Impact of the government’s financial support policy on technology innovation decisions of small and medium enterprise in Ho Chi Minh city

Abstract

The paper examines the impact of the government's financial support policy on technological innovation decisions in 150 small and medium enterprises (SMEs) in Ho Chi Minh City. The study uses the Binary logistic model to quantify the influence of the government’s financial support policies on the decision to innovate technology of enterprises. The survey was collected directly from 150 small and medium sized enterprises in 6 districts of Ho Chi Minh City. Research results show that the government's financial support policy has a positive impact on the enterprises’ technological innovation decisions. However, this policy is not effective at high-grossing enterprises. Additionally, the technological innovation decisions are affected by other factors, including the operating time and the volumn of the enterprise, and the market competitiveness. The research findings propose suggestions to improve the effectiveness of this policy on technological innovation decisions in SMEs.