Government Intervention, Nature of Ownership and Enterprise Investment Efficiency——An Empirical Research Based on Panel Data Analysis

Abstract

In the critical stage of economic transformation and upgrading, the government has a strong incentive to intervene in the investment behaviour of enterprises under the double assessment of political and economic indicators. This paper found that government intervention has a significant impact on enterprise investment, by providing financial support and other means to promote enterprises to expand investment, but due to the lack of effective guidance, it turns into over-investment. After further distinguishing the nature of ownership between state-owned enterprises and non-state-owned enterprises, the phenomenon that government intervention affects enterprise investment is more obvious in state-owned enterprises, which is reflected in promoting over-investment and restraining under-investment. Therefore, government intervention will affect the investment efficiency of state-owned enterprises to a greater extent and make them develop in the direction of over-investment. This paper provides an overall perspective to explore the impact of government intervention on enterprise investment behaviour under the rapid economic growth.

Product differentiation and export incentive schemes: A game theory approach

“…Many governments provide support to their industries and firms. They do so for a variety of reasons, namely (1) to support fragile industries or regions, (2) to compensate for exceptional situations, (3) to foster national industries to compete in either the European or the global market, (4) to provide goods or services in the event of market failure, and (5) to promote internationalisation and R&D (Lin, 2021;OECD, 2021). In general, the aim of government support is to increase social welfare (Wilkinson & Brouthers, 2006).…”