The impact of government subsidies and tax preferences on patent quality and its threshold effect——An empirical analysis based on the listed companies in the new energy automobile industry

Abstract

Abstract: As one of China′s strategic emerging industries, the level of technological innovation of new energy vehicles determines whether China can occupy a favorable position in the international market. In order to encourage new energy vehicle companies to overcome technical difficulties, the Chinese government uses policy tools such as government subsidies and tax incentives to support corporate innovation. Among them, government subsidies, as unpaid government expenditure items, have high fund specificity. Enterprises that receive subsidies will list these funds as R&D investment, so as to reserve funds for technological innovation activities. The tax incentives are the after-tax income obtained when a company′s products are tested by the market, which can not only offset part of the research costs, but also alleviate the risks of corporate innovation to a certain extent. These policies respectively represent the "pre-incentive" and "post-incentive" of the enterprise innovation process, and the combination of them can realize the complementary advantages of policies.
Many studies have analyzed the incentive effect of each policy on enterprise output. In reality, the government often uses a variety of policy tools to support the technological innovation of new energy vehicles. If there is a lack of effective policy linkage and combination allocation between different policies, resulting in policy tools "working alone", they will not be fully utilized and financial funds will be wasted. However, at present, there is a lack of theoretical and empirical research on the effects of different policy combinations, which makes it difficult to provide more accurate theoretical support for policy making.
Based on the above analysis, this paper selects the data of listed companies in China′s new energy vehicle industry from 2010 to 2018 as the research object. On the one hand, this paper studies the effects of government subsidies and tax incentives on patent quality. On the other hand, from the perspective of policy collocation, this paper also constructs a panel threshold model to further analyze the threshold effect on patent quality when the two policies are used in combination. The research yielded three main findings. First, both policies have a positive incentive effect on patent quality, though the effect of government subsidies is stronger. Second, when used in combination, subsidies need to be at a medium level to maximize the effect of tax incentives. Third, high-level tax incentives are most conducive to promoting the effect of government subsidies. Only by identifying and making full use of the thresholds can the optimal combination of the two policy tools be realized.
Therefore, the government should make full use of the direct advantages of government subsidies and the indirect advantages of tax incentives to achieve optimal coordination of policies. When different policies are used in combination, it is still necessary to pay attention to the appropriate policy inclination. Empirical evidence shows that excessive government subsidies will weaken the effectiveness of tax incentives. Therefore, it is necessary to grasp the appropriateness of new energy vehicle enterprises′ subsidies. At the same time, the government should further increase the scope of tax incentives for new energy vehicle companies, and use the supplementary function of tax incentives in stimulating innovation, so as to achieve complementary advantages of different policies.

Key words: government subsidy, tax incentive, patent quality, new energy vehicle, threshold effect

Liu Lanjian, Zhang Meng, Huang Tianhang. The impact of government subsidies and tax preferences on patent quality and its threshold effect——An empirical analysis based on the listed companies in the new energy automobile industry[J]. Science Research Management, 2021, 42(6): 9-16.

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