Abstract
This study investigates how R&D subsidy and non-R&D subsidy affect entrepreneurial firms’ initial public offering (IPO) performance in an emerging economy like China. Analyzing data from 269 IT (information technology) entrepreneurial firms in China, we found that R&D subsidy has an inverted U-shape effect on IPO performance, while non-R&D subsidy has a positive effect on IPO performance. Furthermore, both state ownership and patent intensity moderate the inverted U-shape relationship between R&D subsidy and IPO performance. In contrast, neither of them moderates the positive relationship between non-R&D subsidy and IPO performance. These findings contribute to the literature on the effectiveness of government subsidy by highlighting the symbolic effect of government subsidy on external financing in emerging economies, and offer important practical implications to entrepreneurial firms and government funding agencies in China.
| Original language | English |
|---|---|
| Pages (from-to) | 108-120 |
| Number of pages | 13 |
| Journal | Research Policy |
| Volume | 47 |
| Issue number | 1 |
| DOIs | |
| Publication status | Published - Feb 2018 |
| Externally published | Yes |
Keywords
- IPO performance
- R&D subsidy
- non-R&D subsidy
- patent intensity
- signaling effect
- state ownership
ASJC Scopus subject areas
- Strategy and Management
- Management Science and Operations Research
- Management of Technology and Innovation
