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Unraveling the dynamics of R&D and firm productivity: Empirical insights from 27 Chinese industries with regional and ownership differences

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  • Peng, Xin-Yi
  • Lin, Ching-Yi
  • Mai, Te-Ke

Abstract

This study examines R&D input and productivity dynamics in the context of the "Made in China 2025" initiative in China. Analyzing over 4000 enterprises across 27 industries from 2016 to 2019, it uncovers regional and ownership-based variations in productivity and R&D levels. The study highlights the link between R&D efficiency and innovation and identifies negative relationships between productivity persistence, R&D efficiency, and uncertainty. Additionally, it explores the impact of subsidies and R&D variations in achieving the goals of the "Made in China 2025" plan. These insights are valuable for policymakers seeking to enhance competitiveness in China's evolving business landscape.

Suggested Citation

  • Peng, Xin-Yi & Lin, Ching-Yi & Mai, Te-Ke, 2024. "Unraveling the dynamics of R&D and firm productivity: Empirical insights from 27 Chinese industries with regional and ownership differences," Finance Research Letters, Elsevier, vol. 59(C).
    • Handle: RePEc:eee:finlet:v:59:y:2024:i:c:s1544612323010772
    DOI: 10.1016/j.frl.2023.104705
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    References listed on IDEAS

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    1. Yang, Tongbin & Zhou, Bo, 2025. "Does transition finance policies persistently fuel green innovation in brown firms? Investigating the roles of ESG rating and bank connection," Pacific-Basin Finance Journal, Elsevier, vol. 90(C).
    2. Brian Tavonga Mazorodze & Darlington Chizema & Phetole Emanuel Ramatsoma, 2025. "Linking R&D and Productivity in South Africa: The Moderating Role of Human Skills," Economies, MDPI, vol. 13(6), pages 1-22, June.
    3. Mohamad H. Shahrour & Alireza Rohani & Michal Wojewodzki & Dung V. Tran, 2025. "Carbon Performance and Financial Performance: How R&D Makes a Difference Pre‐ and Post‐Paris Accord," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 30(4), pages 4082-4094, October.
    4. Xiong, Wei & Jiang, Mengzhen & Liu, Yingying, 2024. "Digital economy, risk attitudes, and entrepreneurial decision-making in urban and rural households in China," International Review of Financial Analysis, Elsevier, vol. 96(PA).

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