Government subsidies as a policy instrument are used to alleviate market failure in research and development (R&D) activities. We aim to understand the influence of government subsidies on enterprises' R&D investment and performance. We are also interested in examining how the attributes of enterprise ownership act as a moderating variable for the relationship between government subsidies, R&D investment, and firm performance. We use firm-level data on China's manufacturing listed companies from 2011 to 2015. The results show that receiving government subsidies improves private R&D investment and firm performance, and state-owned enterprises (SOEs) can obtain more subsidies than private-owned enterprises (POEs). However, the impact of government subsidies on private R&D investment is stronger in POEs than in SOEs of China. In additional analyses, we also examine this relationship by industry, region, subsidy intensity, and R&D intensity. This study has important policy implications for regulators to improve the effectiveness of government subsidies.
This paper examines how investment in intellectual capital (IC) elements by textile and apparel companies improves firm performance measured in terms of profitability, market value, and productivity. The modified value-added intellectual coefficient (MVAIC) model is applied to measure IC. Using a panel of 35 Chinese textile and apparel companies for a six-year period (2013–2018), the results show that physical and human capitals are the strong factors that contribute to firm performance. In addition, relational capital negatively influences profitability and market value, and structural capital and innovation capital have a negative impact on employee productivity. We also find that the MVAIC model performs better in measuring IC than the original value-added intellectual coefficient (VAIC) model. This paper can provide some insights for corporate managers to enhance firm performance and gain competitive advantage by proper utilization of IC in traditional industries.
This paper aims to investigate the impact of intellectual capital (IC) and its components on financial competitiveness and green innovation performance. The data are collected from renewable energy companies listed on the Shanghai and Shenzhen stock exchanges during 2013–2018. The modified Value Added Intellectual Coefficient (MVAIC) model is applied as a proxy for IC efficiency, an index system is constructed to systematically measure financial competitiveness, and green innovation performance is measured by the total number of green patents, the number of green invention patents, and the number of green noninvention patents. The empirical results show that IC has an inverted U-shaped relationship with financial competitiveness and no impact on green innovation performance. Regarding IC components, human capital (HC), structural capital, and relational capital positively affect financial competitiveness. HC has a negative impact on green patents, while innovation capital has a positive impact on green invention patents. Physical capital is the main driving force of green innovation performance. This study will help managers to reasonably manage their IC resources to strengthen financial competitiveness and achieve green development.
The objective of this paper is to investigate the impact of coronavirus disease 2019 (COVID-19) on the financial performance and cash holdings of Chinese agri-food companies. We also examine whether or not company ownership, the affected areas, and leverage level affect this relationship. The empirical results show that the COVID-19 outbreak has had no significant impact on financial performance and the cash-holding level of agri-food companies. In addition, the financial performance of state-owned companies is enhanced during such a crisis, whereas COVID-19 reduced the financial performance and cash-holding level of privately owned companies. In middle- and high-risk areas, the pandemic has had a negative impact on financial performance, while it has had a positive impact on financial performance in low-risk areas. The negative impact of COVID-19 on cash holding is greater in highly leveraged companies than it has been in low-leveraged companies. This paper may provide some new insights for managers to ensure smooth operation and improve firms’ performance in order to overcome this crisis.
Using the data of Chinese listed companies during 2012-2016, this study examines the effect of environmental investment on financial performance, as measured by return on assets (ROA). We also examine the moderating effect of industry attributes, company ownership, and region on this relationship. The empirical results show that there exists a U-shaped relationship between environmental investment and financial performance. However, only 11% of Chinese listed companies can attain profitable environmental investment. In addition, the impact of environmental investment on financial performance in state-owned enterprises (SOEs) is higher than that in private-owned enterprises (POEs), and a company's environmental investment in China's eastern regions can do more to promote financial performance. The findings of this study can help managers to reasonably manage the tensions between environmental investment in relation to stakeholders and the pursuit of profitability.
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