Effect of the Strategic Emerging Industry Support Program on Corporate Innovation among Listed Companies in China
Round 1
Reviewer 1 Report
Comments and Suggestions for AuthorsThis paper empirically analyzes the impact of the Strategic Emerging Industry Support Program on the innovation of listed companies in China, and draws some meaningful conclusions. The main amendments are as follows:
(1) In the abstract part, the innovation of the article should be highlighted, and what role it has on the accumulation of scientific knowledge needs to be explained clearly in the abstract.
(2) The background of the introduction part is too explanatory, and the analysis of existing research is insufficient. It is recommended to revise and improve from the following ideas: (1) What work has been done in the past? (2) What are the problems? (3) How to solve these problems through self-research.
(3) The conclusion is not a simple list of results, and the conclusion should go beyond the results and go from the special to the general process. At present, the conclusion is partially condensed.
(4) Lack of discussion on key scientific issues, such as how policy introduction affects corporate innovation, what conclusions have been drawn from existing studies, whether there is a time lag in this impact, etc., lack of necessary discussion, and suggestions for supplementation.
Author Response
(1) In the abstract part, the innovation of the article should be highlighted, and what role it has on the accumulation of scientific knowledge needs to be explained clearly in the abstract.
Response: Thank you for your insightful comment. In the last sentence of the abstract, we add the paper's contribution to the accumulation of science, in China industrial policy has been widely debated whether it is effective, some scholars believe that the government's industrial policy can play a full role in driving the growth of the region and the economy, and some scholars believe that due to the dispersal of information, the government is unable to predict the direction of the future development, so the industrial policy is ineffective. The scientific contribution of our paper is to answer the question of whether industrial policy is effective and can actually achieve the government's desired goals using China's strategic emerging industries support policy as a case study.
(2) The background of the introduction part is too explanatory, and the analysis of existing research is insufficient. It is recommended to revise and improve from the following ideas: (1) What work has been done in the past? (2) What are the problems? (3) How to solve these problems through self-research.
Response: According to your comment, We included a paragraph in the introduction about past research efforts on strategic emerging industries, the problems that exist, and how this can be addressed through self-study. In past research, scholars have mostly investigated whether subsidies and tax incentives have an impact on innovation in strategic emerging industries; this research is based on strategic emerging industries in terms of sample, and due to possible sample selectivity bias, even if it is concluded that subsidies and tax incentives have an impact on such firms, the results may be endogenous. At the same time, this question only answers whether subsidies and taxes are useful and cannot explain whether industrial policy is effective. Therefore, we investigate whether strategic emerging industries promote firms' innovation by constructing a double-difference model and use subsidies and tax incentives as a mechanism to answer the question of the effectiveness of industrial policy.
(3) The conclusion is not a simple list of results, and the conclusion should go beyond the results and go from the special to the general process. At present, the conclusion is partially condensed.
Response: According to your comment, We modified the conclusions, the conclusions are summarized, summarized, and after the conclusion of the article to a general degree, the general conclusion of this paper is to explore the issue of whether the industrial policy is effective, through the strategic emerging industries industry support policy found that this industrial policy will make the supported enterprises have the motivation to complete the government's goals, although to a certain extent it will increase its R & D investment and innovation patent output, but did not really improve the business situation of the enterprise, the enterprise is not due to the policy to support the significant improvement of the ROE and ROA.
(4) Lack of discussion on key scientific issues, such as how policy introduction affects corporate innovation, what conclusions have been drawn from existing studies, whether there is a time lag in this impact, etc., lack of necessary discussion, and suggestions for supplementation.
Response: According to your comment, We added your suggestion at the end of the empirical evidence in the article that the policy is introduced to facilitate R&D and innovation by giving enterprises government subsidies, tax incentives, and redundant resources, and that the policy facilitates R&D and innovation by conveying signals to the banks to make them give enterprises convenient credit. Finally, the policy provides investors with information that allows them to hold the company's stock for a long period of time, thus reducing the risk of a hostile takeover, which is conducive to increased R&D and innovation by the company. Finally, the impact of policies has a dynamic effect, and the effect of policies to incentivize firms to invest in R&D becomes weaker over time. This is not the case for policy incentives for firms' innovation output.
Reviewer 2 Report
Comments and Suggestions for AuthorsThe authors analyzed in good depth the relationship between the Strategic Support Program for China's Emerging Industry and the level of innovation of strategic companies in the Chinese emerging industry. With the application of the model, the strategic innovation behaviors of companies became evident in the Strategic Support Program for Emerging Industries via research and development (R&D) and through patents, neglecting the efficiency of innovation. efficiency and quality, and was unable to convert the results of patents into company profitability. They were therefore able to understand the impacts of the support program, through the granting of subsidies, tax incentives and easy access to credit, as well as the reduction of stock liquidity, causing increases in business investment in R&D and, consequently, in the number of patent companies are granted. Our results also indicate that for state-owned enterprises in strategic emerging industries, government support in the form of tax incentives has the strongest effect on innovation; on the other hand, for private companies, innovation is more strongly stimulated through credit support and tax incentives. For all of this, I consider the article to be very important for the community, companies and public institutions.
Author Response
The authors analyzed in good depth the relationship between the Strategic Support Program for China's Emerging Industry and the level of innovation of strategic companies in the Chinese emerging industry. With the application of the model, the strategic innovation behaviors of companies became evident in the Strategic Support Program for Emerging Industries via research and development (R&D) and through patents, neglecting the efficiency of innovation. efficiency and quality, and was unable to convert the results of patents into company profitability. They were therefore able to understand the impacts of the support program, through the granting of subsidies, tax incentives and easy access to credit, as well as the reduction of stock liquidity, causing increases in business investment in R&D and, consequently, in the number of patent companies are granted. Our results also indicate that for state-owned enterprises in strategic emerging industries, government support in the form of tax incentives has the strongest effect on innovation; on the other hand, for private companies, innovation is more strongly stimulated through credit support and tax incentives. For all of this, I consider the article to be very important for the community, companies and public institutions.
Response：Thank you for giving such a high rating to our article! Thank you very much for your understanding of our article, which analyzes the effectiveness of industrial policy through the impact of strategic emerging industries on innovation. We found through the implementation of supportive policies for China's strategic emerging industries that the state's industrial policy is not necessarily efficient, and that although it gives tax incentives to these firms and government subsidies to promote these firms to increase their R&D and innovation outputs, this is only a behavior of the firms that are being supported in order to cater to the state's policy, and the firms have not improved their own performance because of their innovations to improve their own operating conditions.
Reviewer 3 Report
Comments and Suggestions for AuthorsPlease refer to the attached document.
REPORT ON SUSTAINABILITY (2679727)
Title: Effect of the strategic emerging industry support program on corporate innovation among listed companies in China
General Comment:
The authors analyzed the relationship between the Chinese government’s Strategic Emerging Industry Support Program and the innovation level of strategic emerging industry firms. The study findings can promote and support the growth of industries that are considered strategically important for economic development, technological innovation, and overall competitiveness. The manuscript addresses a valid research question. The manuscript requires minor revisions.
Title
â–ª The title of the draft manuscript is okay.
Abstract
â–ª The abstract can be read and comprehended independently. But there is a need for improvement.
â–ª The authors can add the paper's contribution to knowledge and direction for future research in this section.
Keywords
â–ª The keywords may be improved (e.g., Corporate Innovation, China).
Introduction
â–ª The section provides the subject's present state with minor grammatical errors. But it can still be improved.
â–ª They also presented relevant statistics for the study logically.
â–ª The purpose of the study is elucidated and maintained throughout the paper.
Theoretical Background
â–ª The authors reviewed the relevant literature, most of which is current.
â–ª The authors indicated where the knowledge gap originated with proper referencing.
Hypotheses
â–ª The hypotheses should be formulated based on the study objectives. However, the author mentioned only one objective and we have three hypotheses.
â–ª Kindly update or explain the reason why.
Methodology
â–ª The section is elaborate. Any other researcher can replicate similar study in a varying environment.
2
Results
â–ª The section name should be ‘results and discussion’.
â–ª The results are novel and presented logically.
â–ª The arguments and discussion of the findings are coherent and compelling. However, they can still be improved.
â–ª Panel data regression is a statistical method used to analyze data that has both cross-sectional and time-series dimensions. Can the authors provide sample data in the appendix?
Conclusions
â–ª The section may be improved.
â–ª Restate your primary arguments based on the stated hypotheses and the most critical evidence supporting those points.
â–ª The authors should also provide the limitations encountered during the research process.
â–ª In addition, the authors may point to areas that need further investigation.
Figures and Tables
â–ª All the figures and tables have descriptive titles that describe their contents in detail.
â–ª They are also cited in the text.
References
â–ª The provided citations are okay and relevant to the content of the study.
Comments on the Quality of English LanguageMinor grammatical errors.
Author Response
Response：Thank you for scrutinizing every part of our article!
According to your comment, (1) in the abstract section, we include a contribution to knowledge, and our contribution is to try to answer the question, whether industrial policy is efficient.
(2) In the keywords section, we have added the keyword "Chinese Corporate Innovation".
(3) This paper investigates the impact of strategic emerging industry policy on firms' innovation, with the aim of answering the question of whether industrial policy is efficient or not. The first hypothesis of this paper is the basic hypothesis, which aims to give an answer to the impact of strategic emerging industry policy on innovation; the second hypothesis is based on the first hypothesis, which gives an answer to the mechanism of the impact of strategic emerging industry support policy on innovation; and the third hypothesis is the hypothesis based on heterogeneity analysis, which aims to answer the question of the different effects of different enterprise policy support on innovation.
(4) We have changed the title of the results section to "Results and Discussion" section.
(5) In the conclusion section we have adjusted the conclusion as shown below:
The results reveal that the program stimulates R&D investment among firms in strategic emerging industries, consequently increasing the number of patents granted. How-ever, patent efficiency, measured by patent output per unit of R&D investment, and innovation quality, measured by the ratio of granted invention patents to the total number of granted patents, did not improve significantly as a result of the program's support, indicating a lack of improvement in innovation efficiency and innovation quality among the enterprises in strategic emerging industries who benefited from the program.
In conclusion, strategic emerging industry enterprises exhibit strategic innovation in response to the government support program, with the innovation focusing on increases in R&D in-vestment and the number of patents at the expense of improvements in innovation efficiency and quality. In addition, the Strategic Emerging Industry Support Program encourages enterprise innovation through subsidies and tax benefits, which increase enterprises' book assets, thus stimulating R&D investment and improvements in patent quantity.
The government's support program prompts banks to facilitate access to credit for enterprises in strategic emerging industries, which is conducive to their R&D and innovation. The government support program also results in investors forming long-term expectations and holding the company's stock for a longer period of time, which reduces the liquidity of the company's stock. This reduces the risk of hostile takeovers and supports a managerial focus on R&D and innovation. Further heterogeneity analysis reveals that, in terms of R&D investment, the government support program has a stronger incentive effect on private enterprises than on SOEs in strategic emerging industries; in terms of patent output, the support program has a stronger incentive effect on SOEs than on private enterprises in strategic emerging industries.
Finally, for SOEs in strategic emerging industries, the program has the greatest effect on R&D and innovation through subsidies and tax incentives; for private enterprises in strategic emerging industries, tax incentives, convenient credit, and reduced stock liquidity have the strongest effects. At the same time, we include in the article the direction of further research in the future, and our further research direction is to investigate why the supportive policies for strategic emerging industries have not led to an improvement in the innovation efficiency and quality of the supported firms, and why the industrial policies have not led to a better performance of the supported firms.
Reviewer 4 Report
Comments and Suggestions for AuthorsDear Authors,
Congratulations on your paper entitled "Effect of the Strategic Emerging Industry Support Program on 2.
Corporate Innovation among Listed Companies in China" which is an interesting paper focusing on the evaluation of the performance of the Chinese SEISP program between 2007 and 2017.
The paper is comprehensive and correctly designs and executes the elements of analysis. We consider it publishable in the present form. However, perhaps the research would be strengthened with the application of qualitative dynamics that would make the text abandon its clear quantitative-descriptive dimension, entering into the qualitative, since answers would be obtained, for example, to the reasons for the different impact of the program between public and private companies. The quantitative analysis provides answers to the what, the qualitative analysis to the why. Taking into account both dimensions would reinforce the academic impact of the paper.
Best regards,
Author Response
Response：Thank you for your insightful comment. According to your comment, we have added cases such as the Security Group in the article used to qualitatively analyze when the policy support, the enterprise to pay the industry transformation efforts, and increased R & D investment and innovation output, but unfortunately, We do not have the opportunity to understand the reasons for the internal heterogeneity of the enterprises of the specific strategic emerging industries through the publicly available information, and thus cannot further analyze them qualitatively on the basis of the original, but the suggestions you have provided are very valuable and we have benefited a lot. If we have the opportunity to collect cases in this area in the future, we will further improve this study on that basis. Thank you again for your comments.
