Abstract:    Under the background of high-quality economic development and tax and fee reductions, it is of great theoretical and policy significance to study the impact of social insurance payment burden on enterprise innovation. Using the A-share data of listed companies in China, this paper empirically investigated the impact of the policy of gradually reducing the social insurance payment burden on enterprise innovation by constructing a difference-in-difference model. The study showed that: (1) the reduction of social insurance payment burden significantly increases the R&D investment intensity and intangible asset ratio of enterprises, which in turn has boosted their innovation; (2) the mechanism analysis showed that the income effect of the reduction of social insurance payment burden is relatively significant, while the substitution effect is very weak, and the reduction of social insurance payment burden significantly promotes the innovation of enterprises in the overall view; (3) the heterogeneity analysis showed that the decline in the burden of social insurance payments significantly promotes innovation among enterprises in high rate regions, private enterprises, and small enterprises compared to enterprises in low rate regions, state-owned enterprises, and large enterprises; (4) by comparing the implementation effects of the fee reduction reform policy in 2016 and 2019, it was found through the effect of the implementation of the fee reduction reform policy that the fee reduction in 2019 is larger and has a more significant effect on enterprise innovation. This paper identified the causal effects and mechanism of changes in social insurance payment burden and enterprise innovation, which helps the government to further optimize the social security fee reduction reform policy and promote enterprise innovation.

Key words: social insurance payment burden, phased contribution rate reduction reform, enterprise innovation