 H20 L22 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from

DOI: 10.1007/s40888-021-00230-y

Access Statistics for this article

Economia Politica: Journal of Analytical and Institutional Economics is currently edited by Alberto Quadrio Curzio

More articles in Economia Politica: Journal of Analytical and Institutional Economics from Springer, Fondazione Edison
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

Page updated 2022-01-01
Handle: RePEc:spr:epolit:v:38:y:2021:i:2:d:10.1007_s40888-021-00230-y