Pilot Free Trade Zone, Financial Supply and Enterprises’ R&D Investment

Abstract

Abstract: The construction of Pilot Free Trade Zones (FTZ) and financial supply are included in the decision-making model of enterprises’ R&D investment, and their impact and mechanism on enterprises’ R&D investment are deduced. Empirical testing is conducted using regional and listed enterprise data from 2012 to 2020. The study finds that FTZ significantly promotes enterprises’ R&D investment, the financial supply plays a positive role in this, and under the regulation of direct financing supply, which mainly consists of stocks and bonds, the FTZ has a stronger promoting effect on R&D investment. The mechanism test results reveal that a coordinated implementation of FTZ construction and financial supply can promote enterprises’ R&D investment by reducing debt financing costs, enhancing the agglomeration effect of foreign enterprises, and reducing market competition, but cannot by reducing equity financing costs and enhancing the agglomeration effect of domestic enterprises.

Key words: Pilot Free Trade Zone, financial supply, enterprises’ R&D investment, moderating effect, mediating effect

Jiao Yongxiang, Xu Fen, Yang Hongen. Pilot Free Trade Zone, Financial Supply and Enterprises’ R&D Investment[J]. Management Review, 2024, 36(4): 115-129.

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