此文被Chinese Management Studies接收，于2020年第2期发表，全文见附件。

Abstract

Purpose – This paper studies the transformation effect of research and development (R&D) subsidies on firm performance in emerging economies from the perspective of capital and product markets. It also studies the mechanisms behind R&D subsidies’ transformation effect.

Design/methodology/approach – This study mainly explores the transformation effect of government R&D subsidies on corporate performance and its non-linear characteristics using Chinese A-share listed companies’ data from 2008 to 2016. We use the instrumental variable method to reduce endogenous problems and conduct a series of robustness tests to support our conclusions. The mechanisms of the transformation effect are explored via mediation effect models. The impact of firm heterogeneities on the transformation effect is also addressed.

Findings – Results indicate that R&D subsidies promote firm performance and experience obvious transformation effects only within a ‘moderate interval’. R&D subsidies play a vital role in enhancing firm performance mainly via two mechanisms, namely, signal financing and innovation incentives. Further, the transformation effect is much greater in non-state-owned, young, and large enterprises.

Originality/value – This paper contributes to understand that how R&D subsidies affect corporate performance from the perspective of capital and product markets by applying the linear and non-linear techniques that can clarify the relationship between the selected variables under study. The findings of this study might be helpful to identify the right directions for the government to implement and promote the R&D subsidy policies more effectively.

Keywords R&D subsidies; Firm performance; Signal financing; Innovation incentives