The Influence of Ownership Structure on Firms’ R&D Investments: An Empirical Investigation



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Submitted Jun 15, 2021
Published Jul 15, 2021
10.24018/ejbmr.2021.6.4.937

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By using listed companies of Shanghai Stock Exchange in the coal-mining industry as samples, this paper empirically tests the influence of ownership structure on firms’ R&D investments. Firstly, the influence mechanism of ownership structure on R&D investments is analyzed based on the principal-agent theory, and hypotheses are developed accordingly. Then, the empirical analyses are conducted based on data from China Stock Market & Accounting Research Database. The empirical results show that the degree of ownership concentration has a negative impact on firms’ R&D investments, and the improvement of equity counterbalance has a positive effect on firms’ R&D investments. The state-owned enterprises' firms’ R&D investments is higher than that of privately-owned enterprises. The highly concentrated ownership mode of state-owned shares may hinder their investment in firms’ R&D investments to some extent.

Keywords: Equity Concentration, Equity Counterbalance, Equity Nature, R&D Investments

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