Discussion Paper
No. 2018-85 | December 13, 2018
Huiling Liu, Fei Xing, Kseniya Yakshtas and Bo Li
Does the high-tech enterprise certification policy promote innovation in China?

Abstract

This study investigates the impacts of Chinese high-tech enterprise certification policy on enterprise innovation by exploiting the unique data of listed companies and their affiliates from 2006 to 2015. The authors exclude firms certified after year 2009 from the sample, because they may have exhibited R&D manipulation. The results show that high-tech enterprise certification can promote Chinese enterprise innovation, especially the innovation captured by invention patents. The results of a rich set of robustness tests all support this conclusion. Regarding the underlying mechanism, high-tech enterprise certification can influence enterprise innovation through tangible and intangible channels. Heterogeneity analysis shows that private enterprises, enterprises in industries with more competition, and equity-inspired enterprises benefit most from high-tech enterprise certification. This paper helps to scientifically evaluate the validity of Chinese innovation policy and contributes to a more comprehensive understanding of enterprise innovation’s driving forces as well as the inconclusive relationship between government support and enterprise innovation.

Data Set

JEL Classification:

O31, O32, O38

Cite As

Huiling Liu, Fei Xing, Kseniya Yakshtas, and Bo Li (2018). Does the high-tech enterprise certification policy promote innovation in China? Economics Discussion Papers, No 2018-85, Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2018-85


Comments and Questions



Anonymous - Comment
December 28, 2018 - 01:21
The research finds out the interaction between HTE certification policy and enterprise innovations. Even though mauch previous research has studied innovation related activities, this paper still represent a new perspective that enterprises benefit a lot from the government policy in terms of innovations. Considering the potential mechanism which influences the innovations shows that thorough work has been done in this research. For example, authors used various methods in the part of robustness tests. Besides that, key variables in the empirical analysis is quite proper and reasonable. There is one part which is relatively ambiguous. In the final paragraph of 4.2.4, if companies that obtain other types of qualification certificates are not excluded, will that influence the results?

Li Bo - Reply
January 03, 2019 - 01:05
Thank you for the comment.Regarding the question you mentioned, we would like to point out that, all the basic results shown in our paper did not exclude firms engaged in other qualifications. However, for robustness check, we have tried to take this into account. Column 3 and 4 in Table 7 showed the test result. We can find that the relevant coefficients are still significant and positive, and the magnitudes are very close to the previous results, which indicates that the main conclusions are literally not affected. In addition, in our sample, there are only 72 firms obtaining other types of qualification certificates concurrently, which also confirms that our basic conclusions would not be influenced.

Jing Yang - comment
December 28, 2018 - 02:29
I think the study demonstrates an interesting fact that Chinese enterprise innovations can be promoted by attaining high-tech enterprise certifications. Apparently, there are some contributions of this research, including exclusion of some firms that engaged in R&D manipulation in the sample, and robustness tests that conducted to make further analyses. In detail, the total number of companies that had HTE certificates in their home provinces perspectively indeed act as an appropriate instrumental variable in Heckman two-step method. One thing to be noticed is that always making clear explanation of main variables in the study in order to clarify statements.

Li Bo - Reply
January 03, 2019 - 00:58
Thank you for your review. We'll add some explanation of main variables.

Anonymous - Invited Reader Comment
January 03, 2019 - 08:20
I wanna make four comments on this paper. First, the paper finds a new angle to study an old question, which I believe is quite creative.Second, the paper uses the special case and data, and they dealt with their data in a different way from most of others. They took all the firms related into consideration. Their methods and ideas have an important value. Third, they considered a very important problem as well. They eliminated all the firms engaged in R&D manipulation, which may affects the results. So what the authors have done made their results pretty convincing.Finally, I would like to say that maybe the authors can discuss much deeper. For instance, would they explore other effects following the innovation? Like how the innovation effects influencing the firms value then?

Li Bo - Thanks
January 11, 2019 - 03:55
Thank you for your comments.

Anonymous - Referee Report 1
January 24, 2019 - 12:01
see attached file
[ Download attached file ]

Li Bo - Reply
February 15, 2019 - 07:35
see attached file
[ Download attached file ]

Bo Li - Revised Version
March 13, 2019 - 08:06
see attached file
[ Download attached file ]

Anonymous - Referee Report 2
March 18, 2019 - 08:59
see attached file
[ Download attached file ]

Li Bo - Reply
April 01, 2019 - 10:25
See attached file

Li Bo - Reply
April 01, 2019 - 10:25
See attached file
[ Download attached file ]

Li Bo - Revised Version
April 01, 2019 - 11:23
see attached file
[ Download attached file ]