Abstract:       Evaluating the implementation of China′s unique innovation-target management system from the perspective of R&D manipulation is crucial for driving high-quality development. This paper used the Five-Year Plan as a quasi-natural experiment to explore the micro-mechanisms by which innovation investment targets influence corporate R&D manipulation. The study found that the innovation investment targets set by the Five-Year Plan distort incentives, thus leading to increased R&D manipulation. This result remains robust after a series of stability and endogeneity checks. Further examination revealed that companies engaged in R&D manipulation tend to have larger credit funds, lower funding costs, and receive more government subsidies. The heterogeneity analysis indicated that R&D manipulation is more pronounced in regions with higher economic growth pressure, stronger innovation investment target management motivations, and in state-owned enterprises. The governance mechanism test showed that the development of digital government can mitigate the distorting incentive effects of innovation investment target setting. These findings will expand and deepen the research on the government target management theory and the motives for R&D manipulation under macro-institutional characteristics, thus providing theoretical guidance for optimizing government governance.

Key words: innovation input target setting, five-year plan, R&D manipulation, digital government